Volkswagen has scrapped plans to cooperate with Malaysia’s state-controlled Proton Holdings to build and sell VW brand cars for the local market.
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“We had a very specific idea how we wanted to proceed there. Unfortunately the Malaysian government, (Malaysia’s state investment arm) Khazanah and Proton had different ideas. Therefore what we wanted in the cooperation with Proton will not materialise,” chief executive Bernd Pischetsrieder told investors in Dearborn, Michigan, according to Reuters.
Reuters noted that the carmaker in October 2004 said it had signed an agreement for a long-term strategic partnership with Proton that would help it enter the growing Southeast Asian car markets without significant investments.
As a first step, VW and Proton agreed to assemble two VW models from knock-down kits with some locally-sourced parts to help build up the domestic auto industry. The initial sales target given for 2006 was more than 15,000 units, the report added.
Pischetsrieder reportedly said during the presentation that while it was still in talks with Proton, there were no more benefits to be attained out of the partnership for Volkswagen.
“What we are investigating now is whether in a few isolated projects we can support Proton – and I’d like to put the emphasis on exactly that word, to support Proton, and not to have any joint programmes or joint ventures or so but to support Proton,” Pischetsrieder said, according to Reuters.
When asked by an analyst whether VW would exclude the possibility of shutting one of its European plants in the next couple of years, Pischetsrieder ruled out any plans that it might entirely close one of its European plants, but he added that this did not mean there would not be extensive restructuring of its manufacturing footprint on the continent, according to Reuters.
