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VW targets ASEAN sales with Proton agreement

Volkswagen and Proton have signed a partnership agreement which will enable the German carmaker to establish a foothold in Proton’s homeland of Malaysia without having to build its own production plants.

The first step will be to prepare kits for two models, expected to be Golf and Passat, which will be assembled at Proton’s plants for sale in the domestic market, beginning late 2005. VW has a 2006 sales target of 15,000 units in Malaysia, sold initially through Proton’s retail network, and later into other Association of South-East Nations (ASEAN) members.

Once established, the range could be expanded to include other VW group brands, like Audi. Malaysia’s expensive import taxes and protectionist stance over its own Proton and Perodua carmakers have prevented foreign VMs from establishing a foothold. Yet it has the largest market of south east Asia, with more than 300,000 cars sold annually.

Executives from the two vehicle manufacturers met at VW’s Wolfsburg head office last week to sign a memorandum of understanding. “The primary aim is to build an automobile industry of global market standard. Joint vehicle development will also be closely examined,” says a VW spokes-man. Both carmakers will retain full corporate independence.

Might we see Proton and VW cars sold side by side in the UK? Not according to VW. “It’s not going to happen,” says a spokesman.

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