KUALA LUMPUR: Zhejiang Geely Holdings Group's purchase of a stake in Proton Holdings Bhd is proving strategic as the national car maker will now be able to tap into advanced auto technology given the Chinese group's acquisition of Mercedes-Benz owner Daimler AG just last month.
There is now the prospect of sharing electrical car technologies since Proton has become part of a potentially lucrative and technologically-advanced auto group.
This includes international brands such as Daimler, Mercedes-Benz, Volvo cars and trucks, Lotus as well as London Taxi Cabs.
Geely bought Daimler as it is racing to build electric cars to meet tough Chinese emission standards and produce energy-efficient cars.
Geely believes that modern technology will propel the group to evolve into a technological giant at par with Google, Uber and set the stage for it to emerge as a technologically advanced vehicle manufacturer. With such technologies, the Chinese company can give other car makers a run for their money.
As for the purchase of Volvo by Geely in 2010, it is proof of Geely's ability to turn around the renowned but ailing Swedish auto maker. Having observed Volvo's evolution and a development as a carmaker since the early days, an auto analyst remarked that modern-day Volvo cars have never been sexier, thanks to Geely's input.
Against such a backdrop, the question is why they also chose to acquire a 49.9 per cent stake in Proton.
While other potential buyers might have missed it, Geely saw the strategic importance and potential of acquiring Malaysia's national car maker. Geely is an ambitious and professional automotive group with a global outlook and it aims to make money out of its Proton investment.
Analysts say outsiders seem to have more faith in Proton that Malaysians themselves, which is why Geely should be given a chance to prove it could rehabilitate Proton into a profitable company.
The Proton plant in Tanjung Malim is underused and Geely is targeting to ramp up production to a whopping 400,000 cars in 10 years to sell them to the domestic, regional and global markets.
With this target nailed down, Geely is working to ensure Proton's vendors, ecosystem and infrastructure support it.
Proton has huge hurdles to overcome and this includes changing attitudes among its workforce and suppliers. Vendors have to step up and offer parts that are competitively-priced. Sales and support networks have to improve to Geely standards.
Just as it had transformed Volvo, Geely is executing its action plans to make Proton stand tall and show up on the global grid.