GM keen on stake in Proton

GM keen on stake in Proton

KUALA LUMPUR (AFP): U.S.-based auto giant General Motors Corp. is keen to take a stake in Malaysian carmaker Perusahaan Otomobil Nasional Bhd. (Proton), a newspaper reported yesterday.

General Motors chief economic specialist Mustafa Mohaterem was quoted as saying in Detroit that the global chances of Proton, currently affiliated with Japan's Mitsubishi Motors Corp., would be enhanced by an equity partnership.

"Our opinion is that buying equity in Proton is more attractive than taking up a stake in South Korean car makers," Mustafa told the Malay-language newspaper Berita Harian.

"This is because Proton has a production rate that meets demand for its cars while South Korean companies have a production capacity that is far higher than demand," he said.

Mustafa said small car makers like Proton, which is 16 percent-owned by Mitsubishi, needed bigger partners to be competitive in the global market.

General Motors already has an indirect stake in the Malaysian auto industry through its 37 percent-owned Japanese affiliate Isuzu Motors Co. Ltd. which holds 20 percent of Malaysia Truck and Bus Sdn. Bhd.