Defending Honda rebadging, minister says poor returns to build Proton Perdana from scratch

Datuk Seri Mustapa Mohamed says it was purely a business decision by Proton when it cut a deal with the Japanese automotive giant to allow it to rebrand the model as the Perdana and gain access to the latest technology without heavy outlay. — Picture by Choo Choy May
Datuk Seri Mustapa Mohamed says it was purely a business decision by Proton when it cut a deal with the Japanese automotive giant to allow it to rebrand the model as the Perdana and gain access to the latest technology without heavy outlay. — Picture by Choo Choy May

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KUALA LUMPUR, Nov 4 ― Low volume models such as the Proton Perdana do not justify the hundreds of millions needed to develop these, Datuk Seri Mustapa Mohamed said today in defending the national carmaker’s rebadging of the Honda Accord as its own executive sedan.

The international trade and industry minister said it was purely a business decision by Proton when it cut a deal with the Japanese automotive giant to allow it to rebrand the model as the Perdana and gain access to the latest technology without heavy outlay.

“It costs no less than US$500 million (RM1.6 billion) in research and development to create a new car, and if you just talking about 4,000 to 5,000 units in production volume, that does not justify the cost.

“For business considerations, it is better to adopt existing (car) models,” the minister told Parliament during question time.

Putrajaya officially took delivery of the first batch of the Accord-based Proton Perdana in December last year, to replace its ageing fleet of first-generation Perdanas that had served as the official government car for some two decades.

It was widely reported that Proton decided to rebadge the Honda executive sedan - which included some minor cosmetic changes - as the Perdana Replacement Model (PRM) after the federal government initially mulled a plan to replace its executive fleet with the Japanese make.

Despite his justification for the rebranding exercise, Mustapa denied that Proton has not made any effort to develop homegrown offerings, as claimed by Barisan Nasional’s Kinabatangan MP Datuk Bung Moktar Radin in a supplementary question.

Bung said it the norm for Proton to merely adopt Japanese technology, as the car company did with the flagship Perdana that ran on a Mitsubishi powerplant, raising questions as to the future and sustainability of Malaysia’s automotive industry.

“It is true that the (Perdana’s) engine is from Japan, but as it is, 32 per cent of the car is made from local content and it is assembled at a plant in Malacca... it is not true to say there is no Malaysian car,” Mustapa said without elaborating.

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