Proton sought funding from Miti, minister confirms

International Trade and Industry Minister Datuk Seri Mustapha Mohamed confirmed that Proton had sought funding from Putrajaya, but declined to reveal the nature of assistance the carmaker had requested.— Picture by K.E.Ooi
International Trade and Industry Minister Datuk Seri Mustapha Mohamed confirmed that Proton had sought funding from Putrajaya, but declined to reveal the nature of assistance the carmaker had requested.— Picture by K.E.Ooi

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KUALA LUMPUR, March 5  — National carmaker Proton Holdings approached Putrajaya for funds, Datuk Seri Mustapha Mohamed confirmed today but said the practice was not unusual among local firms.

The minister of international trade and industry declined, however, to divulge the purpose of the funds being sought by the struggling automaker, other than to say Putrajaya provides various forms of allocations to help local companies grow, including tax breaks, research and development grants, and training incentives.

“Of course companies come for incentives especially Proton. We do give R&D grants, training grants,” the minister told reporters at his office here.

Mustapha said all such applications were screened and no preferential treatment will be given.

“The approval will be based on two things. One is the availability of funds; second is the cost benefit analysis. That is applicable to any application, not just Proton,” he said.

Earlier today, English daily The Star reported that Proton is trying to source as much as RM3 billion from Putrajaya and other sources in order for it to develop new models for the market.

According to the report, Proton had approached Miti last year to help fund its model development but came away empty handed after failing to convince its officials. It then turned to national oil firm Petronas but was similarly unsuccessful.

The firm is said to require some RM3.8 billion in investments by 2017 and at least RM1.8 billion by next year.

During its heydays in the 1990s, Proton accounted for nearly four of every five new vehicles sold, but has since witnessed its fortunes dwindle before being overtaken by second national carmaker Perusahaan Otomobil Kedua Sdn Bhd (Perodua) as the best-selling brand in Malaysia.

Proton was established in 1983 by former prime minister Tun Dr Mahathir Mohamad in his bid to jumpstart Malaysia’s shift towards manufacturing.

In 2012, it was sold to Tan Sri Syed Mokhtar al-Bukhary’s DRB-Hicom.

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