Crocodile tears: Mahathir and Proton
It is better for Malaysia to own 50.1% of a company that has chance to survive and have a market of 1.43 billion people than to own 100% of a company that is on the verge of bankruptcy and losing billions of Ringgit every year in a market of just 30 million people.
(LSS) – 1. Proton sales started to decline in the year 2003 while Tun Mahathir was still Prime Minister. Just two years later in 2005, it was overtaken by Perodua in the Malaysia market and overtaken by Honda in 2016.
Exports sales to UK and Singapore have now dropped to zero.
In Australia, from Jan to April 2017, Proton only managed to sell 11 cars.
2. Lotus Cars have lost money every single year since Proton bought the company in 1996 – losing a total of an estimated RM6 billion over the past 20 years and RM920 million in 2013 alone.
3. Tun Mahathir had asked Volkswagen to take a 50% stake in Proton in the year 2005 but the deal did not happen. Later, Tun Mahathir asked the government to sell all of Proton to DRB-Hicom in 2011.
4. Since DRB-Hicom fully took over in 2012, Proton have lost RM4 billion. In the year 2016 alone, Proton lost RM1.4 billion. Proon had also dragged the parent DRB-Hicom group into losses – putting 100,000 jobs at risk.
5. The heavy losses and lack of cash in Proton also caused payments to Proton suppliers and vendors to be unpaid – putting another 40,000 jobs at risk.
Mahathir’s son, Mokhzani Mahathir owns the official distributor of Porsche cars in Malaysia and has a long involvement in the local Auto Industry. The situation is so bad that Mokhzani, who had a fortune of RM4.22 billion in the year 2014 and is the second richest Malay tycoon, did not dare to pay the RM1.1 billion to buy up DRB-Hicom’s stake to help save Proton
6. Due to the big amount of jobs at risk, the govt had no choice but to give RM1.5 billion in soft loans to Proton in early 2016 which Proton immediately used up to clear off all its debt to its suppliers and vendors. In late 2016, the govt was also forced to give another RM1.7 billion in credit line to Proton to enable it to continue operating.
7. The total assistance given by Govt to Proton in 2016 alone is RM3.2 billion – This is more than half of the RM5.9 billion that the govt paid in BR1M to 4.7 million households and 2.7 million single individuals for the year 2016.
