Proton Slides Into The Red In 3Q

(MySinchew) – Malaysia's national carmaker Proton said Friday it sank into the red in the third quarter, with losses of RM74.7 million due to weaker sales and higher material costs.

The company said the loss for the three months to December compared with a net profit of RM10.3 million a year earlier.

"The Malaysian automotive industry is expected to face increasingly challenging conditions due to the ongoing global financial and economic crisis," Proton said according to Dow Jones Newswires.

Warning of tough times ahead this year, the company said the impact of the global slowdown and the strengthening of foreign currencies against the Malaysian ringgit would continue to impact its profitability.

The national auto firm has struggled to cope in a newly competitive environment, suffering a steep drop in market share which had threatened its viability.

However, it posted a huge jump in second quarter profits, to RM43.8 million compared to RM3.5 million a year ago, as it benefited from a positive response to its two compact models.

In the third quarter, it said it was hit by the gloomy economic outlook which saw the Malaysian passenger car market contract by 23 percent compared to the previous quarter.

Proton's domestic sales volume fell by 15 percent in the third quarter.

The company said it will intensify efforts to strengthen its distribution network and increase its domestic market share by investing in refreshed products and new models.