LAST_UPDATESun, 18 Mar 2018 9pm

Geely Can Help Proton Vendors Penetrate Global Market

KUALA LUMPUR – Auto analyst Hezeri Samsuri has expressed confidence that Zhejiang Geely Holdings is capable of helping Proton vendors penetrate the global market, by supplying auto components for cars such as Volvo and Mercedes. which now come under the Chinese auto group.

He said that this was now possible as Geely, which purchased a 49.9 per cent stake in national car maker Proton last year, recently bought a significant 10 per cent interest in German auto group Daimler, which makes Mercedes Benz and acquired Swedish car maker Volvo in 2010.

As such, the national car manufacturer with Geely as a foreign strategic partner has become part of a potentially lucrative and technologically-advanced group comprising international brands such as Daimler, Mercedes Benz, Volvo cars and trucks, Lotus, as well as London Taxi Cabs.

It also means the auto parts vendors do not merely have to focus on supplying the Tanjung Malim plant, but endeavour to penetrate and supply to global brands under the group in the future, Hezeri said in a recent interview.

Local vendors should vie for these “golden” opportunities by penetrating Geely’s vendor system and compete in supplying components to various global marques such as Volvo and Mercedes, he said in a statement containing excerpts of the interview and made available to Bernama.

To meet the targeted manufacturing capacity of 400,000 cars in the next 10 years, it is imperative for auto vendors to upgrade from mere sales centres to providing after-sales-service via one-stop centres offering comprehensive services.

Suggestions to car distributors to upgrade service centres to 3S and 4S would also create the infrastructure to supply auto components at competitive prices, he said, adding that globally, there were very few 1S service centres.

Hezeri said that it would not be profitable for distributors if they merely sold cars, but provide after-sales-service and servicing in the overall package to meet customer demands.

”Geely’s auto expertise is capable of helping local vendors achieve global quality standards, a very-much needed ingredient to bolster customer confidence.

“I’m sure Geely is wise enough to help local vendors achieve their expected quality standards and at the same time enable vendors to rake in profits,” he added.

He cited how in Japan, vendors were supported to achieve a certain standard of quality that would enable them to achieve profitability as well.

Geely’s global market penetration was a clear indicator of their capability in the global automotive industry, said Hezeri.

Having an equity in giant auto firms such as Daimler and Volvo was also clear proof that the Chinese auto giant’s partnership with Proton was not mere rhetoric.

“Who are we to question if a company that purchased Swedish automaker Volvo, bought shares in Mercedes Benz, and LEVC, the maker of London’s black cabs, due to their strategic importance, also has similar faith in Proton.

“This only serves to reinforce Geely as an ambitious, professional and global automobile group with the insight to acquire Proton alongside a firm belief in the national car manufacturer’s potential to generate profits in time to come,” he said.

A crucial pre-requisite for Proton to achieve a production capacity of 400,000 or even a million units is that it needs to have markets, which in the process, enables its vendors to achieve economies of scale for their auto components.

Although relatively a new company, Geely is not a novice when it comes to marketing experience and new ideas.

It is clear to see how aggressive it is in the global automotive industry to the extent that even Volvo and Daimler AG were taken aback.

Geely knows exactly what it is doing, which was why Bumiputera vendors, salespersons, as well service centre operators, should be aware of the intense competition in the global automotive industry.

It is imperative that they upgrade to 3S and 4S service centres so as to benefit from Geely’s endeavour to create the infrastructure for the supply of competitively-priced auto components, Hezeri said.