Volkswagen mulls tie up with Proton to begin production in Malaysia!

The humungous Volkswagen group doesn’t have a big presence in South East Asia and this is one big reason why the German automaker has been trying to tie up with Malaysian automaker Proton. Volkswagen has has negotiations in the past with Proton although nothing concrete did come out of it. The latest development on this front is that Volkswagen is once again considering tying up with Proton to begin producing Volkswagen cars in Malaysia. This is expected to give the German automaker a toehold in the South East Asian market as producing cars in Malyasia is expected to be cost effective.

2012 Volkswagen Up! 5 Door Hatchback

In India too, Volkswagen tried to make further inroad into the small car market, by taking a stake in Japanese automaker Suzuki, which incidentally owns India’s largest automaker, Maruti. The Volkswagen-Suzuki tie up was expected to give Volkswagen a firm hold over the Indian market while also being a hub for small car production for exports as well as the local market. The Volkswagen-Suzuki deal has been mired in trouble right from the outset and things have reached a point of no return for the alliance, with Suzuki opting out many months ago.

2012 Volkswagen Up! 5 Door Hatchback

The Volkswagen group owns a slew of car brands, with Volkswagen, Porsche, Audi, Seat, Scania, MAN, Bentley, Bugatti, Skoda and Lamborghini all being a part of the group. Volkswagen plans to dominate the global car market through aggressive parts and platform sharing. The latest MQB platform on which many high volume cars of Volkswagen, Seat, Audi and Skoda cars will be built is expected to be instrumental in Volkswagen achieving its target of 10 million cars each year by 2018. Volkswagen taking stake in Proton though DRB-HiCOM could give the Malaysian automaker a new cash flow option for new product development, as Proton seeks to battle Japanese competition like Toyota and Honda.

Via Bloomberg

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