Protons Reinforcements

According to a report, DRB-Hicom has selected a Japanese carmaker as Proton’s first foreign strategic partner, and that partnership is set to be announced in Japan later today.

The report by Business Times doesn’t name the automaker, only venturing through a person familiar with the matter that the partner “is among the top 10 manufacturers in the world.” The BT report adds that that there are four Japanese automakers in that global list for 2012, namely Toyota, Nissan, Honda and Suzuki.

The move to cement an alliance with a Japanese automaker will put to rest the ongoing speculation of a tie-up with Volkswagen – there have certainly been enough overtures and intimations in the past down thatparticular path. The BT source told the publication that the Japanese option had been picked as the agreement had an air of exclusivity tied to it.

The report adds that as part of the deal, the Japanese automaker will help Proton build its own engine, and there will also be platform sharing arrangements, with efforts to fill up the production capacity void at Proton’s under-utilised Tanjung Malim plant. The source adds that it will take about six months to get the ball rolling, but that the effects will be positive for DRB-Hicom’s bottom line.

As a follow-up, we spoke to a source close to the matter, and we can confirm that the strategic partnership is very much on and set to be inked today. The source, however, declined to name the particular automaker.

Speculatively, we can pretty much count Toyota out, with the automaker currently having a key stake in Perodua. As for Nissan, despite the intimation last year that the Proton Perdana replacement would be the Fuga, a deal also seems highly improbable.

In essence, it would make sense for DRB-Hicom to walk down the road with either one of the two remaining automakers on the list, in this case Honda and Suzuki, based on its existing workings with both.

It is already assembling vehicles at its base in Pekan, Pahang, for Suzuki and Isuzu as well as Mercedes-Benz and Volkswagen, and it has a firm association with Honda through Honda Malaysia (the JV was previously known as DRB-Oriental-Honda), which builds Honda vehicles at its facility in Hicom Industrial Park Pegoh in Alor Gajah, Melaka.

Despite its sterling reputation for making great small cars, Suzuki’s size and outlook doesn’t quite fit the bill in this case, which leaves the likelihood of Honda being the name that pops up as the strategic partner when the announcement is made later today. Revelatory and stunning as that may sound, we’re hazarding a guess in this particular direction, given the four names bandied.

The company does have all the necessary to carry it off, be it with platforms or engine-tech, and a move for Proton to work with the Japanese automaker would definitely be beneficial, to say the least. Of course, everything remains speculation for now – we’ll find out if it is indeed Honda later today; the surprises never cease. Stay tuned for developments as they unfurl.