Proton should immediately identify a strategic foreign partner, be professionally managed, without interference in its business and the company should adopt tough but necessary measures for the long term, he said, according to The Star Online.
Proton should “graduate” from government protection as protection would eventually be abolished, as in Japan and South Korea.
Proton once commanded a 74 per cent share of the motor market but sales have slumped to about 15 per cent.
Mustapa said Proton had cost the government RM13.9 billion in grants, aid and forgone taxes, besides an injection of RM100 million to alleviate the burdens of Proton vendors last year.
He said the government had been seriously deliberating Proton’s request for grants and soft loans. “It is a major request and the Government needs to be thorough with its evaluation as a lot of public money is involved,” he was quoted as saying.
He reiterated the need for prudence, as government revenue had fallen with the crash in global oil prices.
Mustapa said he had been told about cases of unprofessional decision-making by Proton, and advised the company to appoint “a competent leadership team.”
Commenting on the resignation of Dr Mahathir Mohamad as Proton chairman, Mustapha said “we must not turn a blind eye to challenges faced by Proton and its inability to establish a solid financial footing.”
He said the company needed high capital resources for research and development. Scale was also crucial but Proton currently had neither, he added, pointing to the under-utilisation of Proton’s two production plants at 35 per cent each.
Proton now only commands about 17 per cent of car sales. The government sold the company to motor assembler DRB-Hicom Bhd for RM1.2 billion in 2012. The company assembles or distributes Honda and Volkswagen cars and Isuzu commercial vehicles, among other makes, and produces components. Malaysia’s second car company Perodua is a joint-venture between Permodalan Nasional with Daihatsu and Toyota and has about 34 per cent of the passenger car market.