Before we begin to be too sentimental with Dr Mahathir’s disappointment claiming that the new partner from China will eventually wipe out our automotive pride Proton, a few of the main issues that we need to ask ourselves should be on the business performance when he was the Chairman and why Proton is still in their needy position since they were established for many decades? What has Mahathir hid from us?
Proton is no longer fully owned by the government ever since Dr Mahathir’s blue-eyed boy Tan Sri Syed Mokhtar owned close to 55% shares in DRB-Hicom, therefore it is already a private company. As early as mid-June last year, local and foreign medias have been reporting that Syed Mokhtar himself is fuelled by debt and as at to date, his listed and privately held entities combined long-term borrowings are estimated at RM34 billion.
He is one of Mahathir’s surviving poster boy during his premiership who depended too much on his mercy for government mega projects. The need to raise new capital for the group has gravely failed when banks and other finance institutions were too cautious to extend new loans. Hence, Proton too suffered in their cash flow besides their slumps in car sales and high inventory levels of unsold cars.
Before PM Najib’s administration decided to agree to approve soft loans to Proton, they were bled with more than 2.5 billion debts. Proton had earlier demanded to be bailed out as is customary practised by Dr Mahathir era but since Proton is now a private controlled company, there is no reason to do so and providing soft loans should be most appropriate.