PSA-Proton ties strengthen

PSA Peugeot Citroen is emerging as the frontrunner in developing ties with Malaysia’s Proton.

Although speculation has been rife for months that Peugeot was looking at links with the emerging car-maker, GoAuto understands an announcement is due within weeks naming the French car-maker as a new alliance partner.

Various automotive websites in Malaysia have reported unnamed sources saying Peugeot was also the likely choice.

If the deal goes ahead, Proton will have access to a range of small-car platforms, as well as diesel engines, that could help bolster the company's future line-up, both in Australia as well as South-East Asia.

In June, Proton's managing director, Syed Zainal Abidin Syed Mohd Tahir, revealed that talks were "quite advanced" but refused to divulge just exactly what had been agreed.

A PSA company spokesperson has also verified that PSA was in talks with Proton regarding a larger-scale alliance.

Proton is also known to be talking to other brands. In February both Mitsubishi and Proton signed a memorandum of understanding to explore the feasibility of co-operation with platform architectures and components.

PSA is no stranger to the joint-venture scene, with existing arrangements with Toyota, Mitsubishi and Ford for engines as well as specific models.

With Peugeot on side, Proton could gain access to the relatively new 207 and 307 platforms, as well as engines, for its future small hatches, sedans and wagons.

The deal could also raise the prospect of small Peugeots being manufactured in Malaysia for Asian markets, including possibly Australia.

The Malaysian company Cycle and Carriage Bintang Bhd is currently the sole distributor for Mazda and Peugeot in Malaysia and is believed to have plans to establish a CKD (completely knocked down) assembly for Peugeot vehicles.