PERUSAHAAN Otomobil Nasional Bhd (Proton) has taken another major step towards diversifying its earnings base by teaming up with Bumiputra-Commerce Bank (BCB) to offer financing to Proton car buyers.
The joint-venture agreement was signed in Shah Alam yesterday between their respective wholly-owned subsidiaries, Proton Edar Sdn Bhd and Bumiputra-Commerce Finance Bhd (BCF).
Proton chief executive officer Tengku Tan Sri Dr Mahaleel Tengku Ariff said the 50:50 joint-venture company, known as Proton Commerce Sdn Bhd, would enable the national carmaker to have a better-diversified earnings portfolio.
To generate more non-motor earnings, the group is also exploring opportunities in the manufacturing and engineering sectors.
“There are lots of possibilities for us in these businesses (manufacturing and engineering),'' Mahaleel said at a news conference after the agreement signing ceremony.
However, he did not say how much Proton expected its non-motor earnings to contribute to total group income in the future. “It (non-motor earnings) will depends on the situation after Afta (Asean Free Trade Area)? car price behaviour will also be a factor,” he said.
BCB chief executive officer Dr Rozali Mohamed Ali, who was also present at the signing ceremony said the car-financing joint venture was part of the pre-emptive measures being taken by Proton and BCB ahead of the full liberalisation of the local automobile and banking industries.
“We are doing so in a way that will reinvent the industry,'' said Rozali.
Rozali expects the joint venture to have a “positive impact” on the banking group's bottom line.
For the financial year ended Dec 31, 2002, BCF posted a pre-tax profit of RM95.28mil compared with RM84mil in the previous year.
Mahaleel concurred that the convenience offered to car buyers to obtain financing from Proton Commerce at lower cost would boost the national carmaker's sales volume.
Proton, he said, had undertaken an extensive evaluation exercise before identifying BCB as its ideal joint-venture partner.
Proton Commerce, which will have a capital base of RM250mil, is expected to start operations by year-end at the earliest.
It will first roll out its car-financing product to Proton customers before moving on to bundle other financial services such as credit card, insurance and leasing.
The joint venture, which does not function as a finance company, will source its loans from BCF.
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