Proton Business Strategy

1.0 Introduction

In a combined effort, Proton and BMW will be engaging in a joint-venture to produce a car; this car will be named Proton Morgana. Proton is a Malaysian automobile company specializing in producing consumer cars. Since its founding in 1983, Proton has so far produced a total of 17 car models to varying receptions. It is also the first home grown automobile company of Malaysia. Once boasting as high as 80% of the car market share in Malaysia, this has been continuously dropping and as of the 3rd quarter of the 2011 financial year, Proton’s market share has stooped to 29% (Ellis 2006).

On the other hand, BMW is a German automobile company. Formed in 1916, BMW is a veteran in the auto industry marker with an international presence and currently ranks 79 in Fortune’s Global500 listing (Fortune 2011). BMW has released the 1 Series of car models since 2004 as a replacement to the BMW Compact series; although the actual car performance was good, the first model in the 1 Series were noted for its unusual appearance which, in the words of Leathern (2011), “had a low, stooped line that ran the length of the wheelbase, making it look like a sagging sofa”. Through this judgement based on appearance alone also resulted in the 1 Series being labelled the ‘Marmite car’ where the demographic either loves it or hates it. However, despite that the 1 Series still manage to sell 1.2million cars, speculated to be an attribution to it being the cheapest BMW in the market (Leathern 2011). This demonstrates the BMW’s strong image of prestige in the market which is willing to purchase a BMW irregardless of the product presentation.  

2.0 Project problem and objectives

The highest priced Proton car in Malaysia is the Proton Perdana 2.0 V6 which is sold for around RM101.500 (Proton Edar 2011). For Proton, this project is an attempt to venture into the mid-range car market category