SUBANG JAYA: National carmaker Proton Holdings Bhd has bolstered its partnership with Aapico Hitech Public Company Ltd, one of Thailand's largest automotive parts companies.
Proton today said the company and Aapico had signed a joint venture agreement to produce dies, jigs, hot stamping parts, body assembled parts and chassis components.
Aapico will buy a 60 per cent stake in Advance Vehicle Engineering Global Sdn Bhd (AVEE Global) from Proton.
Proton will retain a 40 per cent stake in AVEE Global which will be renamed as Aapico Avee Sdn Bhd.
Prior to this, Aapico's presence in Malaysia was through a car dealership business where it owns and operates six car dealerships in Malaysia including four Proton showrooms.
The partnership will see Aapico making an initial investment of RM40 million into AVEE Global's 20-acre facility.
Another RM100 million in investment is
planned for 2024, for plant extensions and the acquisition of new machinery.
According to both parties, the operational manufacturing facility will soon be ramping up its production volume with new products in the pipeline.
Aapico will be managing operations and introducing new technology applications to produce better quality parts, improve production and cost efficiency.
The future expansion will also see the
development of human capital with more jobs being created and attracting highly skilled talents to the country.
Proton said the JV strengthens the company's ambitions to become a major player in the Asean automotive market.
"By leveraging on Aapico's economies of scale and investment initiatives and combining it with Proton's own existing technologies in areas such as hot press forming of body parts, the company hopes to be able to make a quantum leap to power it to the forefront of one of the fastest growing automotive regions in the world.
"The JV with Aapico will benefit the company by helping to provide the company better cost optimisation, efficiency, and quality in the production of its cars," Proton chief executive officer Dr Li Chunrong said here today.
"As our volume increases in tandem with our model introduction plans, we will continue to work to ensure our products are on par with the competition in terms features and quality while continuing to offer outstanding safety from the use of technologies such as hot press forming," he noted.
Aapico president and chief executive officer Yeap Swee Chuan said the company is taking the opportunity to enter the auto parts manufacturing sector in Malaysia at this right time, with promising growth expected in the automotive industry led by strong demand for Proton vehicles and further supported by strong economic growth.
"We aim to bring our expertise and manufacturing technology into the partnership and deliver world class auto parts to Proton and support their expansion plans in both the domestic and export market," Yeap added.
Investment, International Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz, who witnessed the signing today, said the partnership will generate sustainable economic growth, increase competitiveness and create innovative and high skilled employment opportunities in the workforce, particularly in the manufacturing sector.
The partnership with Proton is Aapico's second venture in Malaysia's auto parts sector.
Earlier this year, the Thai company signed a JV agreement with Purem, one of the largest exhaust systems suppliers globally.