Proton to Join Forces with India's Hero

Malaysian carmaker Proton confirmed today it has engaged in talks with Indian motorcycle manufacturer Hero, to research the synergies of a possible partnership. Proton sees Hero as its main gate to the Indian market, a priority for the company, as Proton Holdings managing director, Datuk Syed Zainal Abidin Syed Mohamed Tahir said according to just-auto.com.

“We want to enter the market as soon as possible. We have many things to discuss with Hero in the meantime and we will announce something in the second half of the year.”

The decision to enter the Indian market was announced by Proton ever since November last year, when Syed Mohamed Tahir announced the main areas targeted by the group for a future plant are either Mumbai or Chennai.

"We expect to finalise a joint venture agreement in early 2010, with assembly operations starting up 12-14 months later", he was quoted as saying by the source. "A Lotus Engineering design centre will be set up in either Chennai or Mumbai early next year".

According to Proton, bringing its operations into India would allow the reduction in costs by 30 percent compared with importing parts from Malaysia.

As for Lotus, although its cars will likely not be the only ones assembled in India, the new locations will become a center hub for the carmaker. As already announced, Lotus will continue to be at the center of Malaysia's national carmaker development strategy.