KUALA LUMPUR -- Malaysian automaker Proton Holdings announced Wednesday that Mahathir Mohamad, the country's former prime minister, has assumed the role of company chairman.
Despite being out of public office since 2003, Mahathir retains huge influence among regional governments and government-affiliated corporations, lifting Proton's hopes that the 88-year-old chairman can help rev up the automaker's sputtering sales.
Proton was set up in 1983 to realize then-Prime Minister Mahathir's vision of a national car. Supported by tax breaks and other measures that made the car affordable, Proton rose to capture over half of the Malaysian auto market in 2001. But it has lagged since then and remains stuck in the slow lane with a share of around 20%. The company has been lapped by Malaysian carmaker Perodua, and critics cite technological deficiencies as a reason for sluggish sales.
With its back against the wall, Proton has turned to Mahathir to formulate business strategy and supervise negotiations with the government.
But because it has driven solo since cutting ties with Mitsubishi Motors in 2004, it is unlikely that Proton will follow Perodua's lead and team up with foreign interests. And although Malaysian bank CIMB sees a strategic partnership with foreign capital as essential for Proton, Mahathir remains a staunch believer in the need to protect domestic manufacturers and does not want foreign interests to have a hand in management.