Tuesday, 31 January 2012

Proton-Lotus: To sell or not to sell?

Earlier today, I was asked by cable news channel Astro Awani to comment on the likelihood of Lotus being sold by DRB-Hicom, the new owner of Malaysian carmaker Proton so I told them that any consideration for selling Lotus should be made after considering the British icon in three distinct parts.

This breakdown of Lotus into its three major components is probably the best way to evaluate what Lotus is all about, how to get about taking full advantage of the company and determine whether if any or all of the components are worth holding on to.

If we do not break down the company and have a clear understanding of the components, there is a very high likelihood that Lotus could be misconstrued a major drain on company resources and add nothing to Proton. I think Lotus is a wonderful asset but Proton and DRB need to take a fresh perspective as to what Lotus is.

Thursday, 26 January 2012

Is this the 2013 Hyundai Santa Fe?

Here are some leaked photos of what appear to be alarge SUV from Hyundai, the Santa Fe prototype has been on the loose for a few months now and this does seem to fit the lines of that vehicle.

We have no other details than these pictures

Wednesday, 25 January 2012

VIDEO: Woman delivers own baby while husband drives her to hospital

Amazing calmness while all of this is happening, the woman was not even screaming and even made a phone call a little while later.

Even the baby seems cool about it...WOW

VIDEO: Nissan Juke R bullies Gallardo, 458 Italia and SLS

I think it is time that VAG gets nissan back by building a W12 Audi Q3 and calling the Juke R for a rematch...

Monday, 23 January 2012

Genting to be new host of New York International Auto Show?

Investors in Genting and those who keep a close eye on the money scene in Kuala Lumpur mayknow that Genting's Resorts World received a groundbreaking casino licence in New York in 201 and they are now in the process of completing the new Aqueduct Racetrack casino and multi-development project.

You can read the interesting story of how Genting made the successful bid through the help of lobbyists and local know-who in The New York Times, HERE

Wikipedia puts it;

On August 3, 2010, Lottery officials announced they had acceptedGenting Group's $380 million upfront licensing fee bid, which was $55 million more than the closest bid. Its business model includes targeting flyers stranded at John F. Kennedy Airport. The company said its plans involve 1,200 construction jobs and 800 permanent jobs and will bring the state $500 million a year in revenue.[37]Genting opened the Resorts World Casino New York City on October 28, 2011, with 2,280 gaming terminals.[39]

What we also do not know is that New York's Governor Andrew Cuomo is thinking of moving the New York International Auto Show from the Jacob Javits Centre to his new baby, the USD4billion Aqueduct development.

With that we may have Genting New York LLC hosting the New York International Auto Show

below is the video of the centre as of Oct 2011

GM and VW argues over who has the biggest sales number

Carmakers Volkswagen and General Motors are keen to grab the top spot, especially now that Japanese volume king, Toyota is still dazed from the double whammy that hit Fukushima and Thailand, their two major component supply network.

GM claims they have the top spot with over 9million cars sold and they are also over the moon that Chevrolet sold 4.76 million vehicles in 2011.

VW says that the numbers are not an accurate reflection of the global sales figures because GM includes in their tally, sales of vehicles by associate Chinese carmakers which they do not have controlling interests in.

According to reports, Liuzhou Wuling Motors sold 1.2 million vehicles in China last year and if this number is taken away from GM's global total it would fall behind the VW Group.

All said and done Toyota is expected to shift about 7.9 million vehicles this year, six per cent less than in 2010 while VW is expected to move 8.39 million vehicles this year.

The Renault-Nissan Alliance may be able to claim 8.03 million in sales if you count them as one company and include AutoVAZ sales into their pool, Renault has 25-per cent stake in the Russian company.

Further controversy may cloud third place on the list, as the Nissan-Renault partnership may have passed Toyota in the rankings, according to the report. That is, if you accept the notion that Nissan and Renault are one company and that Renault's AvtoVAZ subsidiary should have its sales numbers count. Renault has a 25-percent state in the Russian company, notes the report.

Since there's little agreement about what rules should govern the accounting, until one of the top four really separates itself from the rest and pushes its total sales over 10 million vehicles, we will likely continue to see the annual global sales championship end in argument. VW, for what it's worth, seems hell-bent on becoming the undisputed largest car company, having repeatedly stated its intention to top 10 million sales.

Lotus ramps up Indycar programme

Lotus recently announced that former F1 raer Sebastien Bourdais and Katherine Legge will drive for the black and gold Lotus Dragon Racing team in the IndyCar series Stateside.

Lotus is partnering with Jay Penske, the son of US racing legend Roger Penske and his Dragon Racing outfit which has had a strong showing since its launch in 2007.

Claudio Berro, Group Lotus Director of Motorsport: Claudio Berro: "We are very pleased to be able to announce this new and exciting partnership with Dragon Racing today, a team which has demonstrated its potential and which we believe will achieve great success thanks to the Lotus IndyCar engine and the security of a major backer.

"Last year was Lotus' first foray into this prestigious open-wheel series since Jim Clark won the Indy 500 back in 1965. We have a tremendous legacy in this sport, and are determined to become winners again.

"The American market is one of the most important to Lotus in terms of road car sales, hence our aggressive marketing strategies through US auto racing. We believe Lotus Dragon Racing and our other partner teams will give us the best opportunity to achieve our ambitious goals."

Read the full Press release after the jump

Faulty clock spring prompts Kia recall

Kia USA is issuing a recall for the Optima (model year 2006-2008) and Rondo (2007-2008) as a result of faulty clock springs in the steering assembly that may cause the airbag warning lamp to light up and the safety device may not deploy in an accident.

The clocksprings deteriorate with use and may result in a high-resistance situation within the circuit and this will trigger a warning in the system and may cause failure to deploy the airbag when necessary.

Proton had a similar recall a couple of years ago, maybe they share the same clock spring supplier.

There is no word yet about Malaysian cars but keep coming back and we will tell you if there is any update.

Full details of the US recall after the jump

VIDEO: Motorcrosser put on public display of Brass Balls

To be honest, I got the chills from just watching the video of this guy riding on a thin ridge on top of mountain. The ridge is so thin and the sides so steep that a single slip or mistake would send this guy either to his death or life as a breathing vegetable.

VIDEO: Example of an idiot on the highway

This driver was not happy with the car behind him, for whatever reason. There is insufficient context to infer the source of his anger but it could be that he felt he was being followed too closely.

This genius thought it would be a good idea to stop on the fast lane and give the offending driver a piece of his mid....well... just watch and see what happens...

VIdeo: Mercedes says farewell to the airbag

Well, not really but they are saying that we, as drivers may call on airbags a lot less in the future if accident prevention features become common in cars int he coming years.

Mercedes-Benz has a system called Pre-Safe which includes collision avoidance and preparing the car and passenger for impact.

With more cars having the ability to sense and understand the surroundings, accidents may be a thing of the past, but then again driving may also be a thing of the past or limited to tracks and certain stretches of the road

video after the jump

Erosion of Internet freedom, Megaupload founder's cars seized

IN what is considered as a shocking development for internet freedom, the police is starting to haul away the car collection belonging to Megaupload.com's founder Kim Schmitz a.k.a. Kim Dotcom garage at his New Zealand Mansion.

After all, in comparison, the bankers that triggered the 1008 meltdown caused more damage to the world economy than Megaupload ever will but we do not see any of their cars being towed away, apart from small fry Bernie Madoff.

The US crackdown on Megaupload, which began with the trigger of an internet kill switch on the site on Thursday and followed by his arrest the next day has triggered a wave of attacks by Anonymous on various government websites including that for the FBI, which led the attack on Kim.

While the car's which are valued at over USD6million may be considered valuable, many activists believe that the US Government is actually robbing all internet users of their freedom in favour of the interests of big corporations.

Some see this as the trigger for the start of a new information highway, underground and away from Government interference.

In the meantime we will see increased attack on Government websites, which they may use as an excuse for further clampdown on the internet.

Twitter user Elliot Kember got shots of the car being hauled away, the photos on this page are from his flickr page. The full list of cars hauled away and their registration and VIN number is after the jump

Finally, a way to block all cellphone calls in a vehicle

Everyone knows that driving while distracted is dangerous and that an accident needs only a split second to happen but millions of motorists still use their cellphone while at the wheel, some even reply to SMS and read their twitter and facebook messages.

Scosche has come up with a device called Cell Control, which basically blocks all cellphone radio activity within the vehicle by using the short range bluetooth wavelengths.

The system is activated through a dongle that is plugged into a vehicle"s OBD II interface, 

Once activated, no communication is possible unless the system detects a hands free kit, in which case the phone attached to the hands-free kit would be allowed to receive and make calls.

The system starts working when it detects that the vehicle is moving and if the driver tries to remove the device or in any way tamper with it, the system will automatically send an SMS to the administrator.

Sunday, 22 January 2012

VIDEO: How Peel got back on the road

Remember that ridiculous little car, the Peel 50 or something or other that Jeremy Clarkson drove through a BBC office for Top Gear?

Well the company is now making them again, thanks to an investment from James Khan of Dragon's Den fame. now you can actually buy these cars, either with a tiny 50cc petrol engine or an electric motor...

Watch the video of how the company won investment from James Khan in an episode of Dragon's Den after the jump and Jeremy's original Top Gear video of the P50 and there is also a video of the cars going through a safari-zoo in Australia.

Chris Bangle - the novelist

Maybe he has run out of novel ideas or maybe this is a novel idea to get new perspectives on what the future would look like, either way legendary former BMW chief designer, Chris Bangle has come up with a novel, in three parts about the future of car designs.

I remember him explaining that we would only understand the new BMW design after we have seen all the vehicles he had in mind and it certainly took that long for many people to understand his style. In the end he did not stick around in Munich.

This novel is part of his work at Chris Bangle Associates, a design firm based in Italy and you can download the text of the novel at www.chrisbangleassociates.com.

In the novel, Bangle highlighted certain future transportation concepts and he asks design students to come up with illustrations to accompany the descriptions in the novel and the winning designs will be featured in an e-book he plans to publish.

The concepts are interesting on their own, for example;

Cvar- a combination of the words car and avatar and it is essentially a sort of transport butler that puts together temporary vehicles for the owner's use, for example if you need to get to a meeting then the cvar would put together a sort of taxicube (another concept) with the necessary power source or wheelbats ( a self-powered wheel concept that bolts onto vehicle bodies, or something like that), if you need to move heavy items from the DIY shop then the Cvar would put together a pick-up type of vehicle and work out how much power is needed to move everything home.

The winner will also get to visit CBA in Italy.

Thursday, 19 January 2012

VIDEO: A short analysis of DRB-Proton deal

This is a video of the discussion between our Editor, Shamsul Yunos on Astro Awani Agenda on Jan 16.

NOTE: This discussion was conducted in Bahasa Malaysia

Monday, 16 January 2012

Can the turnaround specialist make something special out of Proton?

  • Khazanah selected DRB's proposal for purchasing 42% of their stake in national carmaker Proton
  • Offer price is RM5.50 or RM1.29billion in total
  • DRB-Hicom will make mandatory general offer to other shareholders
  • Deal makes DRB-Hicom a brand owner rather than just assembler, distributor or retailer
  • Turnaround plan expected to bear fruit in 5 to 10 years time
  • Future of Lotus hangs in the balance

In a short Media statement issued at lunchtime, Malaysian sovereign wealth fund Khazanah tied the knot between suitor DRB-Hicom and national carmaker Proton, ending months of speculation that has seen shares in both entities rising steadily - which many say was a sign of market confidence in the abilities of the conglomerate to make something special out of Proton.

Before we go further, these are the million-dollar questions that needs answers, I will not attempt to answer all of them but you may get hints of what I think the answers would be in the following paragraphs:

The million dollar questions are as follows:

  1. Who will be the person in charge at Proton - who will be the MD? Will Datuk Seri Syed Zainal Abidin Tahir stay or will they find a replacement for him?
  2. Will DRB de-list Proton and do all their magic away from the prying eyes of the market?
  3. What sort of wish-list will they hand over to the Government for the RM5 billion that they are expected to spend on the acquisition and future of Proton?
  4. Will Lotus have a position in the new marriage?
  5. Will Volkswagen enter the picture? 

It is no secret that Khazanah has been flummoxed by the car industry and has found Proton a difficult beast to handle and has left it pretty much to its own devices with expected mixed bag of results.

On a positive note, the operations of Proton has seen much improvement, especially in manufacturing with the number of defects plummeting as the management pays closer attention to detail and the workforce find a fresh boost in morale since the appointment of current Managing Director, Datuk Seri Syed Zainal Abidin Tahir.

On a less than salubrious palate, the company is lacking a clear long term vision, not surprising as such long range planning can only be driven by an enthusiastic owner and Khazanah was not an enthusiastic owner.

The result is a crop of current and upcoming models that are meeting market requirements and developed at very reasonable costs and this sits along an unclear strategy over technology and global market goals.

As the management tries to formulate a mid-term global market strategy with the development of cars that meets European and American standards, they are not so committed in pushing for new markets as the move requires substantial financial and political muscle.

The current effort by Proton to produce hybrid and range-extender electric cars under collaboration with industry unknown, Fraser Nash is an example of what happens when there is no clear idea where the company should go in the long run.

Frazer Nash may be a relatively well known small sports car maker from the middle of the 20th century but they are certainly not the top heavyweight contender in the automotive consulting business, far away from the likes of Ricardo, Ilmor, McLaren, Lotus and Porsche.

Frazer–Nash Research Limited is the flagship company of the Singapore-based Kamkorp group which lists its other companies as Frazer Nash Energy Sytems, Metrail and Bristol Cars.

There is no doubt that Hybrid technology is the talk of town and the flavour of the month but it is, by definition, a stopgap technology between internal combustion engine power and electrically motivated vehicles.

Proton's decision to spend more than RM300 million into a stopgap technology that has very little appeal in the local market seems like an expensive kneejerk reaction to current automotive trends and jarring proof that the company is unclear about its long term powerplant strategy.

From what we have heard trough sources inside Proton, the collaboration is problematic and they may not be reaping the rewards for every ringgit that they have sowed.

DRB will need to take out the magnifying glass and apply it to the Frazer-Nash deal and make sure that every cent already paid to the British consulting company is worth it or cut their losses and any links to the Frazer-Nash.

Proton, as it stands, is a Jaguh Kampung or big fish in a small pond that desperately wants to go global but does not have sufficient confidence to make the jump and has not found a strong cheerleader in Khazanah. Truth be told even the Jaguh Kampung title is in question, what with Perodua taking the top sales spot over the last few years.

Proton's overseas market continues to take the cautious approach, thanks to the limited store of enthusiasm within the company.

Khazanah's effort at turning around the company went only as far as recruiting the current Managing Director, Syed Zainal - in the hope that he would do the necessary without the sovereign wealth fund spending any close management attention in the nuts and bolts of the operations.

Syed Zainal was pinched from second national carmaker Perodua thanks to his impressive technical and management credentials where he was credited with improving the quality of cars coming out of Rawang to a level that is comparable to global standards.

Of course, at Perodua, he has the benefit of Japanese support and unwavering committment to quality and  this was clearly not in place at Proton when he arrived and he quickly found out just how much work was needed to make Proton a proper carmaker.

At that time the company had been on a major downturn in terms of sales volume as well as market reputation with every website, blog and news outlets lapping up any bad news they could find about the company and there was no shortage of those.

Morale was low at Proton and they needed a major boost from a strong and charismatic leader and they found some rejuvenation from Syed Zainal for the last five years.

The company has now worked through the majority of their major quality issues and are now enjoying much lower defect numbers out of the assembly line and they are now in the process of regaining public confidence in their products and moving their cars up the value chain with exciting design and features.

That is not to say that they are out of the woods yet, quality wise but at least they can start to see sunlight from their current position.

Even if Proton were to come up with a globally competitive vehicle, the company needs clear, long-term commitment to global market developments and a clear target in terms of its size and sales volume in the worldwide league table.

The South Korean car industry experience, specifically Hyundai Kia is a worthwhile parallel to explore and apply to Proton.

In 2001, journalists from around the world were invited to South Korean to hear Hyundai-Kia announce their Vision 21, the plan to become the world's fifth largest carmaker within 10 years.

This is barely three years after Kia became insolvent and had to be rescued by Hyundai and it is a clear example of how a visionary new owner can and will dream big to make an impact on the global car market.

Bearing in mind that at the time Hyundai-Kia was just barely in the top 10 of global carmakers and had to jump over major names such as Nissan, Honda, Volkswagen and Fiat to get to fifth spot, assuming that Toyota, GM, Ford, Chrysler did not lose their spots.

The big dream that Hyundai Kia had resulted in noticeable quality improvements and the establishment of regional design centres in Europe and United States.

While it is nice to think that Proton could dream as big as Hyundai Kia, we should remember that even in 2001, Hyundai Kia were producing more than a million cars a year and exporting to the US and Europe, although with limited success while meeting much cynicism and criticism.

At the moment, Proton is languishing somewhere in the 30th rung with nearly 200,000 units sold in 2011 or about 30 per cent of the Malaysian market. Export numbers are negligible and has never had any significant impact on the company's bottom line.

For Proton to start registering global presence, the company needs to join the bottom ranks of Japanese mass market carmakers with sales of around 800,000 units a year and if it wants to become profitable as a global player then it would have to register around 1million units of cars annually.

We can see that bottom rung Japanese players like Mitsubishi and Mazda with around 900,000 units of sales per year are just barely keeping their heads above water and are now forced to re-badge and re-brand other models to complete their line-up.

As a regional player, Proton can probably survive by doubling their sales figure to 400,000 units in South East Asia and other developing markets but even this market push will require substantial investment from the owners.

It is understood that DRB-Hicom has earmarked RM5billion for the Proton project and out of that amount about RM2 billion will be cash injection into the company to take it to the next level. Will this be enough?

DRB Hicom Managing Director Datuk Seri Mohd Khamil Jamil is fond of saying that the conglomerate is not a short term player, it looks at low hanging fruits that offer immediate returns and long term potential of any business venture that it enters.

In a candid Media conference last week, without being specific he said there are enough low hanging fruits at Proton to make the purchase justifiable and that Proton is a good company to buy because it has a lot of potential.

It is hard to argue with Khamil's assessment of Proton because the hard work put into the carmaker in the last five years has improved the quality and maturity of the products and this can be quickly turned into sales figures with a revamped and rejuvenated sales and marketing team.

Proton has also invested well in design and engineering capabilities in their effort to develop globally acceptable cars and DRB Hicom will now have to take it to the next step, perhaps by finding a mature and globally noted talent to head the design team at Proton.

We have seen how the fortunes of Hyundai Kia rise to unprecedented levels after they improved quality levels and found their own, distinctive and attractive design identity, thanks to idea injections from Europe and North America.

The fact that DRB-Hicom will spend up to RM5billion of their own money to get hold of Proton and make it work means they are deadly serious about the entire project and their number crunchers would have told them that Proton would not survive as a purely national carmaker selling only on home territory.

Khamil had said before that they have plans for Proton beyond Malaysian shores and they are keen to apply everything they have learnt dealing with a vast constellation of foreign automotive brands to the national carmaker.

It is unclear how far DRB-Hicom  will take their partnership with other carmakers into this venture with Proton but certainly there is a lot of scope for cooperation.

As a small carmaker, Proton is in need of a technology partner and also a strategic partner to allow for platform and cost sharing.

Before a technology or strategic partner can be found, DRB-Hicom will have to put in place a long-term goal for Proton and then only work out the sort of partnership that is best for the national carmaker and from there they will be able to narrow down which industry player to pursue.

Obviously there are speculations that Volkswagen, a major partner of DRB-Hicom may be beneficial to the new marriage and this would not be the first time that the German carmaker would be mentioned in the same sentence as Proton.

Just around the new millennium, Volkswagen and Proton entered into talks for a possible linkage but the negotiations collapsed as they could not find a common cause long enough to span the large gap between what each of them expected out of the proposed joint effort.

Under the current arrangement, DRB-Hicom will assemble Volkswagen cars at their plant in Pekan and they are expected to play a key role in the German make's fast expansion into the South-East Asia region.

With a large pool of automotive executives in their ranks, DRB-Hicom is certainly not short of talent to work with Proton and in many cases the talents have had experience working for the national carmaker in the past.

For example, the head of DRB Auto Group is Datuk Nik Hamdan Nik Hassan, a pioneer with Proton and has three decades of experience handling various brands from Honda to Audi.

Khamil insisted that they are not going to make wholesale changes at Proton once the deal goes through, saying that they will judiciously inject new blood where it is needed and this they will have to do post haste.

After all is said and done, DRB needs to change the way they do the car business, with the acquisition of Proton, they are now a brand owner and they will have to spend a lot more time and money developing the brand and finding new markets for Proton.


As we wait with bated breath the plans that DRB will now draw up for Proton, the other rampant speculation about the national car company will reach fever pitch; how will British sportscar Lotus feature in the national carmaker's future.

With an ambitious five-year plan now entering its second year, Lotus will start spending a large part of the RM1 billion in loans that Proton guaranteed.

The five year plan involves Lotus launching five new models and investing heavily in a new manufacturing facility that allows for metal car production and vastly improved product quality.

The reality is that the RM1 billion borrowed by Lotus will only allow them to design one and half car and invest in a new production facility, the hope is that the first car will do well enough in the market to allow Lotus to roll over some cash into the subsequent models until all five are out to market.

Right now we know that the all-new Lotus V8 engine was successfully fired in October and they expect to have it running in a mule of the all-new Esprit sometime this or next month with the full prototype on road trials in the second half of 2012.

With no clear development updates from Lotus with regards to their new models, the market is nervous and vacillates between excitement and cynicism about the future of the British sportscar brand.

DRB-Hicom will have to evaluate how Lotus is performing and whether it will meet the milestones already set down and whether the new products will be worth the money they are spending right now.

They will also have to decide whether they can sell off the sportscar company company and facilities while holding on to the brand  and research and development arm of Lotus and use it to the advantage of Proton.

The new owners will also have to investigate the value that the Lotus group is enjoying from their association with Formula One and other motorsports series.

If DRB-Hicom decides to hold on to Lotus, the first thing they will have to do is shorten the leash and take closer interest in the running of the Norfolk-based carmaker or they could end up paying for an expensive busman holiday for Danny Bahar and his elite team of highly paid auto executives.

Top brains from Porsche, Ferrari, AMG and Aston Martin have been hired for Lotus and if the Lotus recover plan is slow to take off, Proton could do well to put these highly sought after individuals to work for Proton. It would help to give much needed maturity to the design and R&D facilities in Shah Alam.

Sunday, 15 January 2012

DRB-Proton: Khazanah announcement expected anytime now

The DRB-Proton courtship seems to be coming to an end today with Malaysian Sovereign fund company, Khazanah Holdings Berhad expected to make an announcement regarding the deal.

We will be following this story closely and put together an analysis of how we think they can help Proton move forward.

Proton will see 

Wednesday, 11 January 2012

Diesel sales booming in the US, Hybrid numbers dip 2%

Yet another proof that in the short to medium term, diesel is the real option for real world motorists who want to continue to enjoy their car while saving money and saving mother earth.

2011 sales in the US bumped 27.4% compared to 2010 and this is an example of how people decide with their wallet the best way to protect the planet.

While 27.4 per cent is a nice fat number, the actual number of diesel passenger cars sold in the United States is very small, that is to say they are less than 10 per cent of total vehicle sales, in fact diesel cars account for about 6% of new car sales in the States.

Month (2011 v. 2010)
Clean Diesel +/-
Hybrids +/-
Overall Market  +/-
Aug. 2011
July 2011
June 2011
May 2011
April 2011
March 2011
February 2011
January 2011
December 2010
November 2010
October 2010
September 2010
August 2010

VIDEO: Street racing Gallardo crash

Street racing is dangerous, it may be fun but it is dangerous and one stupid mistake can take out innocent motorists and their families.

In this video a Lamborghini Outing led to some stupid road racing moves and one panicky driver planted his Gallardo's nose into the armco barrier.

VIDEO: Renntech SLR clocks 2.2-second 0-60mph sprint

The theoretical limit for the 0-100km/h or 0-62 miles per hour is 1.7 seconds.

No car can go faster relying on traction of rubber tyres, it's a fraction thing.

the 2.2 seconds 0-60km/h by this 680hp Renntech Mercedes-Benz SLR is faster than the 2.42 seconds clocked by the Bugatti Veyron with all-wheel drive and a shade over 1,000 horsepower

Long wheelbase BMW 3-series spotted in China

It seems that if you can tack on a few inches of rear legroom on any car in China, it would sell better.

The reason? Drivers are cheap in China and the rich there don't like to drive...

and so here we have a long wheelbase BMW 3-series joining the fray for the chauffeur driven market.