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Hero-Proton Might Tie-up for Passenger Car

By Motortrend India Staff   |   11 October,2009

Hero Group, a $4-billion company, might bring out a passenger car very soon. The company is in talks with Proton Holding, Malaysia's national carmaker to manufacture cars.


Proton is in the final stage of talks with Hero Group to make cars in India. It has now been a few months since both the companies are in talks and there is a high chance that they might start a joint venture.


The Hero Group together with Honda Motors Japan is the world's largest two-wheeler maker by volumes. The group owns 26% stake in Hero Honda and sells more than half of the motorcycles that has been sold in India.


"Proton officials came and met us earlier, and there's nothing more to add," said Sunil Kant Munjal, chairman of Hero Corporate Service, who manages commercial joint ventures of the group.


Nothing much about the partnership is clear, but it is expected that Proton could look an arrangement similar to the one it has in China.


Proton's Shah Alam and Tanjung Malim plants in Malaysia as well as its auto design subsidiary Lotus in the UK, where Proton's sports car and engineering unit are based, are already been visited by senior executives from the Hero Group.


"Proton is keen to team up with Indian companies to produce small cars here. They tested their cars on Indian roads last year. They have gone through all these stages, and now, they are entering into final stages before getting into any agreement," said the Malaysian High Commission official.


It has been over a decade since Proton is trying to enter the Indian car market. The company is expected to launch its flagship 1.3-litre Saga sedan and the 1.2-litre 5-door compact car Savvy and the 1.6-litre second-generation mid-size car Persona for the Indian market.


"Our focus is to foray into developing markets likes China and India, which offer great potential for our smaller models," he said, requesting anonymity.


"Proton is keen to team up with Indian companies to produce small cars here. They tested their cars on Indian roads last year. They have gone through all these stages, and now, they are entering into final stages before getting into any agreement," said the Malaysian High Commission official.



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