style="text-transform: uppercase;">Kuala Lumpur: Proton Holdings Bhd today signed a memorandum of understanding (MoU) with Indonesia's PT Adiperkasa Citra Lestari (PT ACL) to help the latter develop and manufacture an Indonesian National Car. Under the MoU, a six-month feasibility study will be conducted to explore specific areas of cooperation between both companies, including the potential development and manufacture of the car in Indonesia.

Subject to the completion of a successful study, Proton and PT ACL will also signed a definitive joint venture (JV) agreement for the proposed project.

Proton Chairman Tun Dr Mahathir Mohamad said the MoU was the result of discussions between Prime Minister Datuk Seri Najib Tun Razak and Indonesian President Joko Widodo.

"We have to work out the JV agreement. I cannot anticipate what it will entail. But obviously, Malaysia is not going in to lose money. We also want to gain something from it," he told reporters after the MoU signing ceremony here Friday.

Najib, Widodo and Mahathir witnessed the signing. Also present was the Malaysian Ambassador to Indonesia Datuk Seri Zahrain Mohamed Hashim and the Indonesian Ambassador to Malaysia, Herman Prayitno.

Signing on behalf of Proton was Chief Executive Officer Datuk Abdul Harith Abdullah, while PT ACL Chief Executive Officer Abdullah Mahmud Hendropriyono, signed for the company.

Widodo spent almost an hour visiting the Proton plant and tried out the Proton Iriz model, driven by Mahathir.

"I talked quite a bit with President Widodo and he seemed to be pleased with what he saw and experienced," said Mahathir.

He added that the study will also look into Malaysia and Indonesia's contribution and maximise benefits for both countries.

"We have to see if Malaysian cars can be modified or be suitable for the Indonesian market.

"Initially, we may export the Malaysian made car. Subsequently, we will assemble the car in Indonesia and then progress towards producing parts in that country, so that it will become a real Indonesian car," he said.

Mahathir said Proton started with only 18 per cent local content and now the carmaker was involved in manufacturing, designing and producing prototypes that comply with strict international automotive standards.

He was of the view that the JV may also serve as a platform for an Asean car.

"But for this, we have need the consent of all the Asean countries, as well as open up for investments by them for ownership of the car," he said.

When asked if the JV can compete with other automotive giants, Mahathir said it would not be unusual for Malaysia and Indonesia to consider protecting the infant industry, when it materialises.

"When you are a baby you need somebody to hold your hands," he pointed out.

Meanwhile, Abdul Harith said the collaboration would be good for both nations, specifically in working together to develop products for the larger market.

"Proton has also the facilities, capabilities and technology know-how and is the only company in the Asean region with an in-house research & development facility.

"At the same time, no other country in this region has their own national car project other than providing manufacturing and assembly services," he added.

As for PT ACL, Abdullah Mahmud said the MoU was a major development for the Indonesian automotive industry.

"If the collaboration materialises, not only will it spur the industry, but also offer wider job opportunities for the people," he added. – Bernama