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Warning: TT: undefined function: 32FUNDAMENTALS OF ENTREPRENEURSHIP (ENT300)CASE STUDYPROTON HOLDINGS BERHADAUTOMOTIVE COMPANYPREPARED BYFACULTY: APPLIED SCIENCESPROGRAM: DIPLOMA OF INDUSTRIAL CHEMISTRY (AS1154A)SEMESTER: 4GROUP MEMBERS:1. SHALLY ANAK PILET (2018281504)2. DARRON MEDANG ANAK BARING (...

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FUNDAMENTALS OF ENTREPRENEURSHIP (ENT300)

CASE STUDY PROTON HOLDINGS BERHAD AUTOMOTIVE COMPANY

PREPARED BY FACULTY: APPLIED SCIENCES PROGRAM: DIPLOMA OF INDUSTRIAL CHEMISTRY (AS1154A) SEMESTER: 4 GROUP MEMBERS: 1. SHALLY ANAK PILET (2018281504) 2. DARRON MEDANG ANAK BARING (2018269908) 3. TIMOTHY ENTEBANG ANAK GAKKAN (2018299016) 4. MICK GREGORY ANAK JEFFERY (2018446436) 5. FREDDY LANDONG ANAK WILFRED (2018269604)

PREPARED FOR DR SITI MARDINAH BT ABDUL HAMID SUBMISSION DATE 17TH APRIL 2020

EXECUTIVE SUMMARY The original purpose of this case study conducted because of to identify the major problem that are face by the company. We have made a research base on the company that we have choose and identified their company background. In this case study we have choose PROTON HOLDING BHD as our case study topics. The reason why we choose PROTON HOLDING BHD as our chosen company because it is MALAYSIAN made company and one of the successful car manufacturer company in MALAYSIA. So in this research we start with the brief introduction for our case study that are consist of the background of the study that is the background of PROTON HOLDING BHD. Then followed with the purpose of the study and the business problem that the project created to address. Then will be followed by the complete company information. Then it followed by the company analysis and then it followed by the business problem that will be the highlight part of this report. In that section it will explained more and giving more idea of the problem that the company face. And lastly are the recommendation and improvement that can be made to overcome the company major problem. So this are some of the key point that should be consist in this report and will make the contained of this case study report more arranged nicely. In conclusion we hope that this report will giving a complete idea of what we have worked for this research.

INTRODUCTION The purpose case study is to give the walk through for the reader a situation where are presented, when the background information are provided and the description of the solution are given, together with how it was derived. The case study are written to encourage the reader to come up with her or his solution of to review the solution back that was already implemented. The goal of this case study is to give the reader experiences similar experiences that the writer experiences when the researches happened. The study that we choose are the study of the PROTON HOLDINGS BHD that are one of the Malaysia made company that have been the Malaysian National Product. PROTON HOLDING BHD is a Malaysian Automotive company and automobile corporation that is active automobile design, manufacture distribution and sales. Proton was established in 1983 as the Malaysia’s first national badged car company until the exist of another Malaysia’s national car company that called Perodua that was established in 1993 that makes it is the second national car company in Malaysia. The PROTON HOLDINGS BHD headquarters are in Shah Alam, Selangor and operates additional facilities at a place called PROTON CITY in Perak. The PROTON meaning is in Bahasa Malaysia acronym for Perusahaan Otomobile Nasional that bringing the meaning of National Automobile Company in English. This company are founded by our 4th Prime Minister of MALAYSIA that is Tun Dr. Mahathir Muhammad. This company have served the Malaysian people for more than 36 years of bringing a new and affordable car to the people of Malaysia. The car that been produced by the proton company not just served in Malaysia but in other country as well. The other foreign country such as Indonesia, Thailand, Singapore, Australia, United Kingdom, Egypt, Chile, Oman, Mauritius and Turkey. The current chairman of the PROTON HOLDINGS BHD are Datuk Seri Syed Faisal Albar. Now we will see a little bit of brief information of the PROTON HOLDING BHD. Proton was originally a manufacturer of rebadged Mitsubishi Motors or called as MMC products in the 1980s and 1990s era. Proton are produced its originally first indigenously designed although with a Mitsubishi engine inside with non-badge engineered car in the year of 2000 and this make an elevated Malaysia as the 11th country in the world with the capability to design a car from start till finish as a one complete car. Since the 2000, Proton have produced a mix of local engineered and badge engineered car. Proton car are currently sold in at least 15 countries and the majority which in the

Asia region. Proton was originally owned in majority by HICOM, with the minority stakes being held by the Mitsubishi Group members. By 2005, Mitsubishi had divested their stakes in Proton to Khazanah Nasional, and in 2012, proton was fully acquired or owned by the DRB-HICOM. On the 29 september 2017, DRB-HICOM has announced changed to the board of PROTON HOLDING BHD by following of the signing of the definitive agreement with China’s Zhejiang Geely Holding Groups Limited on the 23 JUNE 2017. The Chinese carmaker acquired 49.9% equality in Proton. Proton Edar that is the local distribution for the Proton and Perusahaan Otomobil Nasional Sdn Bhd or known as PONSB. Proton, predominantly reliant on its domestic market, is presently undergoing a transformation process as part of a long-term successful plan, with hopes of returning to profitability and regaining an international markets. Proton's working together with Geely are expected to put back the company on track with the presented much-awaited SUV named Boyue touted to go on sale by end of 2018. So we are going to highlight the purpose of this case study. Actually the purpose of this case study are to acknowledge the background of a company that have accomplished a lot to be successful just like the PROTON HOLDING BHD that are one of the iconic brand in Malaysia and representing the Malaysia brand in automobile industries. This are the reason of this case study are to learn how such as a big company accomplished such achievement by recognizing their background on how their started. Next are to identify the major problem that they are facing in the company, because as we know all company, businesses or even a fast food franchise also face the major problem of marketing although they already become a successful company. There are many problems can occur in a company and a company as big Proton are also included to face their own major problem either the problem on the process of the car itself because of manufacturing cars are not easy as it needs a lot of element that needed to ensure perfection during processing the car from the start to the finish product. Next are the technology problem as we know nowadays the technology are getting more advanced every year and a lot of big car company are competing against each other to make an advanced car just like Ferrari, Lamborghini and other big automobile company. Next up are the product services. The Proton Holding must figure out the ways of the service that will work out for their customer and will make their customer more convenient for their customer.

COMPANY INFORMATION The concept of a National Car was conceived in 1979 by then Deputy Prime Minister Malaysia, Dato' Seri Dr Mahathir bin Muhammad, now Tun Dr Mahathir Muhammad, with the goal of enhancing Malaysian industry. The National Car Project was approved by the Cabinet in 1982, leading to the founding of Proton on 7

May

1983.

PROTON Holdings Berhad (PHB; informally Proton) is a Malaysian automotive and engineering company, involved in the design, manufacture, distribution and sales of automobiles.To the advent of Perodua in 1993, Proton was Malaysia's sole nationa l badged car company.The firm is based in Shah Alam, Selangor and operates addi tional facilities in Proton City, Perak.'Proton'

is

a Bahasa

Malaysia acronym

for Perusahaan Otomobil Nasional (National Automobile Company). In 2020, Proton Holdings Berhad is still led by Dato’ Sri Syed Faisal Albar as the Chairman when DRB-HICOM announced changes to the board of directors on September 29th 2017. Daniel Donghui Li, the Executive VP and CFO of Geely Holding, Dr Nathan Yuning, the Executive VP of International Business of Geely Holding, and Feng Qing Feng, the Group VP and CTO at HK-listed Geely Auto are on the board as well. DRB-HICOM also represented Amalanathan Thomas and Shaharul Farez. The five persons listed are the Proton Holdings Berhad directors. Dr Li Chunrong as also appointed the same day, joining PONSB as Chief Executive Officer (CEO) wit h Dato' Mohd Radzaif Bin Mohamed as the Deputy CEO. For Proton’s main factory, it is located at Shah Alam which is capable of producing 240 000 vehicles per year compared to 80 000 vehicles per year in the early years of its development. Proton Holdings Berhad had partnerships with Mitsubishi and produced Proton cars launched between 1985 and 2000 with the exception of the Proton Tiara which was Proton’s partnership with French car manufacturer Citroën from 1996 until 2000. The partnership between Proton Holdings Berhad and Youngman Automobile Group Co.Ltd produced some of Proton’s most know car that is the Proton Gen-2 and the Proton Persona. On 29 October 2012, Proton entered a collaboration with Honda Motor

Company.Ltd. Both

companies

have

agreed

to

explore

collaboration opportunities in the areas of technology enhancement, new product line up and the sharing of vehicle platforms and facilities. The result of the collaboration, the second generation Proton Perdana, was unveiled on 11 December 2013 at an official ceremony in Putrajaya. Proton Holdings Berhad have

produced 20 different car models since its establishment. Some of the current model line up is the Proton X70 (2018-present), Proton Iriz (2014-present) and the Proton Saga (1985-present). It was very surprising that the Proton Saga had been remodelled a few times and still stands proudly as Proton Holdings Berhad’s most oldest

car

model.

Proton controls a large share of the domestic passenger car market and over the ye ars has set up distribution networks across the four regions which

is South

East Asia, Middle East, United Kingdom / Western Europe and Australasia in main business centers. The main business activities of Proton’s marketing group encompass vehicle engineering, research and development, manufacturing, distribution

and

after-sales

services.

Proton has commanded the local automotive market. It is imperative that Proton keeps its focus firmly on the road ahead. With its expanded product range, improved quality and value for money product positioning, the Proton brand will become increasingly attractive. However, Proton cannot depend solely on the domestic market to grow. Yet Proton cannot rely solely on increasing domestic market. To prosper and survive, Proton must further expand its export capacity, as indicated in the previous year's study. Tangible and sustainable growth in the international market will be the mainstay for Proton as it aims to expand its market share and sales volume in the export markets. Proton will be driven by real and sustainable growth on the international market as it seeks to increase its market share and export sales volume. In particular, the Chinese automobile market remains a very important market for many car manufacturers. Towards this end, Proton has identified contract manufacturing for other OEMs interested to enter this region as a possible means to supplement its own manufacturing volumes. As for financial achievements, Proton has made profit for 2019. Dr Li told that Proton is indeed back in the black, spurred by strong domestic sales. However, the Proton CEO could not disclose any figures as Proton is part of DRB-HICOM, which is a public listed company. The company announced earlier that it sold 100,821 units (domestic plus export) last year, an increase of 55.7% over 2018 figures. That’s also good enough to give it an overall market share of 16.7%, the highest since 2014.

COMPANY ANALYSIS Proton cars are produced by Malaysian-based company based on the design, manufacture and distribution of automobiles. The company was started in 1983, and is located in Shah Alam, Selangor. Their external job is done in Proton City. The name of the company is an acronym that correlates from Malaya to the National Automobile Company in English. The company was first under Mitsubitshi motors, but they have been operating on their own since the 2000s. Proton is primarily involved in the Malaysian economy, but has expanded to 15 countries especially in Asia. The share of the business is expected to adjust in the years to come. The president of Proton cars is Datuk Seri Syed Faisal Albar. STRENGTHS IN THE SWOT ANALYSIS OF PROTON CARS All the positive and constructive important points of an organization that led them to become a very profitable business are from their own best qualities. Here’s the power of Proton Cars: 

National Auto Mobile Manufacturer of Malaysia: this is giving the company both a solid reputation and as well as loyal customer base. It is partly due to their 34-year-old background and therefore the advances in technologies they provide in their automobiles.



Authentic quality and reliability and even state-of-the-art technology: the company utilizes Japanese technology to somehow drive its vehicles. Cars are very pleasant to the user, and they do not dig a hole in their pockets either. Cars can be used convenient every day without any problems. Cars are strong and durable and have a promise that they are going to work for long time.



Value for money: Proton cars are aimed specifically at the upper middle class community that wants to buy a vehicle. Cars have been planned in that kind of way and that they have generally excellent supplies and equipment, but they are not all over the mark. The customer gets just what they are going to be paid for, and most of the time they are actually happy with their car.



Conveniently available: Proton cars are easily obtainable mostly in Malaysia and sometimes even people can go for it wherever they want. They mainly

target the United Kingdom from all around the world, though cars can be seen to be there already. 

Expanding on a global level: throughout a longest time, the business has been tied to its regional market, but today they are improving their game. Several of the countries where they would have previously established are the United Kingdom, Australia, Singapore as well as other nations. They have already exported about 400,000 units worldwide, of which 141,209 were already in the UK itself.

WEAKNESSES IN THE SWOT ANALYSIS OF PROTON CARS Weaknesses are the weak aspects of a business that they ought to focus on as quickly as possible, so therefore a stronger change can be achieved in the market. Following are amongst of the shortcomings in Proton’s cars: 

Less number of products: although Proton seems to be reasonably priced, they do not always have much selection. At such a time, that there are about eight models available ranging around the same price. So they will still probably rely so much on a varied list of items.



Fewer access to the global market: just because they are focusing solely on it, there is still so much more access. They have not yet entered big markets in Asia, and many other countries, something they will soon need to do.

OPPORTUNITIES IN THE SWOT ANALYSIS OF PROTON CARS

Chances are areas on which a business has to work to make any meaningful improvements. Here are some of the incentives that Proton cars can take advantages of:



Introducing super cars: they will certainly focus on launching some massive budget vehicles. It will make a difference to aim the upper class of community and that it will ultimately push the company to the fore. Using a range of models also helps a business a lot.



Expanding their market: this is an apparent argument, as expansion leads to attention. They should certainly try the major Indian and U.S markets to

attract more customers. They should introduce field-specific models to help them develop a concrete market. They can also grow further in their home market by further vehicle choices and better ads. 

Launching hybrid electrical cars: as fuel prices rise, so does freight to the customers. In the near future, the company really ought to introduce hybrid cars in order to stay competitive on the market. Electrical cars are environment-friendly and support people who are in tight margins. Company throughout the globe have already begun projects on the same subject.



Implementing other kinds of vehicles: Proton cars are somewhat mainstream however as an auto mobile company they still have to broaden themselves. The introduction of vehicles such as motorbikes will further boost the business because there is a massive market for them.

THREATS IN THE SWOT ANALYSIS OF PROTON CARS

Threats are factors that can damage a business and should be disregarded as swiftly as possible. Here are some of the risks to Proton Cars:



Increase in fuel price: a serious issue facing the world as a result of inflation. As it has the greatest impact on Asian markets, that is a potentially threatening ultimate point.



Competitors: Proton competitors such as Perodua are already on the rise, attempting to sell much more cars. Due to the large market, foreign brands are also approaching the Malaysian market.

BUSINESS PROBLEM A) Major Problem The main business problem of PROTON Holdings Bhd is the Malaysians are not supporting PROTON, a product made for our national pride. Malaysians are more interest about the international products in the perception of a high quality such as Toyota, Honda and etc. The public also didn’t support the local engineering and employees because they doubt the quality of Malaysia. While Proton car was established in Malaysia, they do not have the skill and technology to run this business swiftly. That why they hired technology and skill from Mitsubishi Motors Corporation. As the technological and knowledge shifted they started to produce on their own effort from skill they gained. This means, Proton Car Corporation is depended on the skill of the labor. Therefore they must give them some rights to motivate them and increase the profitability. Conflicts are in generally conflicts of interest. That means conflicts may additionally lies on the relationship of employees and Proton car. As most of the personnel are Malaysian and Proton automobile is Government enterprise and supervised with the aid of the personnel of Mitsubishi Motor Corporation it turns into hard for the local personnel to be supervised with the aid of others who are not belongs to this organization. As for example, marketing department may want a huge budget for the promotional activities of the brand but finance department may minimize the costs by cutting the budget of marketing department. On the other hand there may also conflict between the organization and shareholders. As for example, as Proton car received huge government assistance on tax and others sections shareholders may want a good premium from the organization, giving less premium may also be a reason for conflict. The motto of Proton car is “We charge the exact opposite as our equally rubbish rivals, Electron Cars!” This motto expresses the marketing strategy of Proton Car. They give emphasis on the price advantageous production of the product. As Malaysia is a growing country this strategy suits very much with the market. And as a end result they grew to be market leader of Malaysian car industry in a very short time. Over 42% of complete equity o...