Tuesday, December 12, 2006

Volkswagen/Proton talks pick up

Word on the street is that Volkswagen has resumed talks with Malaysian automaker Proton for a joint venture and, possibly, a 51% stake in the company. Things seemed uncertain for a while when Volkswagen, back in the beginning of the year, killed off talks with Proton. That has all changed now, it looks like, in a big way. Volkswagen is said to possibly be considering doing an audit of Proton, which can be translated that Volkswagen is serious about a Proton joint venture after all.

Proton isn't the only party that will reap the benefits of this venture, namely a much needed dose of cash. Volkswagen will gain access to Proton's plants in Malaysia and Malaysia's free trade agreement with Japan. That translates to Malaysian-made Volkswagens that will be imported into Japan tariff-free. Not a bad deal if you ask me.

Either side has declined to comment on anything about each other. If these talks are true and are indeed going on, we will know about it soon.

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