Geely withdraws Proton/Lotus bid, leaving Peugeot parent as only suitor
An Conghui, Geely's president, confirmed the news to the South China Morning Post, although he didn't tell the newspaper why Geely decided to withdraw from the bidding process.
Li Shifu, Geely's chairman, complained to Bloomberg earlier this month that Proton "haven’t decided what they want", and that the company was considering pulling out of a potential deal.
Above: Lotus Elise Sprint.
Prior to its withdrawal, Geely was widely seen as the candidate most likely, and was said to be most interested in the technologies and engineering expertise offered by Lotus, a subsidiary of Proton.
With Geely officially out of the frame, the PSA Group is the only car maker with a registered interest in Proton.
The PSA Group recently completed a deal to purchase the Opel and Vauxhall brands from General Motors, as well as most of the American automaker's European operations. That transaction is expected to close by the end of 2017.
Once Opel and Vauxhall become part of the PSA Group, the French car maker will have a market share of around 17 per cent in Europe, second behind the Volkswagen Group on 24 per cent.
Just a few days ago, members of the Peugeot family told Welt am Sonntag that the Opel/Vauxhall takeover would give the PSA Group sufficient scale in Europe, and was just one part of its plans to “conquer the rest of the world step by step”.
Above: Opel Insignia Sports Tourer.
If PSA Group does gain a stake in Proton, it will likely use its new partner to gain better access to the South-East Asian market. With its production facilities in Malaysia, Proton is able to sell cars tariff-free across ASEAN.
At present, it's estimated that Proton has the ability to produce between 400,000 and 600,000 cars per year, although it only sold around 120,000 vehicles last year.
DRB-Hicom, Proton's parent company, has indicated that it would like to choose Proton's new partner by the end of the first half of 2017. The Malaysian conglomerate would like to keep a stake in Proton, although it's unclear if it wants to retain control.
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