PROTON EXORA II

INSTITUT OF POSTGRADUATE STUDIES

SCHOOL OF COMMUNICATION
UNIVERSITY SCIENCE OF MALAYSIA

FACTS
Name

Perusahan Otomobil Nasional Berhad (PROTON)

Year Founded

1983

Founder

Mahathir Mohamad

Subsidiaries

11 Subsidiaries and 11 associated companies

manufacturing, research and development, sales and
service activities.

Adopted Technology

Technology and parts from Mitsubishi Motors

First Car

Proton Saga 1985

First Plant

Shah Alam

Actual Size Of Production

350,000 units per year two plants combined

Revenue For 2010

8227 million RM

Average Revenue From 2006

Till 2010

6571 million RM

International Market

Right hand drive market: New Zealand, UK as well as the

Middle East, South-East Asia and Australasia, but it was
mostly successful in UK

PROTON STRATEGY
As per its Official Website and Annual Reports, PROTON
listed the following values as its core strategy values:

1.

Quality

2.

Customer Focus

3.

Innovation

4.

Team Work

5.

Speed

6.

Caring

7.

Honesty

High
Quality
and
Low
Price!

COLLABORATION/PARTNERSHIP
PROTONMITSUBISHI
1985

SAGA: 1.3 or 1.5 litre

engines. Simpler
model of the Lancer,
a well-established
and popular
Mitsubishi model for
the mass market

PROTON

PROTON + (?)
MISSED
OPPORTUNITIES

2001

WAJA: its first homedesigned model.

2004

Mitsubishi sold off its stake

in Proton. Purchased by
the Malaysian government

EFFECT:
Deteriorating quality of proton products. Customers perceived the
quality of proton vehicles to be better when they were still produced
in partnership with Mitsubishi
Eventually, Mitsubishi agreed to form another alliance
with Proton, but only on a project basis.

To expand its sales

internationally and
domestically, Proton need to
improve its technology.
2004-2014
Discussions with global
automotive original
equipment manufacturers
(OEMs), including General
Motors (GM), Peugeo, Honda
and, more recently,
Volkswagen AG went
nowhere as none.

INDUSTRY REVIEW
PROTON was Malaysia's dominant
auto manufacturer until the
establishment of PERODUA, in the
year 1993.

Now the Malaysian auto market is

dominated by Malaysia's national
cars, PROTON and PERODUA which
jointly accounted for 90 per cent of
the vehicles sold annually.

PROTON VS PERODUA

MAA Vehicle Sales Summary for Proton and Perodua in Malaysia for 2007 and
2008.

INDUSTRY REVIEW - Local

INDUSTRY REVIEW - International

Cars Sold 1985 -2013

COUNTRY

NUMBER

Malaysia

3,500,000

92%

United Kingdom

151,421

4%

China

85,922

2%

Australia

32,936

1%

Singapore

23,950

1%

TOTAL

3,794,229

100%

Summary : only 8% of all sold cars were exported and 92% were purchased in
internal market
Source: (paultan.org - thestar.com.my- bernama.com.my- a4rzero.wordpress.com)

INDUSTRY REVIEW
In the competition, Proton Exora II came in first place in the Extended
Electric Vehicle category (electric cars judged on distance travelling
capacity). Charting success upon success has been the hallmark of our
national car brand. According to an Utusan Malaysia report on December
2012, Proton first model, the Proton Saga, was Malaysia first step towards
being a global automotive player

PROTON Holdings Berhad

Group Managing Director
Dato Haji Syed Zainal Abidin
Syed Mohamed Tahir

INDUSTRY REVIEW
The achievements recorded by Proton over the years are a testament of
its continued efforts to improve. It is with pride that we acknowledge that the
Proton Saga has joined the ranks of world-famous car brands as one of the
car models from a carmaker that had stayed in production longer than many
other car models.

INDUSTRY REVIEW
To date, PROTON is facing severe competition in its home market
as government may remove rules that protect local car makers
when it reviews the 3-year-old auto policy to boost foreign
investment.
This reduction of the protection accorded to PROTON may increase
its difficulties to become market leader again. Although government
has cut import taxes, it still imposes high taxes on locally assembled
foreign cars and this has given protection to national carmakers.

SWOT ANALYSIS
Strengths

Weaknesses

Government support

Good corporate governance

Competitively priced products

Extensive nationwide distribution network

Value of patriotism as Proton is national car-maker

Reputation of poor product performance and

functionality

High cost to expand their operation by advanced

technology

Short history in automotive industry

Vulnerable to increasing material cost (steel, etc)

Opportunities

Threats

Government support

Competitors - local & international brands

High demand on the products

A lot of substitute products in market

Opportunity to grow their business globally

Fast

R&D Development

After-sales services

Collaborations within automotive industry

changing

and

advanced

engineering

technology

Economic downturn decrease of car sales

STRENGTH : EXORA II
Exora II, strength lies in its competitively priced product. Its
extensive nationwide distribution network helps the industry to move
forward with the support from Malaysian government. The company
also has good corporate governance, and highly regarded by many
Malaysians out of patriotism they feel for this country as PROTON is
the national car maker.

STRENGTH : EXORA II
The recent announcement by automotive conglomerate DRB-Hicom
Bhd that it plans to raise RM2bil in funds, mostly to help turn around
wholly-owned carmaker Proton Holdings Bhd, is seen as a move in
the right direction by many.
Proton needs to develop new technology to help keep it competitive.
For any automotive company to survive and be competitive, it needs
to develop new technology on a continuous and consistent basis

STRENGTH : EXORA II
The pricing of its vehicles can be more competitive. However, this
is not the case as the company cant bring down the unit price of
its vehicles as its development costs are spread across a smaller
number of units, unlike many of its foreign competitors.

WEKNESSES : EXORA II
Inexperience, apparently due to short history in car making
certainly could not be an excuse for PROTON to come out with
low quality products. This could cost PROTON very high as over
time, it might jeopardize PROTONs reputation.
Poor product performance and functionality is something that
cannot be allowed to happen and quality always needs to be
monitored and assured to the customers. Other than that,
operational cost and other expenses is always a challenge to any
industry and for the case of PROTON, it is more vulnerable to
increasing raw material cost such as steel particularly.

OPPORTUNITIES
The demand for cars in any segment is always there, except for
more trying times like during economic crisis. There are always
opportunities for PROTON to be a global player. Nobody ever say
that cars should only be manufactured by Japan, Germany and
other western countries though of course these countries have the
reputation of making good cars long before PROTON and Malaysia
comes into the picture.

OPPORTUNITIES
Collaborations within industry players could enable PROTON to do
many things. Through research and development more innovative
products could be invented, and ensure that PROTON as a brand
name remains in the industry.

THREATS
One of the threats is of course from the rivals, the competitors in the
automotive industry. Even Perusahaan Otomotif Kedua (Perodua)
Malaysian 2nd national car maker, set up after PROTON started to
challenge PROTONs market share in Malaysia.
Perodua actually did better in recent years and outperformed PROTON
via their most well selling model so far, MyVi and grab more than 30% of
overall market share. Under policy like AFTA, (ASEAN Free Trade Area)
consumers can have more choices from Honda, Toyota, Chevrolet and
other brands to be selected at a more affordable price

COMPETITORS ANALYSIS
PROTON brand product categories placed itself against its
competitors, namely Toyota and Honda. Product extensions for each
brand are grouped together. Under Luxury category, there is no
compatible PROTON Exora II product as to compare with Toyota
Camry or Honda Accord.
As for compact car category, we put PROTON Savvy, Toyota Yaris
and Honda Jazz in the same group. From here we figure that
PROTON cars are available in almost all product categories as what
the competitors have. In term of price, we see that for most of the
categories, PROTON Exora II is more competitively priced rather
than Toyota or Honda .

CRITICAL ISSUES/ CHALLENGES

The Proton badge today does not carry much brand equity. Many view
Proton as a maker of cars that lack excitement but which are relatively
cheap compared with Japanese or South Korean makes.
Proton's Campro engine, which is the main staple of its product line, is
hardly cutting-edge given today's technology. Proton also lacks an engine
or platform to expand into the SUV and MPV markets, or the 2.0-litre and
above segments. Proton may need to collaborate with a foreign partner
much in the way BMW and PSA Peugeot-Citroen are working together to
develop new engines and technologies.
Rising fuel prices and global warming would dictate the direction of
automotive development, and these are beyond Proton's capabilities
Proton has limited funds for research and development. And the bulk of
its exports are mostly confined to less mature markets, including China
and some Gulf Cooperation Council. A tie-up with a strong foreign brand
will enable Proton to penetrate more discerning markets.

MARKETING PROPOSITION
Based on the above problem identification and
problem analysis, our group has come out with
marketing proposition to mitigate the problems
identified by introducing new concept car known as :

Proton Exora II

MARKETING PROPOSITION
applying new innovations technology
increase in fuel efficiency
environmental friendly concepts
emphasis on convenience and safety

MISSION
Economical providing cars which are affordable, cost efficient
and value for money;
Caring providing customer satisfaction and its social corporate
responsibility as a truly Malaysian car manufacturer and to
enhance its Customer Relationship Management (CRM)
Quality providing a consistently improved product and customer
experience.

TARGET MARKET
The process in identifying the consumer
target for new Proton Exora II is important
due to the fact that consumers tend to have
different brand knowledge structures and
thus they will perceive differently for the
products or services. Proton has successfully
identified their target market, according to the
segmentation bases namely behavioral,
demographic and psychographic factors

KEY PLANNING ASSUMPTION

There are three planning phases in value
The first phase is by Proton choosing the value by adopting
strategic marketing via formula Segmentation, targeting and
positioning (STP)
determine its specific product features, prices and distribution
communicating the value of Proton Exora II by utilising the sales
force, sales promotion advertising and other communication tools
to promote Proton Exora II

MARKETING PLAN & STRATEGY

ADVERTISING
PROTON has used 3 means of advertising:
print advertising
radio advertising
television commercial advertising
With the tagline

YOULL BE AMAZED
KERIANGAN KELUARGA

SALES PROMOTION
To capture the attention of local consumers
PROTON XChange programme allows the consumers to trade-in
their PROTON car with additional RM5,000 to own a brand new of
Exora II
REBATE!
Customer franchise building promotions like car-testing,
demonstrations and noncustomer franchise building
promotions such as premiums

EVENT & SPONSORSHIP

As a main sponsor in the major sports event in Malaysia, PROTON has
actively involved in engaging the public with the events they sponsored.
By being the sponsor for these events, PROTON will be able to
enhance their corporate image dimensions. This step is a soft sell and
a means to improve the public perceptions that is reliable, socialconscious, etc.
For Exora 2, with the current sponsorship event available for PROTON
is many, that will easy to promote for Exora II with advertising program
which collaborate with right events like Formula 1 motorsports at
Sepang, A1 Race Motorsports, PROTONs Football Club to play in the
Malaysian Super League, PROTON Malaysia Super Series Badminton
Tournament, Le Tour de Langkawi and so on to reach the target market.

INTERACTIVE / ONLINE MARKETING

With the advancement in the information technology, PROTON with its official
website, www.proton.com, has managed to capture the market share. Interactive
marketing, particularly, allows a 2-way communications as compared to the
traditional forms which are only one-way.
For the Exora II campaign, customers can simply logging onto the website
www.proton-edar.com.my to do activities for searching, altering information,
inquires and responses to questions and to apply for hire purchase transaction
with PROTON Commerces e-Finance system are immediately advised as to
whether their applications have been rejected or conditionally approved, subject to
the submission of relevant supporting documents.
PROTON has also integrated web strategies with other aspects of IMC programs,
i.e. media advertising. Media advertising in PROTONs website to the internal
advertising in the web portal, such as pop-up flyer and interactive 3-D flash for
different car models.
These advertisements will create a different visual
experience to the online viewers as compared to the conventional media.

CONCLUSION
Overall, the action plans recommended are based on 4Ps
strategies and marketing mix models, is to increase its sales and
promotions, and give more emphasis on continued research and
development to meet the changing needs of the customers. In this
regard it is important that the company to increase its appearance
on print and electronic medians and on internet especially on social
media networks. It is also important to measure the impacts of the
marketing campaign and to take necessary corrective action time to
time to improve effectiveness and efficiency of the campaigns
undertaken

I
I

THANK

YOU