The ever-crowded affordable SUV segment sees new entries on an almost monthly basis, but Proton could be the first casualty of the saturated segment following the Chinese-owned automaker’s return in 2022.
Image: Proton
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Malaysian automaker Proton’s presence in South Africa faces an uncertain future as market dynamics and operational challenges may prompt a reassessment of its local strategy. The automaker re-entered the South African market in 2022 through a partnership with Combined Motor Holdings (CMH), introducing models like the X50 and X70 SUVs. However, recent developments suggest a potential withdrawal. CMH CEO Jebb McIntosh indicated that the remaining Proton inventory, which is limited, is expected to be sold by the end of August 2025. Following this, CMH and Proton will evaluate the brand’s future in the country.
Before we delve into why, it is worth noting that this is déjà vu, considering the automaker has previously pulled out of the country once before.
Proton (short for Perusahaan Otomobil Nasional) was Malaysia’s first national carmaker and was established in 1983. It utilised platform shared Mitsubishi products that wore the Proton badge, but the Malaysian automaker eventually merged into in-house engineering and design, which heralded a new era for its existence. In the 2000s, when Proton saw its Zenith, a decision was made to expand globally, resulting in the introduction to the South African market in 2004. Affordable models like the Saga, Gen 2 and Arena bakkie served as the bread and butter and during the time, it acquired British sports car maker Lotus. A decade after its arrival locally, its financial struggles and increasing competition resulted in its cessation of operations in South Africa in 2015.
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In 2017, China’s Geely acquired a 49.9% stake in the brand, which ushered in the era that the automaker is currently in. Using the backing of Chinese technology, this would focus on modern platforms, tech, and global expansion. This is where key markets like South Africa fit into the equation, with models like the X50 and X70 SUVs critical to Proton’s attempt at a global comeback, including its 2022 re-entry into South Africa. In a strategic move to re-establish its global presence, Proton announced its return to South Africa in April 2022. This comeback was facilitated through a partnership with Combined Motor Holdings (CMH). By May 2022, Proton had shipped its first batch of vehicles—including the X50 and X70 SUVs, as well as the Saga sedan—to South Africa, marking the brand’s official re-entry into the market.
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The relaunch event in September 2022 served as a loudspeaker preaching Proton’s commitment to the South African market, with plans to establish 25 dealerships within six months. With limited successes in the Southern African market, there is a very sobering reality that for a second time, Proton will cease operations in Mzansi. While the CMH CEO has made his voice heard, CAR Magazine has been unable to reach Proton South Africa’s office for an official statement. This potential likelihood comes as a result of mounting Chinese and Indian automotive brands’ competitiveness, which have gained significant traction in the South African market. This pressure has made Proton’s operations more challenging and costly, leading to these considerations about the brand’s viability in the region.
CAR Magazine will continue attempting to get int touch with Proton South Africa to ascertain an official statement.
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