Proton has inked a deal with one of Thailand's largest automotive parts suppliers, Aapico Hitech for the joint production of body and chassis parts for both Proton and other automotive manufacturers.

The joint venture, worth approximately RM 140 million, will see Aapico Hitech acquiring 60 percent of Advance Vehicle Engineering Global (AVEE Global) - Proton's subsidiary for manufacturing tooling and body parts - while Proton retains a 40 percent share in the company that will be renamed as Aapico Avee S.B.

The partnership, which was formalised on 26 June 2023, sees Aapico making an initial investment of RM40 million into AVEE Global's 20-acre facility in Tanjung Malim, with plans for further expansion to cater to the growing demand for Proton vehicles and the overall automotive sector.

Another RM100 million in investment is planned for 2024, for plant extensions and the acquisition of new machinery.

The operational manufacturing facility will soon be ramping up its production volume with new products in the pipeline. Bringing its vast experience and expertise, Aapico will be managing operations and introducing new technology applications to produce better quality parts, improve production and cost efficiency.

The future expansion will also see the development of human capital with more jobs being created and attracting highly skilled talents to the country.

"As our volume increases in tandem with our model introduction plans, we will continue to work to ensure our products are on par with the competition in terms features and quality while continuing to offer outstanding safety from the use of technologies such as hot press forming," said Dr Li Chunrong, CEO of Proton.

For Proton, the JV further strengthens the company's ambitions to become a major player in the ASEAN automotive market. By leveraging on Aapico's economies of scale and investment initiatives and combining it with Proton's own existing technologies in areas such as hot press forming of body parts.

Mr. Yeap Swee Chuan, President & CEO of Aapico Hitech said, "Aapico is taking the opportunity to enter the auto parts manufacturing sector in Malaysia at this right time, with promising growth expected in the automotive industry led by strong demand for Proton vehicles and further supported by strong economic growth."

"We aim to bring our expertise and manufacturing technology into the partnership and deliver world class auto parts to Proton and support their expansion plans in both the domestic and export market." He added.

The Aapico-Proton strategic partnership is Aapico's second venture in Malaysia's auto parts sector. Earlier this year, the Thai company signed a joint venture agreement with Purem, one of the largest exhaust systems suppliers globally.

With an RM30 million initial investment, Aapico holds 49 per cent ownership while Purem holds 51 per cent of Purem Aapico Sdn Bhd, which will produce exhaust systems and will begin supply to Proton in Q3 of this year.

Prior to this, Aapico's presence in Malaysia was through the company's car dealership business where it owns and operates six car dealerhips in Malaysia including four Proton dealerships.