AAPICO Teams Up With PROTON Via A RM140M Stake Acquisition In AVEE Global

PROTON, Malaysia's national automobile manufacturer, is striving to become the country's leading automotive brand. To achieve this, PROTON has teamed with AAPICO Hitech Public Company Limited (Aapico) to manufacture numerous vehicle components through its subsidiary, Advance Vehicle Engineering Global Sdn Bhd (AVEE Global). Aapico will acquire a 60% ownership in AVEE Global from PROTON as part of the agreement, while PROTON will keep a 40% stake, and the firm will be renamed Aapico Avee Sdn. Bhd.

The cooperation was formalised on June 26, 2023, and it entails an initial RM40 million investment from Aapico into AVEE Global's facilities, with plans for additional development to suit the expanding demand for PROTON vehicles and the wider automotive sector. An additional RM100 million investment is planned for 2024, which will be utilised for facility expansion and the purchase of new machinery.

Aapico, one of Thailand's major auto parts firms, will use its skills and experience to improve operations, introduce new technological applications, and more efficiently create high-quality components. The growth will also result in greater job opportunities and the attraction of highly skilled professionals to Malaysia.

Yeap Swee Chuan, CEO of Aapico, expressed excitement about the relationship, citing high demand for PROTON vehicles as well as solid economic growth in the automotive industry. Aapico intends to provide world-class car parts to PROTON while also supporting the company's objectives for domestic and international expansion.

PROTON's partnership with Aapico increases its presence in the ASEAN automobile sector. The firm intends to become a major participant in one of the world's fastest-growing automotive markets by combining Aapico's economies of scale and investment plans with PROTON's current technology, such as hot press shaping of body pieces.

PROTON CEO Dr. Li Chunrong emphasised the partnership's benefits, which include cost savings, increased efficiency, and improved product quality. As PROTON's volume grows and new models are introduced, the firm strives to keep its products competitive in terms of features, quality, and safety.

The Minister of Investment, Trade, and Industry, YB Senator Tengku Datuk Seri Utama Zafrul bin Tengku Abdul Aziz, was present for the announcement of the joint venture. The investment supports the ministry's goals of fostering long-term economic growth, enhancing competitiveness, and creating high-skilled jobs in the manufacturing sector. The automobile industry and allied industries contribute significantly to employment and Malaysia's GDP.

This is Aapico's second endeavour in Malaysia's auto parts market. Earlier this year, the company established Purem Aapico Sdn Bhd through a joint venture agreement with Purem, a global exhaust systems supplier. This collaboration will cost RM30 million and will begin selling exhaust systems to PROTON in the third quarter of this year.

Yeap expressed hope that these early investments will herald the start of a long-term cooperation with PROTON, as Aapico seeks to support PROTON's role in building Malaysia's automotive ecosystem. Aapico's previous presence in Malaysia was through the ownership and operation of six vehicle dealerships, four of which were PROTON dealerships. Aapico currently operates 33 companies in Thailand and 14 companies in other countries (Portugal, Germany, London, China, India, Malaysia, and Singapore), employing over 5,000 people.