Volkswagen looking on to make Malaysia its global parts sourcing hub

According to Andreas Prinz, the managing director of the Malaysian distributing arm for the German carmaker, the Volkswagen Group Malaysia Sdn Bhd, the next few months will see the company setting up a small department here by its global sourcing unit. He said “They will not be looking only at the Malaysian market but use Malaysia as a sourcing hub for worldwide production,”

This was revealed on the day they launched the 3 new highly anticipated models, the Volkswagen Passat CC, Scirocco and Golf GTI Mark 6. This is not the first time VW has been linked with a part-deal with Malaysia where Proton was reported to be interested a few years ago but the deal fell through but of late, even DRB-Hicom Bhd has joined in the fray as well.

Prinz added that “We not only want to fulfil the 40 per cent local content requirement but also see the market as a really good sourcing opportunity for worldwide production. It is an independent programme from the CKD. Malaysia is the second biggest car market after Thailand but it is the biggest passenger car market. This is why we are really keen to grow our business here. Over a medium-term, the company was quite optimistic that the 40 per cent local content can be achieved.”

He also added that Singapore was initially the first option but Malaysia possessed the ready market as well as the experience and expertise in car-making which eventually became the company’s best option. He also commented that a decision will be made by the end of the year on CKD. “We are keen on entering the market but we have to see how it will be materialised. We need incentives from the government and then we have to achieve the local content. We have provided the government with a fairly huge wish list. So we will see what will be their response,”

At the moment, they have yet to decide on the number of units the CKD programme would roll out “We have not decided yet. I don’t want to comment on it. It is still in a working progress. There are different scenarios that we are working on. It depends on the whole package (incentives) that we are getting and then we have to work out between different scenarios,”

And the golden question on whether Proton is the frontrunner for partnership with VW, he simply answered “Currently in the automotive industry, everybody is talking to everybody, but we are focusing on CKD.”