Volkswagen said Tuesday its talks with the Kuala Lumpur government on taking a stake in Malaysian car manufacturer Proton had collapsed and the German company would seek other ways to boost sales in Southeast Asia. After earlier fruitless contacts, the two sides resumed negotiating and spent several months discussing terms for Volkswagen either to obtain equity in or cooperate with the struggling factory, which was originally set up by Kuala Lumpur as a prestige project. A statement from Volkswagen offices in Wolfsburg, Germany, said both sides had decided not to pursue their talks with one another for the time being.
It said Volkswagen would review other means to boost its Southeast Asian business and would further step up its sales operation in the region. The objective remained to establish both factory capacity and a distribution network for long-term success in Southeast Asia. Volkswagen, Europe's top maker of volume cars, is undergoing rapid change as sports car manufacturer Porsche, its principal shareholder, brings the bigger company under tighter control. There have been unconfirmed news reports that Porsche aims to cancel unpromising projects at the group, which sells cars under the Volkswagen, Audi, Seat and Skoda brands. -Autosaloon bring you to the limit