Monday, April 27, 2015

Chery Dreams Global; Proton Goes Nowhere

I read with interest yesterday (Sunday Star, April 26, 2015, p 38) that an upstart auto brand wants to become a global brand.
China’s Chery was only founded in 1997. The company produced their first car in late 1999 and their first overseas sales were to Syria in 2001. Last year, they exported 110,000 cars – marking their twelfth consecutive year as the country’s biggest exporter of cars. And their cars have found some measure of respect because they are in more than 80 countries.
But Yin Tongyue, Chery’s chairperson has big ambitions. He says: “If you want to take the driver’s seat in the global market, brand and quality are the key”. He knows it but then again, any Marketing 101 student can tell him that too.
And Yin is not just saying it. He backed this up by making sure that the company invested more than 7% of their sales revenue each year in R&D over the past decade, with investment reaching 10% in some years. They have even established partnerships with Bosch, Bayer and ten other industrial giants to develop engine technology, new materials and also work on the other links along the industrial chain.
I cannot resist comparing Chery with our very own Proton, Malaysia’s leading car maker.
Proton was established even earlier in May 1983 and the first car rolled off the production line in July 1985. It wasn't a new model. In fact, the Proton Saga was based on the second generation 1983 Mitsubishi Lancer Fiore 4-door saloon and powered by a 1.3-litre Mitsubishi Orion 4G13 engine. In March 1989, Proton went overseas – first to the United Kingdom and subsequently to other markets, and for a brief period, they were even considered moderately successful. After that, the company couldn’t maintain their momentum – and just as quickly they lost ground. At home, they have been overtaken by a younger rival Perodua.
Let me give you the Proton numbers. The numbers for Proton cars sold against market share over the past six years is as follows: Year 2009 (number of cars sold 148,031; market share 27.6%), 2010 (157,274; 26%), 2011 (158,657; 26.4%), 2012 (141,121; 22.5%), 2013 (138,753; 21.2%), 2014 (115,783; 17.4%). Then check out Perodua’s sales which in 2014 alone, totalled 195,600 vehicles.
I have no intention to drown you with more specifics – otherwise, this post will become too lengthy. But take it from me, Proton do not invest in branding nor are they committed to product quality. A short spin of advertisements to herald a new model launch does not help to build brands. In fact, I would not even consider it as worthwhile advertising. And it is rare to find a Malaysian who has anything good to say about Proton. In fact, we all joke about Proton’s quality. Sad but true.
In my DMK1013 class at Sunway University, my first lecture talks about “added value” – it refers to the process, operation, and/or aspect of the product, or service that increases the worth of a good or service in the eyes of a customer. Branding and quality are sources of added value – Business students will have learned this. Except Proton.
Yin said: “Going global is not enough for a company to be an international brand. You have to go in and move up the global value chain to impress customers”. At least, Yin knows more about Marketing than those clueless fellas at Proton.
Alternatively, they can attend my Marketing class. They may just learn something! At least, I will drum into their heads that Marketing is about delighting your customers, period.
On Saturday morning, I was in KL’s Jalan Imbi for the Premier Advanced Toastmasters meeting. I was there to evaluate an Advanced speech from The Entertaining Manual. And I was voted Best Evaluator.

I continued with another Toastmasters meeting at Meteor House, Open University Malaysia in the afternoon where I was also the Evaluator for an Advanced speech – this time, it was the Speeches by Management manual. Again, I was voted Best Evaluator at this OUM Toastmasters meeting.

Decent meetings both and for me, at least, it was indeed a Toastmasters-filled day!

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