Here’s Why Proton is Set To Join the Disruptive Drive

Why Proton is Set To Join the Disruptive Drive Uber ride hailing Geely Volvo electric self driving taxi

The Interview

On May 9, Uber Malaysia’s general manager Leon Foong told business radio BFM that Uber and national carmaker Proton is discussing a potential partnership. While there are no further details available yet, there are several possibilities in the air.


Uber Proton Partnership

The more likely scenario would be for a special sales arrangement between Proton and Uber. This would be a natural continuation of the special incentive announced last October by prime minister Datuk Seri Najib Tun Razak when tabling the 2017 budget to encourage more low-income earners to join ride-sharing services.

A possible arrangement may echo previous Uber efforts to reduce car ownership costs as it aims to get more drivers on the roads.

The second possibility is that Proton may be looking to tap into Uber’s capabilities as it expands into the ride-sharing space. Leveraging on Uber’s app for the processing engine and user interface would be a strong technical solution for Proton as opposed to developing its own equivalent.

The third and more exciting possibility is Uber may also be negotiating a potential bulk purchase of Proton cars. The objective may be to unveil a taxi fleet in Malaysia.

It is not unprecedented as Uber has dealt directly with car manufacturers and other fleet owners in the past. Among others it has separately tied-up with GM’s car-sharing unit Maven in San Francisco and another car-sharing service Zipcar in Boston.


The Outstanding Bill

Any one or a combination of these possibilities may be the reason why Malaysia postponed much-anticipated legislation changes to regulate ride-sharing last April. In the same month, Taiwan came to a resolution on its own legal standoff with Uber.

To recap, proposed amendments to the Commercial Vehicles Licensing Board (CVLB) Act 1987 and the Land Public Transport Act 2010 were meant to impose a licensing requirement on ride-sharing drivers.

If preparations on Uber and Proton’s side of things conclude soon, the proposed amendments may be pushed through in the next Parliament sitting which begins July 24.


Uber’s Self Driving Electric Taxis for ASEAN?

This will be a space to watch, especially if the third possibility mentioned materializes. On May 23, Chinese carmaker Zhejiang Geely Holding Group Co signed a deal to buy 49.9% stake in Proton.

The entry of Geely opens exciting possibilities for Proton, especially in the context of a potential partnership with Uber. Recall that Geely owns Volvo, which is collaborating with Uber on self-driving technology.

And last September Uber launched the first self-driving taxi fleet in the US beginning with Pittsburgh, where it aimed to have dozens of self-driving cars by end-2016.

Also Geely owns the iconic London black cabs via the London Taxi Company. Last March, Geely opened a £300m plant in Coventry to manufacture electric versions of the black cabs. This is part by a government push to have all black cabs sold in the U.K. to use electric technology beginning January 2018.

Read Daimler to Supply Self-driving Mercedes-Benz Vehicles on Uber’s Network

That said, self-driving cars or electric taxis in Malaysia may be a very far-fetched scenario for now, though not entirely impossible — while Grab is working with nuTonomy to test self-driving vehicles, Uber does not yet have such a partner in ASEAN to test autonomous technology in a right-hand drive traffic environment. Who knows?

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