SUBANG JAYA: Automotive group MBM Resources Bhd is open to collaboration talks with foreign carmakers who want to invest here, says group managing director Looi Kok Loon.
“We could either supply components such as airbags, seat belts and alloy wheels to them, including tyres, or jointly set up a plant here to assemble cars.
“There will always be opportunities for us to work with foreign car makers, especially to set up facilities here as we are a diversified group,” he said after MBM’s shareholders meeting, here, yesterday.
MBM, through its unit Federal Auto Holdings Bhd, is in talks with SAIC Motor Corp Ltd, China’s largest listed vehicle manufacturer, to revive the MG brand here, which may also lead to the local assembly of MG cars.
SAIC acquired the MG marque in 2007. Its wholly-owned unit, MG Motor UK Ltd, is based in Birmingham, the United Kingdom.
According to Looi, talks between both parties are moving into the advanced stage and are currently centred on compliance with energy-efficient vehicles (EEV).
“If there are opportunities for investments which can enhance the business, we will look into it, especially EEV, to deploy our light weight alloy wheels,” he said.
Looi said the next wave of growth for MBM will happen next year as it has invested RM410 million between 2010 and 2012 to expand.
“Our investments are designed to improve our operating margin from three per cent currently, to up to six per cent in the next five years. Ideally, it should be 10 per cent, but there is pressure on cost.
“For motor trading, we expect to recoup the investments over the next three years, and for manufaturing, we are targeting eight years,” Looi said.
He said focus will also be on after-sales service as margins are in high double digits.
Looi does not think the implementation of the Goods and Services Tax next year will impact the company’s earnings. By Sharen Kaur