Sime Darby Motors now in talks with potential new partners

By ahmadzulizwan, 08 July 2019

Sime Darby Motors is in negotiations with new business partners to set up regional assembly operations within their current manufacturing facility in Kulim, Kedah. This was revealed by Sime Darby Motors’ managing director Dennis Ho to New Straits Times, after a visit to the plant late last week.

The report indicates that Sime Darby Motors are talking to more than two parties and hope to come to an agreement by year-end. According to Dennis, securing any of the investors and having them as business partners would be a ‘game changer’ for the group. However, the company will have to compete with other countries in the region which offer various incentives to companies which bring in investments.

The 200-acre assembling facility is owned by Inokom Corp. Sdn., a subsidiary of Sime Darby Motors with the latter’s 51 per cent stake. Other stakeholders include Bermaz Auto with 29 per cent, Hyundai Motor (15 per cent), and Hyundai-Sime Darby (5 per cent).

The Inokom factory assembles BMW, MINI, Hyundai, and Mazda vehicles with 35 per cent of output meant for export. This facility is also the largest source of PHEV vehicles in Malaysia, thanks to BMW, of course. And it is this current arrangement with the German marque (Sime Darby Motors also assemble 3- and 4-cyl BMW engines at a separate factory in Kulim) which Dennis hopes to leverage on to secure the new business partners.

Over the next three years Sime Darby Motors want to expand the factory’s area by another 50 acres to accommodate the new partners. The current production capacity of 40,000 units will also be pushed to 50,000 in the same amount of time.