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PDF 629414 chapter 6 pages 206, 214 X PDE 629414 chapter 5.pdf X (PDE Richard A. Musgrave, Peggy Bos X + X File | C:/Users/LAKSH/Downloads/629414%20chapter%205.pdf . . . 21 of 36 + 2 A' Read aloud Draw V Erase ANALYZING MANAGERIAL DECISIONS: Developing Economies of Scale for Malaysia's Proton Holdings Proton Holdings Bhd is a national carmaker in successes. The management also implemented Malaysia. In late 2007, the Malaysian government stringent cost controls. Nonetheless, analysts con- owned 43 percent of the company. The remaining cluded that Proton's long-run ability to survive de- stock of the company traded on public stock ex- pends on whether it can achieve increased produc- changes. Proton was among Malaysia's worst per- tion volume and economies of scale. Without forming companies in 2005, after competition from sufficient scale it is unlikely that the company will foreign carmakers and a lack of new models cost survive the intense local and worldwide competi- the firm significant market share and profits. It has tion. The analysts assert that by itself, Proton since hired a new chief executive, sold its loss- would find it hard to achieve economies of scale making MV Agusta motorbike firm, and pledged to and to develop new technologies. find a new technology partner. The company has Suppose that you are hired as a consultant to been under substantial pressure, with its share of domestic sales falling from 75 percent to 44 per- advise Proton's management. What do the analysts mean when they say that Proton needs to achieve cent over the past decade. economies of scale to be competitive? Discuss at a Analysts polled in late 2007 noted that the com- general level the types of actions that the company pany's new management had made several moves might want to consider to achieve the necessary to revamp the company and that these efforts were scale. bearing fruit in terms of increased sales volume and market share. New models such as the Persona, a sport edition of Savvy, and Satria Neo were relative Source: K. Fong (2007), "No Economies of Scale for Proton with- out Global Partner," StarBiz, thestar online (November 21). Type here to search O S W 1 8 6 7 4x ENG 15:48 21-07-2020 F7