Motorcycle makers may build cars

THREE of the most famous names in world motorcycling could be-come automotive manufacturers.

MV Agusta, Cagiva and Husqvarna make up MV Agusta Motor SpA, which is currently under controlled administration.

But cash-rich Malaysian national car-maker Proton has made a formal binding offer on the Varese (Italy)-based company and expects a positive reply within six weeks.

Proton’s vision is that the MV Agusta name would be suitable for high-end luxury performance cars, Cagiva would suit sports models while Husqvarna would become a maker of off-roaders.

"We want to take those names across from the bike world into the car world," said Proton CEO Tengku Mahaleel this week while in Australia for a board meeting of the wholly-owned local distributor, Proton Cars Australia.

"We would consider the MV Agusta as the premium Mafioso car to compete with cars like Maserati," he said.

"If you look at Cagiva it’s also a high price but not as high as MV and more like a hatchback or something like that.

"Then look at Husqvarna, Proton would never be known as a four-wheel drive off-roader so Husqvarna is a natural choice to create an off-roader."Proton also wants to tap into MV Agusta group’s styling ability, technical expertise and well-developed distribution network.

The MV Agusta Group is solely owned by Claudio Castiglione and has been in financial difficulty for some time.

Proton signed a letter of understanding with MV Agusta last October that enabled an inspection of the company’s books and last week made the binding offer for 55 per cent of the shares.

If the bid is successful, it would mean asubstantial addition to Proton’s current new model plans, which amount to around 20 new models off four new platforms over the next few years.

That includes high-performance models to be built by UK-based subsidiary Lotus based on a new highly-adustable all-alloy architecture.

It is this architecture on which a luxury MV Agusta car would be based, probably mated to a new modular V8 engine also currently under development.

"Getting the people at MV to style an extreme car would be so interesting,"Tengku Mahaleel said.

"And there are some unique technologies they are developing which we are aware of, which are very, very interesting."But Tengku Mahaleel said the three companies would continue in the motor-cycle business as well.

MV is famed in the bike world as the company for which the great Giacomo Agostini won 13 world road-racing titles. Recently it has gained fame for its F4 roadbikes, with inline four-cylinder engines designed by Ferrari.

Husqvarna has Swedish origins and is a maker of outstanding off-road motorcycles. The brand is actually owned by Electrolux and leased to the MV Agusta Group.

But it is Cagiva that could be the cash cow for Proton because it is very well known in Asia and could become a big player in that region’s booming scooter and small motorcycle market.

"Scooters are the fastest growing segment in the east and Cagiva can easily make a scooter," Tengku Mahaleel said.

"The Cagiva brand name is very, very strong in the east and to bring production if possible to the east would give them huge volume."Proton is already involved in motorcycling through its sponsorship of American Kenny Roberts’ MotoGP team. But that arrangement is due to end this season.

Supply problem in MG Rover deal

TENGKU Mahaleel played down the prospects of a deal with MG Rover taking place.

The two companies announced they were discussing mutual product opportunities earlier this year.

He said this week that overcoming supply issues was proving difficult.

"MG Rover is not an alliance, they want to buy things from us, that is purchase and sell. There is a few severe challenges on the basis of our discussion."He also rejected any chance of discussions with GM Daewoo Auto Technology leading to a deal.

Keeping a watchful eye on Mitsubishi

THE Tengku has also played down but not ruled out becoming involved with Mitsubishi Australia’s operations, and has admitted interest in the company’s Adelaide engine foundry which will close in October next year.

Tengku Mahaleel revealed Proton’s interest in becoming a local assembler in March when the latest round of question marks over the future of Mitsubishi Motors Australia first surfaced.

"Buy the foundry? Yes we can look at it, because the engines and stuff for the future we are making for the future need aluminium, and if Australia has advantages why not?" Tengku Mahaleel said this week.

"But until that comes on to the table very openly, I would not be able to assess it."