Troubled national carmaker Proton Holdings posted a quarterly loss of RM250.34 million today as its sales continued to decline.

The red ink for the three months to September came after a RM154.33 million loss in the same period last year, the company said in a statement.

Turnover slumped to RM1.27 billion from RM1.8 billion in the same quarter a year ago.

Proton blamed the poor results on a tough automotive environment with declining car sales, as well as tighter credit screening and loan approvals from banks that hampered demand for new cars.

"The losses are a result of a depressed and competitive market environment, while efforts to reduce operating expenditure have yet to be fully realized and dampened by a lower production volume," said managing director Syed Zainal Abidin Syed Mohamed Tahir.

He said the intense competition and lower sales had resulted in higher inventory, which required additional expenditure on promotions.

Turnaround plan

Syed Zainal said he expected Proton to perform better in the near to medium term under a turnaround plan which includes an alliance with a foreign partner by early next year, new models, new platforms and new markets.

"The company has kicked off various strategies and initiatives to strengthen and improve its operation. Hence, going forward we are confident that there will be a positive change," he said.

"We have to change if we are to emerge stronger from our current situation. To do so, we have to transform our organisation into one which is more efficient, responsive and cost effective."

Proton's sales up to October 2006 stood at 100,515 units compared to 139,689 units for the same period last year.

Car sales in Malaysia, including passenger car and commercial vehicles, fell by 10 percent from January to October compared to the same period a year ago.

Proton's market share has fallen steadily in recent years due to the whittling away of import duties and a persistent reputation for poor quality and unimaginative models.