AS expected, struggling national car maker Proton yesterday reported a massive net loss of RM591.4 million (S$266.1 million) in its fiscal year ended March31.

Proton had kept the market waiting, reporting its full-year earnings only on the last day permissible. But there was no pleasant surprise.

The figures only underscore its dire straits and are sure to add to mounting pressure on the government to find a suitable partner.

Unable to seal a deal with a foreign carmaker after more than a year of talks, Proton has fallen off the radar of most investors as sales continue to slip.

Its revenue in the latest year fell crashed almost 38 per cent to RM4.92billion, for a loss per share of 107.7 sen. In the year it registered a profit of RM46.7 million on revenue of RM7.8 billion.

Proton managed to crimp losses in the fourth quarter to RM913,000, from aloss of RM272 million in the third quarter.

But that will give little comfort to those who rely on its financial health and are worried about its fast-disappearing cash reserves, which shrank to about RM460 million in the latest year, from RM693 million a year earlier.

Proton said a sluggish secondary market owing to the low trade-in value of second-hand cars, stringent vetting of hire-purchase loans and increasing competition from other marques had affected its sales and market share. From about 40 per cent in 2005, that share has dropped to less than a third now.

Fierce competition from foreign makes is likely the biggest factor. But Proton's lack of new models and quality has not helped. Its marketing strategies have also come under fire.

Slashing the price of its Iswara 1.3 model by some RM8,000 resulted in a flood of buyers, but affected sales of its lower-priced model. Buyers have also complained of a 4-5 month wait as the company struggles to meet demand for the Iswara.

Proton will launch a new model soon, but analysts and its suppliers believe the answer lies in a foreign partner that can help it develop better cars and ensure economies of scale.

Whether on-off-on talks with Volkswagen or General Motors will lead anywhere remains unclear.

As a motor analyst said recently in a note to clients: 'We have lost confidence in the entire plot.'

Proton, owned 43 per cent by state investment agency Khazanah Nasional, is one of the biggest challenges the government faces in its bid to reform government-linked corporations and enhance returns.

Proton has made no progress since the reform programme was launched in 2004.

Last year, it said its key performance goals were to grow revenue 12 percent and market share to 46 per cent. None of its objectives were met.