Volkswagen (VW), Europe's biggest car maker, said Friday it was in talks with state-owned Malaysian car maker Proton about the possibility of setting up a strategic partnership that could give the German company a foothold in the fast-growing car market of South East Asia. "We're negotiating about the possibility of a cooperation," a spokesman said, without specifying further. A report in the Friday edition of The Wall Street Journal said the cooperation could take a number of different forms, such as the creation of a joint venture or the acquisition of minority stake in Proton by VW. The two groups could sign a deal before the end of the year, the newspaper suggested. Proton is 38-percent state controlled and has a 50-percent share of the Malaysian car market where the state slaps heavy taxes on imported cars. (AFP)