Tim Albertsen, CEO ALD: “Quickly cover the most important markets of South East Asia”
ALD has a good track record of expanding its business to emerging markets. The company was one of the first to enter the Eastern European markets a decade ago and has been successful rolling out operational leasing in Latin America since more than five years. It’s therefore not a surprise for ALD to start operations in one of the fastest growing regions of the world: South-East Asia.
To do so, the car leasing and business mobility company is creating a joint venture company with Mitsubishi UFJ Lease & Finance Company (MUL) in Malaysia, and the hope is to have the first people on the ground by the end of April and have the company up and running by the end of June, depending on the evolution of the coronavirus.
We had the opportunity to have a chat – virtually of course – with ALD’s newly appointed CEO Tim Albertsen.
How important is Asia for a European lease provider?
“Each time we’ve invested in new regions, it was because our clients asked us to. This time is no different. Many of our key corporate clients have operations in South-East Asia and expect growth. As a service organization, we follow our clients and provide them the support they need to realize that growth.”
“Nevertheless, we do recognize that Asia will be a bit different from our previous ventures, which is why we’ve decided from day one to work with a suitable partner that has a solid foot on the ground in the region – and MUL (editor note: Mitsubishi UFJ Lease & Finance Company) is the right partner. Joining both client portfolios is the key to success.”
Will we see ALD offering operating lease or other (mobility) products?
“We’ll be doing what we do best. This means that we are focusing on full service operating lease in combination with a fleet management service offering for those clients that are transiting from self-managed fleets to operating lease. In terms of mobility, we are obviously keeping our eyes open: South-East Asia has a few very strong mobility provides, such as Grab and Go-Jek. ALD might enter the mobility market with our carsharing platform, but we could just as well become the asset supplier for existing transport service providers. I do think however that we need to stay close to our core competence, which are car-centric solutions.”
Malaysia is ALD’s starting point in Asia. Why is this the case and will ALD expand to other South East Asian markets?
“The reason to start in Malaysia was made based on an overall regional consideration and in coordination with our partner. MUL already has a strong presence in the country and we want to be the first international player in this market where local competition isn’t particular present either. We’re fully aware that other major players in the leasing industry have tried building up a business in Malaysia before, but, as we’ve learned from our previous experience in emerging markets, timing is key: the market is ready, our customers are ready and, thanks to our partnership with MUL, we are ready.”
“Of course, we’re already looking beyond Malaysia. We have a plan to relatively quickly cover the most important markets of South East Asia. We do believe we could have three countries covered by the end of 2021. The Thai and the Indonesian markets combine potential with maturity. Singapore, Vietnam and the Philippines are interesting markets. So, don’t be surprised to see us move into these markets as well within the next few years.”
This was probably not a decision that was made overnight.
“Not really. We’ve been working for several years with our Japanese counterparts before getting to this point. In the process, we have been able to demonstrate our operational excellence and build a relationship of trust with MUL. Also from our side, any potential partner has to tick a lot of boxes, so we’re pleased to have invested enough time in due diligence and governance of the joint venture.”
Was the decision to sell off ALD’s Chinese operations in any way related to the joint venture?
“Not at all. Selling our part of the Chinese joint venture was purely a business decision and it was the right one at the right time. China is not a company car market and we don’t think it will become one. Looking at the Chinese market today, I’m even more convinced that we made the right decision.”
We have to ask… How is the coronavirus impacting ALD?
“We don’t have all the metrics yet. Twenty of our ALD countries are hit by the impact of the coronavirus, which means that in several countries, no new cars are delivered and obviously, old cars are not returned. Nevertheless, we have learned from previous crises and apply these learnings now.”
Tim concludes: “As a result, the ALD model is a very resilient one and we’re sure that we’ll come out even stronger. The good ones are even better when the situation is difficult!”
ALD is one of the founding partners of the first Global Fleet Summit APAC, that will be organised on 8 and 9 December in Singapore. To know more about the porgramme highlights and registration details of this new conference for international and regional fleet professionals with responsibility over APAC, please visit the event website.