Denis Gorteman, CEO D’Ieteren Auto: “We aim to be the benchmark for mutimodality in Belgium”
D'Ieteren is not only an institution in the Belgian automotive sector, it is also a benchmark in Europe. It is the long-time importer and exclusive dealer of Volkswagen and eight other brands, controlling almost 23% of the local market. Through Belron, the D'Ieteren Group is also the world leader in automotive glass repair, replacement and recalibration, with a presence in 39 countries. Denis Gorteman, CEO of D'Ieteren (the Automotive division), sets out the challenges of a diversified future.
Henceforth, D'Ieteren is an investment company, defining its mission as a "builder" of "a family of companies that are reinventing their industry, aiming for excellence and a significant impact." It is built around four axes: corporate professional services, industry, mobility (services and data) and lifestyle (goods and services). With a market capitalisation of over €3.5 billion and around €1.5 billion in the coffers, the group has the means to materialise its ambitions.
For the third year in a row, the automotive distribution analysts at ICDP ranked D'Ieteren eighth in its top 50 automotive distribution group with 23 trade names, 9 brands, more than 129,000 new cars and nearly 1,800 used vehicles sold in 2019. But the group is diversifying more and more.
For D’Ieteren, international growth comes first and foremost from Belron, with Carglass as its best-known brand in Europe, which is 54.85% owned by D'Ieteren. It is a highly profitable division, without going into too much detail about Moleskine, “the” prestigious notebook…
Fleet Europe: As the holding company is diversifying, what is the place of purely automotive activities within D’Ieteren Group?
Denis Gorteman: It remains very central to the reference shareholder, the D'Ieteren family. The auto activity, despite the passing of the patriarch (Editor's note: Roland D'Ieteren ran the 200-year-old company for several decades and died last December. His son Nicolas took over as president) is and remains in the blood of the present generation.
But beyond the emotional aspect, isn't the “weight” of the car going down naturally?
If we are only talking about the import and retail activity, yes, by definition. Especially since we do not have ambitions for international growth for these activities. Nor do we want to increase the number of brands we import.
Mind you, we include a larger set of services to the motorist, which include Belron. Globally, the car fleet is growing and so are Belron's activities. The automotive industry will not be a retreating. In any case, D'Ieteren Group doens’t exclude any investment opportunities and we are definitely looking at car services and obviously mobility!
What strategy does your new corporate identity, “Moving people forward,” correspond to?
The D'Ieteren brand is at the heart of everything. People in Belgium see us as a car company rather than a holding company. But at the same time, if the car is going to remain central in the mobility of tomorrow, a new model must be developed.
Before the COVID crisis, 84% of all kilometres were travelled by car but by 2025, that will be 70% against 15% via public transport and 15% using other solutions. For the moment, we are carrying out a major survey among customers and prospects to better understand customer expectations, both for individuals and for fleets. There is no turnkey mobility solution, it needs to be built for each market segment.
You can expect new concrete mobility solutions from us by the end of the year. Our long-term objective is clear: D'Ieteren wants to ensure that when people are on the road in Belgium, they are using a D’Ieteren service in one way or another.
How will leasing fit into this evolution?
Technology makes it possible for average contract durations to go up as more electric vehicles enter the fleet market. Think of 6- or 7-year contracts with the option to change vehicles 2 or 3 times. We will offer formulas where vehicles can easily be switched within the same fleet or the same community.
Private lease will also grow, because EVs are more expensive and to cover the technological risk. These days, no one can still guarantee the value of a car you buy today. Always get a vehicle with a trade-in contract.
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D'Ieteren Volkswagen dealership, Brussels (copyright: D'Ieteren)
Everyone is talking about mobility but it’s hard to make that concrete but D'Ieteren has the means to get there. Are you investing in all kinds of start-ups with a trial and error approach?
When we set up Lab Box four years ago, we had certain views on consumer behaviour but things have changed. We need to take into account the changes in consumer behaviour after the health crisis and translate them into effective solutions.
Take the mobility budget. We thought it would take off in Belgium, but it never did. We have a subsidiary working on this topic and we believe it can be a great success if there is political will to make it happen.
We have set up a platform that aggregates all the objective data of a corporate mobility budget, including all the the costs detailed in the legislation. The mobility budget is the future, and we are ready. And we're the only ones on the market.
Does fiscal instability in Belgium dishearten you?
Not only is our tax system unstable, it also varies from one region to the next. It is not coherent, it has neither vision nor clearly identifiable objectives.
However, the car in Belgium represents 22 billions in revenue so it makes sense to know where you want to go in terms of taxation. It is necessary to support investments in technologies and to promote multimodality. The Belgian tax tool allows this if it is used intelligently, if the federal government and the regions can agree.
But I'm not very confident… When I hear what is being proposed today for the €5.5 billion European recovery plan... There’s no vision, there’s no focus.
It’s the same problem with electric car legislation.
We are talking about a 100% electrification objective for fleets. But it’s only an intention. It should become a decision. Right now! This would give a clear sign to investors and the market that could adapt without delay.
In his words...
On plug-in hybrids
"It’s the best compromise today, if used correctly. In 3 or 4 years, the electric car will have advanced enough to make a 700- or 800-kilometre range feasible."
On the Belgian market
"New vehicle sales should stabilise to around 450,000 units in the next 4 to 5 years. We were at 550,000 at the end of 2019… This remains a very high per capita ratio compared to countries like the Netherlands."
On online sales
"Everyone is investing heavily in online sales but over 95% of the people want to go to a dealership!"
Image: Denis Gorteman, CEO, D'Ieteren Auto
Interview: Steven Schoefs and Thierry Degives