1. ALD Automotive has 10 years on the local market. What did they mean for the company and the operational leasing market?
Indeed, it is a very special year for us. 10 years ago, ALD Automotive was one of the first international operational leasing companies on the Romanian market. Now we are amongst the leaders of the field and our results prove that we have a major role in the development of the field. We invest in the quality of our services and we have earned the trust of our customers, as a partner they can rely on. Thus, a very big part of our clients have been with ALD Automotive since 2005, which only comes to reconfirm the quality of our services and our ability to always reinvent ourselves.
During these past 10 years we have influenced the market with our innovations, such as the eco initiatives, mobile applications, online reporting tools, customer care services and exclusive partnerships. In 2005 we started with a team of 12 people and ended the year with a fleet of 170 cars. Since then, we have continued to grow and, entering into 2015, we had a market share of 17%, 8,386 vehicles in our fleet, almost 270 clients and 63 employees. These are important results which once again proved the success of our client centred business model, based on innovation and quality. At the end of 2015, we hope to see further growth, reaching over 9,000 vehicles in our portfolio and over 300 clients.
We have constantly reinvented ourselves and developed at the same pace as the market. In the meantime, new competitors came along and this determined a growth in the quality of services, for the benefit of our clients. This competition is favourable to a healthy development of the market and makes us more attentive, more dedicated and always a step forward. We want every manager to have the ideal solution for his company and this will always be a personalised solution, adapted to the particular needs of every field.
From an international perspective, Romania still has a long way to go in order to reach the European performances. Nevertheless, it is a service that grows every day and a financing method that constantly grew in the past 10 years, no matter of the economic crisis. This shows us that a big part of the companies in Romania begin to better understand the advantages of such a service, which insures an efficient business through adaptability, mobility and cost predictability.
2. How much has ALD Automotive developed this year? How was the evolution of the operational leasing market?
The operational leasing market has registered very good results in the past 10 years, with constant positive evolution. The most recent reports show a good 16% growth in the first semester of 2015, compared to the same period in 2014, a phenomenon based on a general economic growth and development of the auto market. This climate has led to a more secure business environment and gave clients and investors more confidence which I am sure we will lead to positive results at the end of 2015.
At the same time, ALD Automotive has continued its constant development and this year we have had a 12.1% growth in the first 6 months compared to the same period last year. We remain optimistic about our end of 2015 results and, continuing this growth path, we should see an end of year fleet in excess of 9,000 vehicles.
ALD Automotive keeps developing thanks to its solid portfolio of multinational companies and also to our new focus in 2015: SMEs. For these type of companies, we have created special operational leasing programs and our sales consultants give them personalised advice according to their line of work. During 2015, we have also created the first white label operational leasing product, in collaboration with Toyota Romania. Leveraging on the international partnership, we decided to expand this operational leasing solution to Romania and we are convinced it will have a very positive influence on the local operational leasing market and, in particular, the SME segment.
3. Do local and international companies know the advantages of operational leasing? What are the benefits that can turn into investment decisions? What advantages are less known at the moment?
Operational leasing is a well-known service at an international level, so 10 years ago, when the market started to grow in Romania, managers of multinational companies already knew the benefits and thought this as the most efficient solution for their fleets. Consequently, our first clients were major companies with offices in Romania. With big fleets, they appreciate mobility, our consultancy services, the 24/7 assistance, our reporting tools that help them oversee costs and a full outsourcing of a non-core business activity. They also appreciate our international know-how and the standards of our business model.
When it comes to SMEs, we are still in the early stages, when they start to know the service and its advantages. A key finding of a study done by ALD Automotive and Nielsen last year was the desire of the operational leasing clients for full mobility and cost reduction solutions. They also choose operational leasing for the costs predictability and opportunity to operate with a fixed monthly rate. These are important advantages that help us convince our clients to choose operational leasing no matter the size of their business.
The lesser known advantages of operating leases are perhaps the fiscal ones. As ALD Automotive is the owner of the vehicles, these are recorded as assets in ALD’s accountancy, while the customers only need to record operating lease expenses rentals for these vehicles. As a consequence, the total assets value in customer`s accountancy is diminished by the value of the vehicles, thus the profitability ratio of Return on capital employed increases.