DRB-HICOM to expand aftersales service with Petromin JV
Malaysia’s DRB-HICOM Berhad, through its wholly owned subsidiary, Edaran Otomobil Nasional Berhad (EON), it expanding its aftersales presence via a joint venture with the world’s fifth largest fast-fit service brand, Petromin Express, a subsidiary of Saudi Arabia’s Petromin Corporation. The proposed new joint venture will be 51-49, shared between EON and Petromin.
The joint venture aims to bring together DRB-HICOM and EON’s industry capabilities and presence in the automotive value chain with Petromin’s operational expertise and track record in the fast-fit aftersales franchise model to capture a fast and growing aftersales segment.
“Petromin’s collaboration with DRB-HICOM will allow it enter into the lucrative Malaysian aftersales servicing market by partnering with a well-established and trusted corporate brand in the automotive sector,” said DRB-HICOM Group Managing Director Dato’ Sri Syed Faisal Albar.
“Their vast know-how and experience coupled with DRB-HICOM’s market intelligence and extensive customer reach will create an ideal synergy that will propel this partnership to great heights. At the same time, we are very excited to be offering a new, affordable and convenient service to Malaysians,” he said.
“We are indeed excited to partner with Petromin and expand our presence in the post warranty aftersales market, which will most definitely complement our existing OEM based aftersales businesses,” said EON CEO Akkbar Danial.
“Petromin actively seeks to collaborate with like minded industry leaders around the globe and approaches its partnership with DRB-HICOM as a pivot to bringing expertise, networks, products and services to local markets. The possibilities are, therefore, endless,” said Petromin Group CEO, Kalyana Sivagnanam..
“After decades of transforming the mobility solutions landscape in the Middle East and North Africa (MENA) region, Petromin is looking forward to helping to transforming, pioneering aftersales service experience for the discerning customers in Malaysia and around the globe. We are optimistic that this relationship will yield significant impact on the market in the face of game-changing technological, economic, and societal trends.”
Petromin’s Managing Director for India and Southeast Asia Sanjay Nigam said the collaboration comes at an opportune time with customer relationships with OEMs changing the dynamics of today’s automotive market.
“Reinventing customer touchpoints is therefore necessary as they continue to evolve and change. As market leaders in the Kingdom of Saudi Arabia, Petromin brings to bear its vast customer centric, end-to-end mobility solutions, into the competitive Malaysian market. Our partnership with DRB-HICOM will help both parties develop strategies to enhance customer experience,” Sanjay said.
Automotive aftersales service a growing segment
The joint-venture company plans to start pilot operations in January 2023, with four outlets during the 18-month pilot period. Modelled after Petromin Express outlets in Saudi Arabia, the joint venture company aims to offer vehicle owners a unique experience of fast-fit aftersales services with a quick turnaround time.
This joint venture aims to capture part of the large and growing automotive aftersales market in Malaysia, which in 2021 generated revenue of approximately MYR42 billion (USD9.3 billion) in 2021. While the services will be offered to all vehicles, the company will target post-warranty vehicles between five and 10 years old. The pilot will enable the JV’s management to come up with a long-term strategic roadmap for the business, including future capital requirements.
Expanding DRB-HICOM’s automotive footprint in Malaysia
The collaboration with Petromin complements DRB-HICOM’s existing and extensive automotive value chain. The group is already an OEM via PROTON, Malaysia’s homegrown automotive manufacturer, and retails several foreign automotive brands under the EON umbrella. It also offers mandatory inspection services via PUSPAKOM.
The partnership with Petromin provides an excellent opportunity for DRB-HICOM to tap into Petromin’s wealth of experience and know-how. It operates the world’s fifth largest aftersales network with more than 700 outlets across Saudi Arabia. The Petromin lubricant brand controls the Saudi market with a 40% market share, and exports to more than 35 countries in the Gulf, Middle East, Africa and also Asia. Petromin also operates fuel stations under the same brand and distributes Nissan cars in Saudi Arabia.