since 1976
since 1976
DRB-HICOM Berhad through its wholly owned subsidiary, Edaran Otomobil Nasional Berhad (“EON”) shall expand its presence in the aftersales services market via a joint venture with the world’s fifth largest fast-fit service brand, Petromin Express, a subsidiary of Petromin Corporation (“Petromin”). EON today signed a joint-venture agreement with Saudi Arabia’s Petromin to venture into fast-fit vehicle servicing. The proposed new joint venture will be 51:49, shared between Petromin and EON.
This 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 fast fit aftersales franchise model to capture a fast and growing aftersales segment that closely aligns with the strategic objectives of both parties.
The agreement between the two companies was signed at a ceremony at Wisma DRB-HICOM today. Signing on behalf of EON was its CEO Akkbar Danial, while the signatory for Petromin was Group CEO, Kalyana Sivagnanam. The signing was witnessed by DRB-HICOM Group Managing Director, Dato’ Sri Syed Faisal Albar and the senior management team of both companies.
Syed Faisal believes the joint venture will benefit both parties.
“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.”
“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,” Syed Faisal says.
Akkbar and Kalyana both voice their hopes for the collaboration.
“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”, says Akkbar on the collaboration.
“Petromin actively seeks to collaborate with likeminded 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,” says Kalyana.
He adds that their experience in the existing markets will benefit the parties.
“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.”
Meanwhile, Petromin’s, Managing Director, India & SE Asia, Sanjay Nigam expresses enthusiasm that the collaboration comes at an opportune time with customer relationships with OEM’s 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 says.
AUTO AFTERSALES SERVICE A GROWING SEGMENT
The joint-venture company targets to commence pilot operations of the business in January 2023, with four outlets during the 18-month pilot. Modelled after Petromin’s highly successful 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 RM42b in 2021. While the services will be offered to all vehicles, the company will be targeting post-warranty vehicles aged between 5 and 10 years. The pilot will enable management to derive a longer strategic roadmap for the business including capital requirements for expansion.
ENLARGING DRB-HICOM’S AUTO FOOTPRINT WITH PETROMIN’S EXPERTISE
The collaboration complements DRB-HICOM’s existing and extensive automotive value chain. The Group is already an OEM via PROTON, retails several foreign automotive brands under the EON umbrella and 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 over 700 outlets across Saudi Arabia. The Petromin lubricant brand controls the Saudi market with 40% share, and exports to over 35 countries in the Gulf, Middle East, Africa and also Asia. Petromin also operates gas stations under the same brand and distributes Nissan cars in the kingdom.
