KING OF THE ROAD

Dominican Republic 2013 | INDUSTRY & MINING | INTERVIEW

TBY talks to Enrique Dalet, Director General of EDOM, about the automotive sector and its market-segment presence.

Enrique Dalet
BIOGRAPHY
Prior to becoming Director General of EDOM, Enrique Dalet served as Director of Sales at EDOM. He attended the University of Barcelona from 1966 to 1972.

In line with the recent signs of an economic recovery in the Dominican Republic, how would you assess the current situation for the automotive industry?

In the last two or three years, we have not been as badly hit by the economic crisis as other markets have. There has been a stable market and a stable exchange rate, which can be attributed to the former government. We see stability continuing for the next two or three years. The main concern for our sector is that the general conditions for the economy of the country are set for a low to modest expansion, so we expect that growth will stall a little. In the next two years, we expect to see a low but positive growth rate in our part of the industry. We do not foresee an explosion of demand in the next few years—only minimal fluctuation. The volume of used cars and equipment has a heavy influence on our business. A surplus in used cars and equipment in the Dominican Republic depresses growth in the market for new imports. Much of the future depends on the fiscal structure of import and consumer taxes. A reorganization of these items in connection with import costs, fuel consumption, and environmental protection would be healthy and positive.

What are EDOM's brands and market position in its different divisions?

Small- and mid-sized cars have not been the preferred option for Dominicans, as SUVs have constituted almost half of the imports in the past few years. In recent times, we have seen a steady change toward smaller and more efficient units, probably due to fuel costs and traffic conditions. Fiat, which has been known for its efficient, small, and powerful engines, has the potential to substantially improve its market share. We could have a higher market share in the commercial vehicle segment including natural-gas powered commercial units and trucks. In terms of luxury brands, we offer Alfa Romeo, which produces beautiful sports cars. Its models have been performing very well since we launched the brand in early 2012. On the tractor side, we represent high-quality brands like Case New Holland, which make up approximately 30% to 35% of the market. We also represent Iveco in the truck sector, and this brand is just starting to produce light trucks, which comprise most of this market segment. In the summer of 2012, we launched the light Iveco truck line, named Leoncino. In terms of big trucks, we have about a 3% or 4% market share, mainly composed of specialty units for big industries.

Do you think you gain a competitive advantage from your affiliation with the large and consolidated Vicini Group?

Yes, there is synergy in the group that is represented in so many sectors; Vicini is in the finance, insurance, energy, metallurgy, agriculture, and retail sectors. This opens up possibilities for us to work with each of these companies to promote our products. On the supplier side, we have Fiat, which is one of the most innovative groups in the world. Fiat has the best diesel engines, which are small and high performance. This means lower consumption and reduced emissions. We have four-cylinder engines that perform comparably with American six-cylinder engines. High-quality products create a competitive advantage for all of our brands, not only Fiat but also Alfa Romeo and Iveco.

“The volume of used cars and used equipment has a heavy influence on our business."

EDOM also represents Hertz in the Dominican Republic. What is Hertz's local market position?

In car rentals, there is brand association; there are top brands, mid-level brands, and economy brands. In the top brands, Hertz is number one in the world. Customers count on good service and the availability of many vehicles. On the service side, we try to be the top, even though we do not have the largest fleet. Our competitors may have more cars, but they provide a lower level of service. We prefer to have fewer cars and a higher level of service. We keep our cars fresh and in good shape, while some competitors have been using the same cars for over three years. This separates us from the competition.