AUTOMOTIVE JAMAICA

Jamaica 2018 | TRANSPORT | B2B

Regardless of whether they are new or used, cars are engines of growth for Jamaica's economy.

Andrew Jackson
ANDREW JACKSON
General Manager
Jetcon
Gregory Webster
GREGORY WEBSTER
Managing Director
Fidelity Motors Ltd.

How did you identify your products and target markets?

ANDREW JACKSON We started in 1991 with car care products. That did well, and in 1994, we started importing used cars from Japan. There was a change in legislation in 1994 that lowered the import tax on used cars for resale. We were among the first to tap into this market. Since then, we have found that the best combination of price, quality, and availability of right-hand-drive cars comes out of Japan. There is low-cost shipping as well. It is more economical to ship from Japan to Kingston than Miami to Kingston. It is counterintuitive; however, it is a question of volume. There are huge ships carrying 7,000-8,000 cars that stop in Jamaica every week on their way to the US. For a market like the UK, which also uses right-hand-drive cars, the cost of shipping is also expensive. The cars are more expensive as well. Some of the policies in Japan also work in our favor. The Japanese government gives car owners incentives to sell their cars after a short time. In Japan, the price of cars drops sharply after three years. This is where we tend to come in. The Jamaican market's response to Japanese cars is fantastic.

GREGORY WEBSTER We initially represented Nissan, Nissan Diesel, and Nissan Forklift. Since then, Nissan Forklift has changed to UniCarriers, though we are still its representative. We also represent Zhengzhou Nissan ZNA out of China. Our initial focus was the pick-up, which is Nissan's prime product, and have made major inroads into the bauxite-manufacturing sector and among farmers and professionals. The main focus of Jamaica's market is currently SUVs, and we mostly concentrate on those vehicles. Our business is mainly pick-ups, buses, panel vans, and SUVs such as the X-trail and Pathfinder. Though Jamaica's used car market is roughly twice the size of its new car market, we deal only in new cars. There is always a market for new cars because banks give customers preferential rates, and new car dealers offer attractive warranties.

What are your goals and objectives in the coming year?

AJ We seek to grow by about 40-50% in terms of sales and profit, and want to expand outside of Kingston. We are also looking at the possibility of exporting to other Caribbean countries. Jamaica is centrally located in the region, and there are shipping services that handle cars. Jamaica can be a hub here for the automotive sector, including cars and parts. Cars going to many different islands typically come here first. Therefore, we could provide value-added services such as servicing and repairs. We would like to maintain growth at our current rates for another two or three years. The aim is to get to about 10% market share. We expect to accomplish this by raising more capital. For a few years, we have been preparing ourselves for an IPO, ensuring our accounts were in order and the systems were in place. It makes raising capital much easier, and we do not pay income tax for five or 10 years after joining the stock exchange. This way, we can buy more cars and expand.

How do you see the market being impacted by rising demand for electric cars?

GW With the new global push for electric vehicles, we seek to get the government to lower the duties on electric vehicles, as we all want to be environmentally friendly and go green. There is a large push for everyone to go green; however, for us to feasibly do so with electric vehicles from the manufacturers' side, there has to be input from the government and infrastructure development. Jamaica Public Service Company (JPS) is also pushing for electric vehicles; however, the government needs to provide a tax incentive to encourage people to buy electric vehicles. Electric vehicles are slightly more expensive than conventional vehicles, and if they have high taxes, people will stick with conventional cars.