Reaffirming its status as both a high-profile showcasing event and a bona fide platform for business, Automechanika Dubai 2014 was fraught with action. James Morgan brings you some of the main highlights from the show.
Last month, Dubai World Trade Centre opened its doors for Automechanika Dubai 2014. Expectations before the show were running high, with more than 1,650 companies due to exhibit and upwards of 25,000 visitors expected to attend during the course of the three-day event.
Speaking to PMV prior to the show, organisers EPOC Messe Frankfurt said that the Dubai iteration of Automechanika is second only to its German namesake in terms of the diversity of nationalities populating the exhibition halls.
“We get visitors from across the world,” said Mahmut Gazi Bilikozen, senior show manager.
“Two years ago, I met a gentleman from Hertz Chile, for example, and I asked him why he had travelled all the way to Dubai, other than for a vacation at a nice destination. He told me that at our show, he is able to gain access to manufacturers that he cannot meet in other countries,” Bilikozen added.
The 12th edition of Automechanika Dubai certainly didn’t disappoint in terms of global representation. With countless auto parts manufacturers and suppliers hailing from as far afield as India and China, this year’s event had a distinctly international flavour.
“Obviously, there are large, well-known manufacturers that are present in every territory,” commented Bilikozen.
“However, smaller manufacturers from places such as India, Turkey, Jordan, etc. are not present in every market. What’s more, the quality and price of their products are usually very good.
“We will have over 200 domestic exhibitors, but around 90% of all the exhibitors will be international. Last year, we had 24,141 trade visitors from 130 countries, so I’m confident that we’ll pass the 25,000 mark this year. It’s always difficult to predict in advance, but there’s usually a positive correlation between the number of exhibitors and the number of visitors,” he explained.
The show’s expansion is in keeping with the GCC’s current market for auto parts, batteries, and tyres, which is expected to grow at 14.9% over the next three years, reaching $13.46bn by 2017. Indeed, despite the global makeup of exhibitors, there was no getting away from the fact that this was a GCC show.
One of the highlights of the event was the deal finalised between multinational parts distributor Intertruck and UAE-headquartered Al Jaber Leasing Services. With Automechanika Dubai 2014 as a backdrop, Intertruck MENA revealed that Al Jaber was to become the first outfit in the Middle East to take advantage of its Vendor Managed Inventory (VMI) package.
“VMI is a concept that Intertruck has set up with a large customer in Abu Dhabi, Al Jaber,” explained Marcel van Eeuwen, CEO of Intertruck Group.
“We look at the fleet of the customer. What units do you have? How many do you have? What do you need? What is your use of spare parts? Once we’ve mapped this information, we take over their spare parts business. That is what VMI involves; we go into the warehouse, we take over their operations, and we make sure that everything they need is there,” he said.
Intertruck will implement VMI at Al Jaber Leasing Services’ main warehouse in Mussafah, UAE. Parts, argued van Eewen, represent the core of his company’s expertise. In turn, VMI is a service aimed at businesses for which this is not a primary focus.
“It’s our core business and our competence, whereas most of the time for fleet owners, it’s not their core business; it’s their core business to use the fleet,” he commented.
The Al Jaber agreement was not the only one to be announced by Intertruck during the event. The company also revealed that it is to become the official distributor for parts manufacturers Eaton, Wabco, and Mahle across the Middle East and Sub-Saharan Africa.
“The [parts] supply chain spans from the manufacturer all the way to the end user who puts it on the vehicle; you cannot do that by yourself,” said van Eeuwen.
The cooperation agreements were signed in front of the cameras at a ceremony in Automechanika Dubai’s VIP lounge. The Intertruck boss was joined by Eric Zahrai of Eaton and Ziad Jadaa of Wabco.
Speaking of the regional distribution deal, Jadaa commented: “As manufacturers, we always need big, strong partners to cover the market in terms of customers and end users. Intertruck has been working with Wabco for many years in Europe, but I would like to welcome them to Dubai and to the Middle East.”
According to Zahrai, the ability to cater to customers of Al Jaber’s stature is one of the factors considered by manufacturers when partnering with prospective distributors.
“From Eaton’s perspective, we firmly believe that availability of parts is fundamental,” he told PMV.
“Wherever you go, customers are looking for service, support, and availability, and I think that with the Intertruck footprint in the UAE, we’ve got a very good opportunity to supply the parts at the right time, when the customer needs them. I think that will help us a lot,” Zahrai added.
In addition to proving itself as a bone fide platform for business, this year’s edition of Automechanika Dubai reaffirmed its status as a channel for those wishing to enter the region’s auto parts market. Affiliate companies OWS Auto Parts and TransAxle Middle East, for example, are looking to popularise the process of remanufacturing in the GCC.
The firms, which both have roots in the United States, have been working hard to increase market awareness of remanufactured auto parts. Todd Pelkey, operations manager at TransAxle Middle East, provided further details of the practice to PMV.
“We take an original product that’s been used, and remanufacture it back to its original blueprint,” he explained.
“It’s not on a repair basis; there’s a very big distinction between repaired units and remanufactured units. Our units are broken down to base components, cleaned, and they go through a technical analysis. Any worn parts are replaced, and obviously, anything that’s damaged is replaced with originally engineered products.
“We then reassemble and dynamometer test 100% of our products as well, so what we provide to our customer is – in the end – a genuine quality product with cost savings of around 40%,” added Pelkey.
The benefits that result from remanufactured parts are fairly straightforward. Essentially, the process is both financially and environmentally advantageous. Moreover, the parts offered by OWS and TransAxle span the full spectrum of the industry.
“We offer full parts across the board,” explained Pelkey. “We provide everything from brakes and steering components all the way up to drivetrain components such as axles, transmissions, and differentials. We also support heavy-duty equipment and off-highway products. We service the oil and gas industry, the off-highway industry, on-highway trucking; if it moves, we do it.”
Whilst remanufacturing represents a relatively unexplored concept in the Middle East, it is a well-established practice in the North American market. Another company looking to introduce a novel concept to the region – in the form of its ‘Pit Stop Line’ tyres – is Trelleborg Wheel Systems.
By incorporating a brightly coloured strip designed to become visible at a certain stage of wear,
Trelleborg claims that this product will help to improve safety and efficiency for forklift fleet owners.
In an interview with PMV, Alessio Loreto, product manager at Trelleborg Wheel Systems, said: “For forklift applications, we have introduced Pit Stop Line: an orange strip of rubber built inside the tyre that appears when just 100 hours of tyre life are left. This is very practical because you can plan tyre replacements.
“You have a sign of when the tyre is finished, and actually, Trelleborg is the only company in the world to include this kind of feature inside its industrial tyres,” he added.
For now, Pit Stop Line is to be introduced only for the forklift sector. However, Loreto revealed that Trelleborg’s ultimate goal is to roll out the technology across its entire range of industrial tyres.
“I would say that by the end of the year, we will have integrated it into our two main industrial tyre lines – Trelleborg Elite XP and Trelleborg M2 – and then, within the next two to three years, it will be rolled out across our entire product range,” he concluded.
Another firm on the lookout for business opportunities at Automechanika Dubai 2014 was car-care specialist 3M. The company decided to use the event as a shop window to showcase products that boast specific advantages for the UAE’s largest fleet operators.
“One of the specialist products that we are introducing to the region at this show is called 3M Crystalline,” explained Tarik Abd-Rabu, senior marketing specialist at 3M Gulf’s Car Care Market Centre.
“This is a transparent window film, the idea being that it reflects as much heat as possible during the summertime. It also reflects 99.9% of the ultraviolet rays and 95% of the infrared rays, which are harmful to passengers. At present, this product is intended for the commercial vehicles sector.
“Once a company has permission from the RTA to apply this product to its fleet, we will install the transparent window film on its vehicles. 3M Crystalline reflects between 60% and 70% of the heat, which means that drivers use their air conditioning systems less. In turn, this reduces gas consumption, which is both financially and environmentally beneficial,” he told PMV.
Abd-Rabu and his colleagues are confident that 3M Crystalline can offer significant economies of scale to large fleet operators. As such, the firm is looking to engage the UAE’s biggest players, including taxi companies.
“The product is still new to the market,” said Abd-Rabu. “We’ll have to approach the RTA and we’ll have to approach the fleet companies. They have to get special approval, and then we can take it from there.”
In addition to Crystalline window film, 3M showcased other fleet-focused products such as its Scotchgard vehicle protection film and its headlight lens restoration package. This suite of options provides additional advantages when applied on a large scale, according to Abd-Rabu.
“Scotchgard vehicle protection can maintain the colour of the car, the paint of the car, and the shine of the car for approximately two years,” he said.
“Commercial vehicles are overused in comparison to privately-owned vehicles because they are constantly being driven. This means that value depreciation occurs at a faster rate, and the residual value of the vehicle is reduced. With this in mind, we also offer an internal protection package to preserve upholstery,” he added.
Of course, in order to cater to customers operating on this scale, 3M will need to demonstrate more than the worthiness of its offerings. The company must also convince potential buyers that it is equipped to install its products across large numbers of vehicles.
Fortunately, Abd-Rabu says that in conjunction with its exclusive UAE distributor, Auto Millennium Group, and its network of authorised garages, 3M is ready to meet this level of demand. Moreover, he seemed particularly optimistic about the contacts being made at the Dubai trade show.
“In terms of growth, the Middle East is the biggest region for the automotive industry at the moment,” he said.
“Automechanika provides us with a great platform to meet with all of the different business sectors and potential customers through our distributors. We’ve got a lot of interest, a lot of people coming to the stand and asking questions; the curiosity is there and this is a good sign,” Abd-Rabu added.
The aforementioned companies represent a drop in the ocean compared to the total number present at Automechanika Dubai 2014. However, they also offer an ideal microcosm of the show.
Some firms, such as Intertruck, used the event to cement deals. Others, such as OWS and TransAxle, strove to introduce unexplored concepts to the market. Manufacturers such as Trelleborg chose the show as a launch platform. Companies such as 3M, meanwhile, looked to exploit the networking opportunities offered by Automechanika.
Despite the differing reasons for attendance, one thing was absolutely clear. The Middle East’s automotive market is abuzz with optimism, both in terms of established players and newcomers to the region.
