Ramez Hamdan, the Managing Director for Industrial Equipment (FAMCO, HINO, Toyota Material Handling), at Al-Futtaim Automotive, speaks about how e-commerce has shaped the UAE logistics and commercial vehicles industry
How has e-commerce shaped the UAE logistics and commercial vehicles industry?
E-commerce and the ensuing push toward omnichannel retailing are altering retail business models and distribution/fulfillment networks. This was and continues to be accelerated due to the COVID-19 pandemic as more consumers switched to online shopping from basic necessities to clothing and more. The commercial vehicles sector is in a unique position to adapt to and prosper from these consumer-driven trends, which has forced retailers to become more reliant on their logistics partners.
What sort of uptake did you see for HINO trucks during the pandemic? Was it very different from what you have seen in earlier years?
Despite the pandemic which affected most businesses, HINO Commercial Vehicles witnessed strong growth in 2020 with a market share of 43%. This undoubtedly has a direct relation to the increased demand across the HINO product range by customers operating in essential industries and services such as logistics, FMCG, amongst others who were operating uninterrupted even during the height of the pandemic and lockdown period.
We put a massive focus on specific sectors including FMCG, logistics, water and food distribution, e-commerce and other high-demand critical industries ensuring proper support from our sales, after-sales and parts teams. During the lockdown period, we had the highest sales for HINO trucks in a single month in the UAE.
What sort of trends do you foresee for the commercial vehicles sector and by extension the logistics sector in the UAE?
Looking ahead to 2021 and beyond it is clear that buying behavior is shifting rapidly towards online ordering of goods and services and the demand for fulfillment by the logistics and commercial vehicles sector is heightened as a second or perhaps a third leg of deliveries is added to supply goods and services door-to-door. Another growing trend is the shift towards alternative energy solutions and we expect the introduction of more electric-powered commercial vehicles which will form the backbone of some of the big logistics players in the near future.
Which factors apart from the pandemic, contributed to the increased interest in HINO trucks?
While the ongoing pandemic disrupted supply chains worldwide, in the UAE, governmental authorities have facilitated and ensured the business continuity and reach of essential industries which have enabled Al-Futtaim Commercial Vehicles to deliver uninterrupted services. We have established solid plans and solutions to meet our customers’ growing demand through sales and after-sales activities, complete with dynamic Financing Options and strong after-sales campaigns and support.
Do you have enough inventory to keep up with the demand? What have you done to streamline your business strategy to make sure you meet the regional demands during this time?
To ensure customer service continuity and delivery of the same standards of aftersales, we at Al-Futtaim Commercial Vehicles had to redeploy our associates, putting more people on our mobile service vans to ensure our customers receive our support on time. During the movement restrictions, we were able to deliver parts to our customers twice a day thereby ensuring critical logistics functions continued without any delay or disruptions, especially that the majority of our customers fall into the vital FMCG, logistics, e-commerce and water distribution industries.