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Monday, October 3, 2022
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Saudi Arabia analysis: Perfect vision

JCV Juffali Commercial Vehicles' CEO Heiko Schulze on being Daimler’s power broker in Saudi Arabia and how it is empowering its own customers

Despite a challenging global landscape, Saudi’s determination to pour money into its economy and infrastructure while continuing to its programme of reform under the Saudi Vision 2030 framework makes it one of the most exciting places to be heading a major industry partner as we head further into the decade.

“I am optimistic about the upcoming years,” begins Heiko Schulze, CEO, JCV Juffali Commercial Vehicles, adding that despite the disruption caused by the Covid-19 pandemic, the Kingdom has maintained its economic development where others have faltered.

“It seems to be that also 2022 will be a good year,” Schulze adds. “With the Vision 2030, the Saudi Arabia has really chosen the right direction and the way this vision is executed is positive. Future regulations, when it comes to our industry sector, will also force our customers to renew their equipment. That is why I believe, in general, there is a positive development on the horizon, particularly for our industry sector.”

JCV Juffali Commercial Vehicles has been the powerhouse agent for Mercedes-Benz Trucks, Vans and Buses since 1976 ensuring that the German giant has maintained its preeminent status as KSA’s premier commercial vehicles brand. As the CEO, Schulze also oversees the National Automobile Industry Company joint venture with Daimler which can assemble almost 10,000 trucks per year, including the much-heralded New Actros from their Jeddah-based facility. Already the world’s most successful heavy truck it is also now one of the most advanced, enhancing the firm’s position as a major employer of young Saudi talent and ensuring that the operation continues to evolve.

Schulze, however, stresses that buyers in the Kingdom have traditionally placed value and reliability over the very latest in commercial vehicles technology.

“The technologies we are introducing are not new. When it comes to Mercedes Benz trucks, they used to be assembled in the Kingdom over 50 years ago, and Mercedes Benz is the market leader in the heavy truck sector because their trucks are reliable and offer good value for money. Of course, there are products from Daimler, like electric trucks, alternative drive trains, CO2 neutral solutions. But, overall, this is not what customers are looking for.”

As well as introducing the New Actros in 2019, the year marked the entry of Daimler’s Mitsubishi Fuso Truck & Bus Cooperation range into its ranks. Schulze believes being appointed the Japanese brand’s distributor in the Kingdom ensures JCV Juffali Commercial Vehicles can now be a full-range supplier as well as further its role in the push for local production and employment.

“The trend of localisation and the demand for it will continue. It will get stronger,” he says. “We have talked about the Vision 2030, and of course Saudi Arabia is striving to get more independent of the oil and develop different industry sectors. In this regard, localisation is essential and this is why we have decided, not only to assemble the Mercedes Benz heavy trucks here but also light and medium duty Mitsubishi models.”

He adds that the firm has decided to invest in a completely new factory in King Abdullah Economic City (KAEC). Building an assembly plant there, will place JCV Juffali Commercial Vehicles at the centre of what is planned by the Saudi government to become the automotive centre for the region and keep the operation close to the cluster of companies needed to support the burgeoning industry.

“We will assemble the Mercedes-Benz trucks line there. We will also have our neighbour the Arabian Metal Industry there for customer-specific body solutions. We will also have a third company with us which focuses on heavy construction machinery. We are approaching the future of the industry through localisation. Without localisation, it will be much more difficult in the future to do business here in KSA.”

Being successful in the market for commercial vehicles means you need to cover the entire Kingdom, he adds, explaining that the company will expand its coverage geographically while still focusing on providing greater support in its existing network: “We plan to expand to the north. We are present in all other areas already but in all relevant locations, you need to offer the service and products that are in demand. Even in existing locations, we are investing in bigger and more modern workshops. In January, we opened a new workshop facility in Riyadh. We need to satisfy our customers’ needs by being present delivering great quality services.”

While construction and investment in infrastructure are causing an increase in demand, Schulze says that new opportunities are opening up as the Saudi economy begins to diversify away from its reliance on the oil industry. This is in turn broadening the types of vehicles it needs to provide, he explains. “We are now offering a very wide range of commercial vehicle products, like light and medium duty trucks for example. We are covering the entire product portfolio with commercial vans, providing many of them to the private sector.”

The increased demand in lighter categories is being matched by a need for new vehicles to replace ageing heavy trucks in the market. Schulze suggests that, unsurprisingly, disruption in the global supply chain is lengthening order times. Frustrating both JCV Juffali Commercial Vehicles and its customers.

“We are in the commercial transportation business and sell heavy trucks. We have had a high demand for this kind of product over the past year. This is, of course, an excellent situation for us. Currently, we are not able to fully satisfy demand for this kind of products,” he explains. “The automotive industry was heavily affected; so were companies that provide heavy trucks, which is why we do not get sufficient products here in order to assemble and sell on time.”

JCV Juffali Commercial Vehicles is typically determined to keep pushing forwards, particularly as the opportunities far out-weigh the challenges in the Saudi market.

“We want to focus on growth over the next 12 months. I believe we need to grow in all the sectors of our industry through the use of different approaches. We need to prepare ourselves to participate in the economic growth of the Kingdom and to be strident in being relatively better than our competitors,” he says. “We also need to have better solutions for customers than others do. This is what is on the agenda for the next 12 months. This is something we do permanently. We permanently question ourselves; whether we are on the right track, what needs to be enhanced, what needs to be changed, what needs to be reduced, or what needs to be strengthened. This is an ongoing process.”

Central to this approach will be JCV Juffali Commercial Vehicles matching the rampant appetite for online access to services and products in what is one of the youngest populations in the region. Schulze and the company firmly believe in developing more online-based services to empower their customers.

“We are making great progress in terms of building our brand through our websites, portals, an e-commerce platform for selling parts, channels to contact customers, and we are considering the creation of mobile workshops. We are trying to cover all the regions at the same time. We are doing great deal of enhancements to these areas. We also believe in female empowerment. We have significantly increased the number of females working in our company in the last year, and we want to continue this path. We should empower and inspire the market to recognise the brilliance of women across all sectors and position levels.”

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Stephen Whitehttps://truckandfleetme.com/
Stephen White was formerly editor of Big Project ME.
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