An interview with 'Global Fleet' in early 2018

An interview with 'Global Fleet' in early 2018

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Today we’re talking to Mr. Animesh Kumar. He’s the Associate Director for Automotive Consulting at Frost & Sullivan. We’re catching Animesh during his travels through South-East Asia, where he’s been visiting OEM’s and mobility suppliers in Malaysia and Thailand. Nevertheless, he has kindly made some time for GlobalFleet to answer questions about the automotive industry, mobility and the future of fleet management.

GF: The south-east Asian markets are all benefiting from a decent GDP growth, show increasing consumer confidence & are selling more and more cars. Although the number of cars per capita is still relatively low, we do see that most of the Asian capitals are heavily congested. More cars will mean more congestion. Do you think there’s a limit to the number of additional cars that can be sold in the south-east Asian market?

AK: In my opinion, though some countries have a high motorization rate - for example Malaysia - the cars per capita is not evenly divided among cities and regions. There are more cars in the bigger cities but there is still a large potential in smaller cities and towns. The larger cities, though are getting congested, do not have robust public transport infrastructure and hence there is a heavy dependence on personal cars.

Analysts have been talking about market saturation point but such analysis remains limited to certain cities and are not for any particular country or for the entire ASEAN region. The reason being, there is still a high potential in ASEAN but for tapping those opportunities, more markets have to open up and affordability in smaller markets will increase.

GF: Frost & Sullivan is rather uniquely positioned in its research on the South-East Asian automotive market. What type of customers are interested in the data & what do they do with it?

AK: Yes, you are right. We have a strong positioning across the world but are uniquely placed in the ASEAN region. Our research is highly rated amongst the stakeholders, which include automakers, policy makers, auto component companies, auto-finance and motor insurance companies, e-hailing companies, leasing companies, land transport authorities and so on.

Since we cover a broad range of topics like market specifics, policies and regulations, new technologies, best practices, mobility solutions, future outlook etc, there is something for every segment of clients. Our research, insights and recommendations are used for formulating short/medium/long term strategies.

GF: Why is your research important for the Asian Fleet Manager?

AK: Broadly, in our research, we talk about the future of mobility. We discuss that cars would cease to be products and would become a service and when that happens, EVERYONE will have to adapt. This will impact customer decision making, plans of the OEMs, usage of vehicles, vehicle segments and so on. A Fleet Manager needs to be on top of such trends.

At present, we are working on a research which talks about the impact of the growth of e-hailing as well as improvement of public transport infrastructure on OEM’s. Once such trends start to impact OEM’s, it would also have an impact on the decisions-making of Fleet Managers. We also track regulations like CO2 emissions, end of life vehicle policies, taxes and each regulation impacts the customers. Fleet Managers - in order to device better strategies - need to be on top of such insights.

GF: In your opinion, is there a real mobility offering in South-East Asia or is it just Grab and Uber?

AK: I would like to start by saying that e-hailing is just one component of smart mobility. For countries to have truly smart mobility solutions, they need to go beyond personal cars, taxis and e-hailing. For best results, e-hailing should be the option only for the first and last mile connectivity. Customers should be able to use multi-modal transportation in order to reach their destination in a fast and inexpensive manner. And it should be better for the environment and also solve problems that most large cities across the world are encountering - congestion and parking.

As far as e-hailing is concerned, Grab is certainly the market leader across the ASEAN region. It is either the market leader or at 2nd position in most markets. If we look at the e-hailing landscape in ASEAN, the two players who compete across all e-hailing markets (e-hailing is not available in every market) are Grab and Uber. But then there are local players. A good example is Indonesia - the biggest e-hailing market in ASEAN - where the local player 'Go-Jek' is the market leader.

There are smaller local players in each market. It must also be noted that e-hailing is also compelling traditional taxi operators to innovate and improve. They are joining hands with e-hailing companies and in some cases, they are adopting technologies to counter the growth of e-hailing. We already know that several companies are considering entering the ASEAN e-hailing market and the ecosystem is likely to be very different in long term.

GF: How can Frost & Sullivan’s data and research bring value to a corporate customer?

AK: Frost and Sullivan works with every stakeholder in the mobility space. We have the experience of working with OEMs, auto leasing companies, e-hailing companies, taxi operators as well as car rental companies and we know the strengths and limitations of each player.

We also do customer studies, especially for fleet owners who are conscious of the complexity of the ASEAN market. Our understanding of the mobility ecosystem has already contributed many times to the design of successful corporate strategies. We can help a corporate customer select the optimal solution for their requirements. We notice however that Fleet Managers rely essentially on the information provided to them by OEM’s and Leasing Companies. Although extremely valuable, there’s much more to strategy design than looking at today’s available solutions; the fleet ecosystem is changing, and the Fleet Manager needs to make future-proof decisions.

Removal of CEO a perfect change towards stronger Uber

News of Uber co-founder Travis Kalanick resignation from his post as chief executive officer (CEO) on June 21 is a sign of changing times for the game-changing app, with analysts at Frost & Sullivan pegging this to be a chance for the group to regain strength.

On one end, shareholders are enthusiastic that Kalanick has finally stepped down from his leadership role at Uber as it signals a possible end to the current version of Uber that has been embroiled in drama over the past few years.

The drama reel includes several allegations of sexual harassment, sexist human resource practices, the covert use of law-enforcement-evading software, illegal obtainment of medical records of a user that was raped by an Uber driver, lawsuits by drivers, intellectual-property theft suits, and allegations of bullying tactics used to penetrate foreign markets and its local taxi industry.

The numerous issues found in Uber were said to have come from the company’s toxic culture.

In a statement released by market research company Frost and Sullivan, it highlighted that a particular incident cemented public perception of where that culture was coming from.

“The release of a leaked video, showing Kalanick berating an Uber driver who complained to him about pay, directly pointed fingers at the attitude and maturity of the former CEO,” said Frost & Sullivan associate director Animesh Kumar in a statement.

“The video spurred global commentary on the personal character and ethics of Kalanick and as a result forced the hand of Uber investors to request his resignation last week in order to quell the negative publicity.

“There is no denying the fact that Travis Kalanick is an asset and has been a driving force behind the success of Uber.

However at the same time, his personality, the work culture that developed under his leadership as well as the recent controversies has negatively impacted the image of the company.”

Thus, Animesh said Uber needs to change the image among the employees and drivers and has the perfect opportunity to do so.

“By bringing in leaders who are able to create a healthy work culture and are also growth-oriented, Uber would be able to put the controversies in the past and march ahead,” he opined.

Agreeing on his point, Kalanick himself expressed the move of his step down as a correct step for the company as he was quoted saying in statement obtained by The New York Times, “I love Uber more than anything in the world and at this difficult moment in my personal life I have accepted the investors request to step aside so that Uber can go back to building rather than be distracted with another fight.”

However, not everyone was convinced that the move was a right one as media outlets around the word reported on an alleged 1,000 strong signature petition to reinstate Kalanick being circulated amongst Uber employees.

Addressing this alleged call by Uber employees for Kalanick’s return, Animesh pointed out that Kalanick has not disappeared from Uber itself but has just taken a lesser direct role in its future growth.

“He will still own a major portion of the company and will remain as a board of director.

“Moreover, due to the structure, Kalanick and other co-founders have a high number of ‘super-voting shares’.

“So he has clearly not stepped away from Uber but has just stepped aside.” While some might find comfort in this, some stakeholders are also questioning the point of his resignation if Kalanick will continue to hold power in making decisions for the group.

To this, Animesh argues that Kalanick’s involvement in Uber’s future decisions and directions may not be detrimental at all as he has experienced immense success in penetrating and creating a foothold in hostile markets with high barrier of entries due to opposition from local taxi unions and industry regulators.

In addition, the potential presence of a changed and mature Travis Kalanick in the future could also significantly contribute to the emergence of a stronger Uber2.0 said Animesh.

Looking forward for Uber’s future, Animesh reports that the its first goal will most likely be to assembly a new leadership team to transform Uber into a new and improved Uber 2.0.

“Following an assessment by former US attorney general Eric Holder, Uber’s management and investors felt that there is a need of significant changes and with Kalanick’s resignation, Uber now needs to fill three significant positions in the top management – CEO, chief operating office and chief financial officer.”

Source: Borneo Post Online

Uber and Kalanick

Future of Uber Sans Kalanick

The news about the resignation of Travis Kalanick, the co-founder of Uber, from the position of CEO of the company has raised several questions regarding the future of the company.

Uber, a privately-held company, has a valuation of around USD 70 billion and is the world’s most valuable venture-funded tech start-up. However in recent times, it has attracted a lot of negative publicity. There have been several allegations including sexual harassment, sexist HR practices, covert use of law enforcement-evading software, illegal obtainment of medical records of a customer who was raped by an Uber driver in India, lawsuits by drivers and allegations of intellectual-property theft. The release of a leaked video, showing Kalanick berating an Uber driver, who complained to him about pay, directly pointed fingers at the attitude and maturity of the former CEO.

There is no denying the fact that Travis Kalanick is an asset and has been a driving force behind the success of Uber. However at the same time, his personality, the work culture that developed under his leadership as well as the recent controversies has negatively impacted the image of the company.

Following an assessment by former US attorney general Eric Holder, Uber’s management and investors felt that there is a need of significant changes. With Kalanick’s resignation, Uber now needs to fill three significant positions in the top management –CEO, COO and CFO. Uber needs to change the image among the employees and drivers and has the perfect opportunity to do so. By bringing in leaders who are able to create a healthy work culture and are also growth-oriented, Uber would be able to put the controversies in the past and march ahead.

But is Travis Kalanick completely out? The answer is NO. He will still own a major portion of the company and will remain a board of director. Moreover, due to the structure, Kalanick and other co-founders have a high number of ‘super-voting shares’. So he has clearly not stepped away from Uber but has just stepped aside.

His involvement in the decisions and directions may not be detrimental. He was immensely successful in penetrating and creating a foothold in markets, where Uber encountered relentless protests from local taxi unions and had to overcome hurdles presented by regulators. The presence of changed and mature Travis Kalanick could significantly contribute to the emergence of a stronger Uber 2.0

Animesh Kumar is Associate Director with Frost & Sullivan. He can be reached at animesh.kumar@frost.com

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