UK marketing chief John Stocker explains the automotive specialist’s strategy to Johanna Parsons.
Gefco is looking out at a very different world now from the one it inhabited just a year ago. Then it was part of the PSA Peugeot Citroen group providing logistics services for car manufacturing operations.
Today it is 75 per cent owned by JSC Russian Railways, and is taking on increasing levels of third party business – notably a huge contract with General Motors.
John Stocker, who joined recently as UK sales and marketing director, points to growth in new markets and with new clients which has offset the difficult economic conditions in Europe which hit profits last year.
Gefco reported an operating income of €109 million for 2012 compared with €223 million in 2011. The group’s turnover, was €3.6 billion for the year ending 2012, slightly down on its 2011 figure of €3.8bn.
But revenue from major international customers grew by four per cent year on year to €1.5bn, or 42 per cent of total turnover in 2012 compared with 38 per cent in 2011.
Over the next five years Gefco aims to become a leader in logistics for industry in the world’s fastest-growing markets, and it reckons that the backing of Russian Railways offers the group solid prospects.
Gefco Russia already grew by nearly 11 per cent in 2012. With the results of a joint venture Algaï included, its Russian business grew by 22 per cent in 2012.
The strategy for international expansion has focused on markets such as Central Asia, Central and Eastern Europe, and the Middle East, where the group’s overall growth reached 17 per cent in 2012.
Gefco also set up subsidiaries in Dubai and South Africa and plans new openings in Mexico, Croatia, Serbia, Algeria and Singapore.
And with regard to new clients, Stocker points to the firm’s growing client base in automotive manufacturing.
He says that in the past some of these businesses were wary of working with Gefco because of its status as a subsidiary of PSA Peugeot Citroen. But with the change to its ownership stucture last year, attitudes have changed.
“Since the ownership change they’ve been a lot more engaged… They see us now as being independent of another automotive manufacturer, and they know we’ve got the expertise.”
In one of the largest ever logistics agreements in the European motor industry, this year has seen Gefco take over the majority of General Motors’ logistics business across Europe including Russia.
Naturally Stocker expects this deal to have a big impact on the 2013 trading figures, and he says the firm has established its own 4PL business especially to handle the contract.
Stocker also expects the UK to contribute to his predicted growth. He says that the UK has bucked the general trend of depressed growth in Europe. “Although the UK economy is still under discussion, shall we say, it is clear that the automotive sector is developing.
“In the UK we’ll continue to work on the finished vehicles business which we have a strong founding in.” And he says the firm is also developing its distribution network and a new track and trace system, as well as putting more emphasis on its Euro-daily freight service and its market leading position in the two-wheeler distribution market.
Stocker says “The business has a strong growth target and it’s exciting to be in a business looking for growth.”