ROMANIA-RUSSIA Russia, a strategic market for GEFCO

Anca Iovan (Translated by Cosmin Ghidoveanu)
Ziarul BURSA #English Section / 18 aprilie 2012

"Our main investment is in our employees", said Tolga Oran.

"Our main investment is in our employees", said Tolga Oran.

GEFCO operates on the global logistics market for the industrial sector. Through its six key areas of expertise - Logistics, Gefboxsystem, Overseas, Overland, Vehicle distribution and VAT - GEFCO proposes solutions for all the requirements of industrial logistics, both locally and internationally, intended for the upstream and downstream manufacturing processes.

In 2004, GEFCO created its first subsidiary in Romania, and one year later, at the end of 2005, its first branch in Romania was created. GEFCO Romania has three divisions and can provide customers with all types of logistics services. GEFCO Romania currently operates two logistics deposits - Bucharest (4000 sqm) and Arad (1100sqm) - and three platforms intended for car logistics: Curtici, Mioveni, Bucharest.

GEFCO is present in 150 countries of the world and ranks among the top ten European logistics groups, with a turnover of 3.4 billion Euros in 2010. The group has 400 locations all over the world, has over 9,400 employees and is developing its activity in: Central Asia, Central and Eastern Europe, the Middle East, East Asia and South America.

Interview with Tolga Oran, Sales and Marketing Country Manager of GEFCO Romania

Reporter: How did the turnover of GEFCO Romania evolve in 2011?

Tolga Oran: Last year, the turnover increased 32% compared to 2010. This was achieved due to the fact that the contracts with the major clients were extended, as well to the development of the strategic sectors, such as white goods, cars or electronics.

In 2011, we had a turnover of 43.35 million Euros.

Reporter: What are Romania's strong points for GEFCO?

Tolga Oran: I can tell you that, for the company I represent, the main strong points of the Romanian market are its access to the Black Sea and the shared borders with certain markets such as Russia, which is strategic for GEFCO and for GEFCO Romania. We have very specific expertise on this market where we manage our import/export flows for the customers operating in the following sectors: car industry, white goods, retail.

We are however faced with the flawed Romanian road infrastructure, as the highway network has very big construction and completion delays.

Reporter: What are the economic relations of GEFCO Romania on the Russian market?

Tolga Oran: GEFCO Romania handled significant volumes starting in 2008 and currently handles about 150 shipments a month. Aside from managing flows, GEFCO Romania offers added value services such as customs services, regional expertise, and procurement from several countries to ensure maximum capacity.

GEFCO set up a branch in Russia in 2003 and has four locations with its own licenses of customs brokers; GEFCO's locations in Russia are Sankt Petersburg, Moscow, Nizhni Novgorod, Rostov.

On a global level, GEFCO Group implemented a multimodal project, between Europe and Russia, with a daily train between Vesoul (near Paris) and Kaluga for SKD shipments (Semi Knocked Down - ed. note: partially assembled components) to be assembled at the plant of Kaluga.

Reporter: How was GEFCO affected by the economic crisis, after the dramatic drop of foreign investments in Romania?

Tolga Oran: During the crisis and way before it, we took steps at the group and local level, to lower operating costs. Due to this preventative measure, we only had a drop of 2.5% in 2009, whereas the logistics and transport market fell 20%-30%.

Reporter: What are the types of services which GEFCO offers in Romania and how much do they represent compared to the total turnover?

Tolga Oran: We offer the full range of services which GEFCO offers on a global level: road, air, maritime transport, storage and related services (order preparation, trans-shipment), multi-modal transport, customs services, transports and logistics for finished vehicles.

The customs brokerage services are something we have just launched: we have implemented a customs department and we have our own customs agent; we also offer warehousing services on our platform of Bucharest and Joiţa.

Reporter: What are the main competitors of GEFCO on the Romanian market? What is the value of the Romanian logistics market, and how do you feel it will evolve in the coming years?

Tolga Oran: Our direct competitors are the international logistics integrators (3PL - ed. note: the logistics operators who ensure storage missions, associated operations -handling, order preparation, providing supplies for production, handling transit etc. -, as well as transporting goods with their own means of transportation).

If by the logistics market we are referring to the storage and added value services, we expect growth in the following areas: Oltenia, Piteşti/Ploieşti, Timişoara/Arad.

Concerning the transports market, we are expecting it to grow more on an international level than nationally.

According to statistics, we rank second on the Romanian market (on the logistics operators category), according to our 2010 turnover.

Reporter: Who are your main customers?

Tolga Oran: The beneficiaries of GEFCO on the Romanian market are: Electrolux, Dacia Renault, Arctic, Delphi, Takata, Ford, Ikea, Kiabi.

Reporter: What segments of customers do you plan to attract in the future?

Tolga Oran: We want to gain new customers in the following sectors: auto, aerospace, electronics, industry, retail. We are also focusing on strategically important customers and on the corporate market: car makers, vehicle suppliers, aeronautics, industry, 2-wheel vehicles, electronics, FMCG/retail.

Reporter: What investments did you make in Romania so far and what are your plans for the coming years?

Tolga Oran: Given that GEFCO is a company without assets, our main investment in our employees, for whom we constantly implement trainings and internal development plans. We have constantly increased our number of employees over the last few years and we plan to hire more people this year.

As for the fleet, we have a fleet which we manage together with our partners, and for the transport of finished vehicles, the GEFCO group has more than 5000 train cars; we have imported train cars from France in Romania to operate the railway flows from the outside for the automotive industry.

Reporter: Is Romania a strategic market for GEFCO?

Tolga Oran: If we review the development of GEFCO Romania over the course of the last three years, Romania is definitely a strategic market for GEFCO.

There is still a great potential for overseas business, and as a business sector, we are expecting huge growth in the retail area, as well as in industry (aerospace, metallurgy) as well as in the automotive sector.

We are very close to being market leaders and we would like to continue to grow by maintaining the growth rate we had in the previous years.

Reporter: Is GEFCO Romania interested in a potential acquisition of the Romanian Railways (CFR)?

Tolga Oran: These acquisitions are decided at the corporation level; therefore, we can't make any assumption about potential acquisitions.

Reporter: Thank you!

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