He seems a bit shy during the first minute of the interview, but Carmudi Philippines managing director Subir Lohani becomes quite savvy, as he talks about online trading business, showing he is in control of himself and the new company he leads.
“The job is very exciting. I just want to try something different. I might as well do this while I’m younger and not yet married and have commitments,” the former investment banker who was born in Nepal, but grew up in the Philippines, says in an interview.
Lohani heads Carmudi Philippines, an online matchmaker between car buyers and sellers. “The web works like an auto matchmaker, either a business or somebody who wants to sell a car, or buyers looking for a deal. So we created this platform. What we do is we provide high-quality data, pictures about a specific vehicle when we put them online and also search functionality,” he says.
“This is a new learning for me, about the industry, online trading and automotive. I am also learning about public relations, effective e-marketing, and on the operational side, how you handle the business, revenue generation, that sort of things,” says Lohani.
Car trading
Lohani says he is excited to wear this new hat and see how he can expand the company’s footprint as an online platform for trading new and used cars in the Philippines.
As the company gains momentum, a year after it was launched, Carmudi is revving up with plans to expand to cities in Mindanao and the Visayas. With a hub in Manila and a satellite office in Cebu, Carmudi also mulls over putting up offices in Davao and Subic.
“From our Cebu office, we can actually do both Cebu and Bohol. North Mindanao is also covered by Cebu. We’re evaluating Davao to see if it makes sense or if it’s too spread out. Also, we’re likely to put a few people on the ground in Subic to cover Pampanga and Tarlac since it’s too difficult to do it from Manila which is three-hour drive away. Plus, they have a very high concentration of commercial vehicles like trucks that they do import from Japan and auction here,” Lohani says.
Raised in PH
Having been raised in the Philippines, Lohani has a soft spot for the country and anything that it offers. When he was offered a job to be at the helm of the online automotive trading company, he says he did not have any second thought.
“I left investment banking. I want to try something different,” Lohani says, after spending six years in Singapore as an investment banker.
He had worked for three different investment banks in Singapore for six years, before moving back to Manila.
His family migrated to the Philippines from Nepal when he was young, as his parents took on assignments for a development bank based in the Philippines.
“My parents moved to the Philippines when I was only six months old. Basically I grew up here my entire life before I went to university in the US,” says Lohani, who now lives in Ortigas.
From kindegarten to high school, Lohani took his primary and secondary education at the International School Manila. He went on to study at the Boston University in the US. He also studied at the Beijing Language and Cultural University in China for a certificate in Basic Mandarin.
“Then I moved to Singapore to work with investment banks. I just actually came back last June [2014],” he says.
Multi-lingual
Lohani is well-versed in Nepali, English, Filipino, Spanish, Mandarin and Hindi, a trait he found useful working for multinational companies such as Rocket Internet, the parent company of Carmudi.
He came from a family of bankers, as both his parents work for a developmental bank in Manila while his sister works for the International Finance Corp., which is a unit of the World Bank.
“My mom and dad still work here and my elder sister is always travelling, part of her work at the IFC,” he says.
With his new job at Carmudi, Lohani is always on his toes for innovations that will enhance the company’s online site and the way they do business. “The company started out testing for other countries. They were Mynamar, Mexico Nigeria. Once they saw it work in those markets they they rolled it out in ten plus countries including the Philippines. Beginning last year, we went from zero on the ground in January to almost 35 people by end of the year,” he says of the company’s origins.
He says compared to the dedicated car platforms, the company is number one in terms of total listings or total number of vehicles on its website.
Matchmaker
He says usually, people search for two things. “Either they know the brand or they’ll just put in a price range,” he says. “From our dealers they can request for more information or whether they want to see it. It makes the initial process to identify significantly easier than sort of walking around.”
Carmudi currently has more than 2,000 dealers across the Philippines and close to 700,000 visitors on the website every month. He says of 700,000 visitors, 50 percent are first-time users.
Lohani says the company can quantify those using the site but they have no means of tracking point-to-point end of sales.
“It’s very difficult. We’re working on it with a lot of dealers. The dealers are very different in terms of sophistication,” he says.
Apart from the usual dealers, the company also deals with banks as dealers of repossessed cars.
Global presence
Globally, Carmudi operates in 20 countries across Asia, Africa and Latin America.
Asia and Mexico are the largest markets of Carmudi’s operation while Africa is still developing.
The Philippines is actually one of the main focus markets in Asia along with Indonesia with 350 million people, says Lohani.
“It’s fun to still go into markets that are still emerging. They don’t have limited competition. We just want to win in the markets we are in. The middle class goes up and people are going to end up buying cars or motorcycles. The Internet savvy and mobile penetration here [Philippines] is 111 percent. You have more mobile phones than people,” says Lohani.
Lohani says Carmudi is focusing on developing and emerging markets with vast potential for Internet penetration.
“Rocket International in general, wherein Carmudi is a part of, we hardly touch China in the same breath that we hardly touch the US because those markets are very specific,” he says.
Lohani says the automotive market in the Philippines is just starting to take off, but economic developments show that the growth may be sustained over the next ten years.
He says among the factors that will lead to continued growth are the propensity to buy more vehicles whether motorcycles or cars; introduction of cheaper vehicles that are either China or Korean made and the rise of more manufacturers.
“They need to make vehicles more affordable in this country. For instance, you see high penetration rate of vehicles in Thailand and Indonesia, simply because the cars are there. They’re cheaper, the servicing is there. The problem here is that if you buy a foreign car in the Philippines, sometimes just to get that car serviced is amazingly expensive because they have to bring in the parts from somewhere else,” he says.
“But if they manufacture here, the entire supply chain gets created. You need to have somebody supplying the parts and somebody who’s assembling that. Then everything becomes more efficient,” he says.
Market dominance
With over a year in operations in the Philippines, Carmudi believes it will maintain its dominance in the market, “simply because we’ve already established market leadership in a way for the dedicated online vehicle platforms”.
“We don’t compare ourselves to the general classifieds because we think that what we provide is a different user experience compared to what the general classifieds do. People can try to come in, but it will be difficult for them to compete with us, even on how we do account management, how we deal with the clients and also the sources we put in the market,” Lohani says.
He says in 2015, the company will try to reach out to the larger segment of the population in the cities they operate in, as the B to C market is almost saturated. Despite this, Carmudi will not sacrifice the quality of information which it is known for, Lohani says.
“For private people posting their vehicles, it’s still 100-percent free. But for the commercial car dealers we do charge them, because we provide all kinds of services. Like we actually go and collect the data, take pictures and write down all the information, bring it back and upload. Then you have a dedicated account manager who’s calling you for updates,” he says.
The company has 45 people on the ground across Manila and Cebu. It is also looking at other cities with dense concentration of registered vehicles, says Lohani.
Facebook users
One good thing about the Philippines, compared to other countries where Carmudi operates in, Lohani says, is that people are relatively more educated with young demographics and nearly everybody is on Facebook with 93 penetration rate, the highest in the world next to Brazil.
“Most people have been introduced to buying and selling stuff online or on the e-commerce website. They’re used to doing it. It’s like a natural progression. If they want to see a car why not check it online as well,” he says.
Given the size of the economy, the volume of registered cars remains very low, he says. “Last count was 850,000 registered cars, 4 million motorcycles and total of 6.9 million plus commercial vehicles. There’s still a huge room to expand,” he says.