TSL banks on after-sales service boost
Luxury car importer TSL Auto Corporation expects its sales to recover to growth this year, boosted by after-sales service, after a sharp drop last year.
Sales in 2016 dropped to 1.2 billion baht from 1.5 billion in 2015.
Chief executive Sureeporn Udompolvanich said the after-sales service unit is expected to generate 300 million baht worth of revenue for the company this year, up from 200 million last year.
The after-sales service unit is operated by TSL’s subsidiary firm, TSL Auto Services, founded in November 2014 with registered capital of 8 million baht.
Higher revenue prospects will be generated by its new showroom and service centre on Boromratchonnanee Road, which was set up for 300 million baht and has already begun operations.
The Boromratchonnanee branch is TSL’s fourth outlet on top of its head office on Chaeng Watthana Road, its Thong Lor branch and its Phuket branch.
“TSL now has service capacity of 3,000 cars per month, up from 2,000 last year,” she said. “More importantly, the new location covers demand from luxury car users in Thon Buri district, while TSL will seek out new destinations in the northern and eastern metropolitan areas over the next several years.”
Ms Sureeporn said TSL’s main focus right now will be the domestic market, thanks to the growth in luxury car sales every year from both authorised and grey importers.
A couple of years ago, TSL closed its aftersales services in Myanmar’s Yangon after the location failed to turn a profit.
She said TSL is also seeking partnerships with other luxury used-car operators and small grey importers to serve TSL’s after sales service.
Ms Sureeporn projects revenue from after-sales services will account for 23% of its total revenue this year, up from 16% last year.
The company plans to raise that ratio to 30% in the near future thanks to branch expansion.
For TSL’s new luxury car sales, she said sales revenue is expected to stay flat at 1 billion baht this year or 300 units sold, which is equivalent to last year’s sales.
In total, the company expects its consolidated revenue to grow by 8.3% to 1.3 billion baht this year.
Ms Sureeporn said doing business as a grey importer remains very tough because of many obstacles such as tightening inspections from the Industry Ministry, cost increases, insurance and freight (CIF) rates for imported cars and a refusal by authorised distributors to provide services for cars imported by grey importers.
The Customs Department raised the CIF rates for imported vehicles by 10-20% in October 2015.
Ms Sureeporn, who is also vice-chairwoman of the Independent Car Importer and Distributor Association, forecasts Thailand’s overall grey market will be flat this year, with sales value below 10 billion baht.
“Unlike the past several years, when sales fetched over 20 billion baht a year, the current grey market is in a tough spot,” she said.