Andres Hernandez, TraXall: Increasing Latam footprint with new CEO appointment
International fleet management company TraXall has just took a step toward increasing its footprint in Latin America with the recent appointment of Andres Hernandez, the company’s new CEO for the Latam region.
Besides helping companies in Latin America face today’s challenges (e.g. volatile oil prices, weakening local currencies and the new threat of COVID-19), the company is focused on building operational fleet management throughout the region and increasing the number of cars it serves, according to Mr. Hernandez.
Join Fleet LatAm, the Latin America arm of Global Fleet, in our brief interview with the executive from the TraXall Latam headquarters in Bogota Colombia.
Could you first start by telling me about your Latin America footprint?
Hernandez: We established our headquarters in Bogota Colombia five years ago due to its forecasted economic performance. Besides boasting one of the best GDP growth performances in Latin America since then, Colombia has legal stability, a good work ethic, and a government that supports business models like ours.
We also have offices in Peru, Chile, Brazil, Argentina and Ecuador, and manage fleets in seven other countries. They are Panama, Costa Rica, Honduras, Nicaragua, Guatemala, the Dominican Republic and Trinidad and Tobago.
From what I know, TraXall manages nearly 190,000 vehicles worldwide, but what is the size of your fleet in Latin America?
Hernandez: We currently manage 7,400 cars. Our largest fleets are in Colombia (3,000 cars), Argentina (1,000), and Peru (1,000). We are in the process of kicking off operations in Brazil where we will surely see great results in the medium term.
TraXall's network of local offices (source: TraXall)
What is TraXall’s mid-term goal in Latin America and what do you see as a challenge to getting there?
Hernandez: Through greater loss control, better analytics and by reducing TCO (total cost of ownership) for our clients, our goas is to reach 10,000 managed cars by the end of 2023.
However, with Coronavirus and the drop in oil prices recently, we all know that the world is a complicated place today. And when adding the devaluation of Latin America currencies against the US dollar, this will undoubtedly put the brake on economic growth in general.
With that said, our objective is to develop strategies aimed at helping companies face and overcome these challenges as well as to implement operational fleet management and increase the number of cars we manage.
How do you see the future of leasing in Latin America?
Hernandez: In Latin America, owning a vehicle is the tendency. To me, this is somewhat understandable for individuals but not really for companies.
Little by little, vehicle leasing has been growing in the region but there is still a long way to go. The ratio of fleet (leasing) cars to the overall number of cars registered is far from the ratio found in Europe.
Besides being a cultural issue, it is partially due to the fact that leasing is still very high in Latin America compared to Europe and North America.
Overall, achieving more leasing in Latin America is a slow process. As more international leasing companies arrive in the region with more competitive offers, we will see the industry grow incrementally.
Could you point out some of the other trends impacting vehicle fleet and mobility management in Latin America?
Hernandez: In general, the new mobility trends seen in other parts of the world are still incipient in the region. In less than 15 years, while the population of Latin America has grown by more than 100 million inhabitants, mobility solutions have not excelled at the same rate.
Although some efforts are seen in countries such as Mexico, Brazil, Colombia and Chile, restrictions in technology and access to it are increasing the cost of setting up the needed infrastructure and leaving us behind.
Besides technological difficulties, the MAAS (mobility as a service) model in the region is facing government obstacles, cost overruns and insecurity overall.
However, in terms of electric car sales, the country showing the highest growth rate is Colombia, thanks to the fiscal benefits the government provides and legislation which allows for the free movement of these types of vehicles.
These vehicles are still quite expensive in the region and this continues to be the main obstacle affecting the purchasing power of individuals and companies in the region.