The developing car leasing market in Algeria
Long term rental is meeting with success in Algeria, especially as new vehicles can be difficult to come by in dealerships. Mourad Saadi of Le mensuel de LAutomobile in Algeria explains what the leasing landscape looks like in the country.
Two leasing companies dominate the market, internationally renowned ALD Automotive, and young enterprise Entraser. Both are dynamic and look to meet client demands through the quality of their service.
While ALD Automotive clearly has much more experience, Entraser is putting its stakes on efficient structuring to meet the challenges it faces. And indeed, both companies have to deal with the risk factor, the turning upside down of the market from a vast offering of vehicles to a scarcity which recalls the 60’s and 70’s, the crucial factor of good management, client satisfaction… and all this within an automobile market which suffers from lack of visibility.
Looking first at market leader ALD Automotive, it is banking on innovation and expanding its network. It has set up VIP points in 6 prefectures, with 11 welcome points, a number which is to increase to 19 this year. It has also inaugurated a new infrastructure in Oran, capital of the West of the country. Others will open in the East, following studies.
In the domain of innovation, ALD Automotive has is providing its clients with integrated digital solutions, destined for both fleet managers and drivers. My ALD, the company’s eco-driving program, has also been introduced into Algeria. This allows drivers to configure the vehicle, see contract details and find service suppliers. The program will be available on smartphones and tablets at a later date. For fleet managers and their reporting needs, ALD Automotive has also introduced ALD Net, which can provide report on key information on fleet analysis.
ALD Automotive is the first lease company in Algeria to have established this integrated digital environment which brings together the leasing company, fleet manager and drivers. In terms of its ambitions, ALD Automotive is hoping to have 4,100 vehicles under contract this year (from around 3,600 now), and to update its ISO 9100 2015 certification to 2017. The company bought almost one thousand vehicles last year, according to its Managing Director, and disposed of 780.
Moving on to Entraser, it is concentrating, among others, on the quality of its after-sales service. Aware that this domain has always been greatly lacking in Algeria, Entraser has established a network dedicated to client needs. This is made up of either its own premises or of agreements with third party operators specializing in maintenance and repairs, and covering strategically selected geographical locations across the country.
As is the case with other developing markets, the clients of leasing companies in Algeria tend to be foreign companies with experience of the system elsewhere. Entraser, however, also numbers some public bodies among its clientele.
A factor which works against rental, however, is that if it is considered that the monthly rental charge includes any form of interest payment, this is unacceptable in Algeria from a religious point of view.
And finally, a mention of some of the other players on the Algerian marketplace: Cevicar, KTP, Sovac Rent Car, which along with Entraser, represent in roughly equal proportions the half of the market not claimed by ALD Automotive.