Strategic considerations for network expansion in the economic region Rio de la Plata Logistics Forum Bremen, 10th November 2011 Hans-Ludger Körner, Chief Financial Officer Röhlig & Co. Holding GmbH & Co. KG 2
The tango originated in Buenos Aires and Montevideo at the same time, on both sides of the Rio de la Plata The Tango is always in a move Everyone develops something new, and contributes to the fact that the tango is alive... as well as in Logistics 3
Viceroyalty of the Rio de la Plata (established 1776) The Viceroyalty of the Rio de la Plata was the southernmost of the Spanish viceroy empires in Latin America. It comprised roughly the present states of Argentina, Bolivia, Paraguay and Uruguay. 4
Agenda About Röhlig Criteria for network expansion Former status quo Facts on Latin America Challenges New structure Röhlig Latin America Actual growth 5
About Röhlig Start 6
Agenda About Röhlig Criteria for network expansion Former status quo Facts on Latin America Challenges New structure Röhlig Latin America Actual growth 7
Criteria for network expansion Growth Compatibility with existing network Manageability of processes Profitability Opportunity 8
Agenda About Röhlig Criteria for network expansion Former status quo Facts on Latin America Challenges New structure Röhlig Latin America Actual growth 9
Former status quo: Röhlig in Latin America before the current expansion Only Röhlig country was Chile 20 countries covered by Agents / Premium Agents Figwal (Brasil) largest agent and owned by former Röhlig employee Agents are in control of business (85% of all shipments) Lack of Economies of scale Lack of unified IT and processes 10
Agenda About Röhlig Criteria for network expansion Former status quo Facts on Latin America Challenges New structure Röhlig Latin America Actual growth 11
Growth potential in Latin America European Union 501 million people 27 countries Nominal GDP 16,4 trillion USD (2009) GDP: 2,0% (2010) Merchandise Trade 2009 (million USD) - Exports (FOB) 1.528.265 - Imports (CIF) 1.673.318 310 million people 1 country USA Nominal GDP 14,1 trillion USD (2009) GDP: 2,6% (2010) Merchandise Trade 2009 (million USD) - Exports (FOB) 1.056.043 - Imports (CIF) 1.605.296 Trades (USD) in comparison to European Union: 570 million people 21 countries Latin America Nominal GDP 3,9 trillion USD (2009) GDP: 5,7% (2010) Merchandise Trade 2009 (million USD) 38% 46% - Exports (FOB) 614.879 - Imports (CIF) 615.498 Trades (USD) in comparison to USA: 12
Facts on the former viceroyalty states Argentina Uruguay Paraguay Bolivia Germany People (mio): 40,5 3,5 6,4 10,9 81,7 Industries: oil, gas industry agriculture wood, meat mining industry (lithium, automotive, agriculture ore, silver, natural gas) mechanical eng. chemical ind. GDP / head (USD): 9.135 7.172 1.802 1.342 40.273 GDP total (billion USD): 370 22,9 14,8 13,2 3.286 Transp. infrastructure: Train + - - - + Road + +/- - - + Ship/Vessel + + +/- + (Rio de la Plata) (Rio de la Plata) - - 13
Argentina Export and Import information Quelle: WKO 14
Argentina Development of Quelle: GTAI GDP [annual percentage change; real] Quelle: OANDA exchange rates [ARS/USD] 2010 2011 2012 2013 2014 10,5 11,5 11,8 11,0 11,0 inofficial estimation = factor 2,5 Quelle: Wikipedia growth rate [export and import] inflation rate [annual percentage change] 15
Uruguay Export and Import information Quelle: WKO 16
Uruguay Development of Quelle: GTAI GDP [annual percentage change; real] Quelle: OANDA exchange rates [UYU/USD] 2010 2011 2012 2013 2014 6,7 11,5 11,8 11,0 11,0 inflation rate [annual percentage change] 17
SWOT analysis: Example Argentina Strenghts Natural resources Productive agriculture Transport infrastructure Level of education European affected culture Weaknesses Pro cyclical economic policy Weak local capital market while restricted access to international capital market Little competitivness of industrial companies Ranking in corruption index Opportunities Labor force potential Proven flexibility of employees/ companies Potential of renewable energies Potential for cooperation in research and technology Threats High concentration on few agricultural products Inflation pressure on staff costs and real upward revaluation of the Peso Incalculable market interventions of the government Possible shortages in energy supply Quelle: GTAI 18
Agenda About Röhlig Criteria for network expansion Former status quo Facts on Latin America Challenges New structure Röhlig Latin America Actual growth 19
Ranking Ease of doing business TOP 5 LATAM Quelle: The worldbank (http://www.doingbusiness.org/rankings) 20
Agenda About Röhlig Criteria for network expansion Former status quo Facts on Latin America Challenges New structure Röhlig Latin America Actual growth 21
Offices in Latin America after expansion Argentina Buenos Aires Rosario Uruguay Montevideo Paraguay Asuncion Bolivia La Paz Santa Cruz 6 Countries 8 Branches 108 Employees USA Miami (HUB) Chile Santiago 22
Agenda About Röhlig Criteria for network expansion Former status quo Facts on Latin America Challenges New structure Röhlig Latin America Actual growth 23
Growth Story Röhlig & Pro Cargo [Jobs/month] 1400% 1400% 1300% 1300% 1200% 1200% 1100% 1100% 2008 2009 2010 2011 1000% 1000% 900% 900% 800% 800% +50% +38% +95%* 700% 700% 600% 600% Network expansion Latin America 500% 500% 400% 400% 300% 300% 200% 200% 100% 100% 24 Jan 08 Jan 08 Mrz 08 Mrz 08 Mai 08 Mai 08 Jul 08 Jul 08 Sep 08 Sep 08 Nov 08 Nov 08 Jan 09 Jan 09 Mrz 09 Mrz 09 Mai 09 Mai 09 Jul 09 Jul 09 Sep 09 Sep 09 Nov 09 Nov 09 Jan 10 Jan 10 Mrz 10 Mrz 10 Mai 10 Mai 10 Jul 10 Jul 10 Sep 10 Sep 10 Nov 10 Nov 10 Jan 11 Jan 11 Mrz 11 Mrz 11 Mai 11 Mai 11 Jul 11 Jul 11 Sep 11 Sep 11 Nov 11 Nov 11 *) estimation