Seera’s subsidiary Lumi to roll out car-sharing platform, increase fleet size in 2021

 Lumi Vice President Azfar Shakeel

Lumi, the car rental business of Saudi-listed Seera Group, will purchase 6,000 new vehicles this year and launch a car-sharing platform shortly, company vice president Azfar Shakeel told Argaam in an exclusive interview.

The company has already purchased 1,500 vehicles in the first quarter of 2021, with the vehicle mix consisting of Toyota, Hyundai, BMW, Ford, Nissan etc.

Though COVID-19 has impacted businesses, the situation is constantly improving, with the company expecting regional tourism to recover mostly in the second half of 2021.

“Where we stand today is much better compared to the same period in 2020, and we are expecting this to further improve in 2021,” Shakeel stated.

Below are the excerpts of the interview.

Q: What is Lumi’s strategic growth plan for 2021?

A: During the past year, we have seized opportunities across our business-to-business (B2B) and business-to-consumer (B2C) business verticals and have invested in the intensive development of products and services that will be crucial for the enhancement of the car rental experience in the Kingdom.

Our main strategic growth plan for 2021 is to enhance our digital service with a fully-fledged new app and web offering to generate online revenue, as well as complete our branch retail roll-out that will, in combination with our digital offering, serve our customers with an omnichannel car rental experience.

We want to make the B2C car rental experience more efficient, fast and convenient. We are looking at digital-first solutions to enhance the experience across the board. Our plan is also to expand our corporate and government businesses, as leasing contracts contribute to a large percentage of our revenue.

Q: Are you bidding for additional airport counters in Saudi Arabia?

A: Lumi is expanding its retail service network in Saudi Arabia, having won the bid to open counters at Jeddah King Abdulaziz International Airport, Ta’if Regional Airport and Al-Baha Domestic Airport.

These join the current network of eight airport counters and the total network of 26 branches in the region. We have already made our presence at most domestic airports and can enter a few more based on availability and traffic.

Q: Lumi has the youngest rental fleet in the Kingdom, with over 80% of cars under 12 months old. How does it help in terms of generating business compared to your competitors?

A: We have made the experience from customer engagement, but also through customer research we have conducted over the past year, that in the rental business, customers prefer the newest vehicles, and this is what Lumi is providing them. This has helped us a lot in our market share growth in the industry.

We have pursued our vision of transformation across the organization and are heavily investing in the digitization of products and services, as well as training our teams to become the best travel advisors in the region and beyond. The automation of processes and the evolution of customer service channels also played a big role.

Q: Lumi purchased over 4,000 cars in 2020, with a majority of fleet additions coming from Toyota and Hyundai. What are your plans for increasing fleet size and vehicle mix for 2021?

A: We have already purchased 1,500 vehicles in the first quarter of 2021. With multiple deals in hand and growth in our retail rental infrastructure, we will be buying 6,000 vehicles in 2021. This would be a mix of vehicles including Toyota, Hyundai, BMW, Ford, Nissan etc.

Q: What is your strategy on overhauling your fleet?

A: We have a competent team of mechanics in four in-house workshops and 15 plus mobile workshops to manage preventive maintenance of our vehicles. SOPs have been defined to maintain our fleet in a timely manner. We also have partnerships with the biggest maintenance service providers across the Kingdom with over 700 locations to maintain our vehicles, in addition to partnerships with 30 proper workshops.

Q: Do you plan to add electric cars to fleet? How do you see demand for these vehicles?

A: With several new smart projects in Saudi Arabia, we do see demand for electric vehicles in the coming years. This is being planned now.

Q: Do you have plans to roll out a car-sharing platform in Saudi Arabia?

A: We are developing a car-sharing platform according to the Saudi market requirements, which will be launched soon.

Q: How much competition do you face from ride-sharing apps in the Kingdom?

A: Our target customer base and their needs are different from those who use ride-sharing apps; it is a competitive field but what differentiates us is our focus on quality, hygiene and service standards.

Q: How did you manage your operations in 2020 amid COVID-19 following the precautionary closure measures at airports/malls?

A: We provided our service proactively and created time-saving processes, including the digitization of the entire operations at the airport counters. The “Tamm” service has also been integrated to speed up the authorization for customers looking to rent a vehicle. Lumi’s digital-first branches will also feature ID scanners and agents onsite for consultation.

Further, as part of the group’s larger initiative, “Seera Safe”, Lumi has launched various safety initiatives, reassuring customers of the highest health and safety standards.

Enhanced cleaning procedures include a thorough sanitization of all vehicles before rental with utmost attention paid to high touch point areas.

Temperature checks of staff and visitors have been activated at all the airport counters. Social distancing measures are practiced, and digital processes and payments reduce physical contact.

Q: Do you still see the pandemic impacting your growth forecast for 2021?

A: The impact is there, but the situation is constantly improving. Where we stand today is much better compared to the same period in 2020, and we are expecting this to further improve in 2021. We will see regional tourism recover to a large extent, especially towards Q3/Q4 2021 – as Seera, we will emerge stronger, as we have used the downtime to set the foundations in place.

Q: Are you meeting your Saudization targets?

A: We already comply with the local Saudization percentage required and are striving to enhance this with the stabilization of the market.

Write to Parag Deulgaonkar at parag.d@argaam.com