Focusing on Turkish Autogas Market

Transcription

1 Focusing on Turkish Autogas Market Ercüment POLAT Aygaz Marketing Director Sub Continent Regional Summit, New Delhi, India 15 February, 2012

2 Turkey is the 2nd largest autogas market in the world... Annual Sales (million tons) 5,0 4,0 3,0 2,0 1,0 0,0 South Korea Turkey Russia Poland Italy Japan Australia Turkish Autogas Market is; # 1 in Europe; 27% of Europe # 2 in the world; 11% of world 1 2

3 Sales volume exceeded 2,5 million tons Annual Sales(million tons) 3,00 2,50 2,00 1,50 1,00 0,50 0, Steady growth since 2003; 6% growth in 2011 LP Gas consumption has exceeded gasoline for the first time in

4 Numberof Vehicles (x1000) Turkish LPG Car Park has experienced significant growth... 40% % 37% % % 26% % 20% 19% Annual Increase in Car Park Total Number of LPG Cars Number of LPG cars reached to 3,2 million by the end of out of 10 passenger cars run on LPG! Biggest LPG Car Park in the world 4

5 The market is established but Competition is hard due to the presence of international oil companies and renowned Turkish LPG firms. Price reductions threaten the profitability of firms. Aygaz still leads the industry. Akpetgaz 4,1% Totalgaz 4,5% Other 22,1% Bpgaz 6,0 % SHV 6,8% Milangaz 7,5% Aygaz 18,5% Shellgaz 11,2% Mogaz 4,4% PO Gaz 14,9% 5

6 Promotion Activities Are Prohibited! Government pushes the distribution firms to lower the pump prices. To encourage competition on price; As of February 2011, all sales promotion activities except price deals, loyalty programs and free service offers were prohibited. Big firms focused on loyalty card and credit card campaigns. 6

7 Profitability or market share? A new local company broke into the market Price reduction strategy Initial investment: $ 500 million Instead of DODO, COCO Eliminating the dealer margin, price is cut by 7%. 12% market share in İstanbul within one year 7

8 Distribution network widens Autogas is sold in : filling stations 75% of all filling stations Availability and high service quality all around the country diminish autogas inferior product perception. 8

9 Car manufacturers show interest in autogas! 50% of the customers first decide on the car brand, then decide on the engine, so offering LPG option is critical. First factory-fitted LPG car, Fiat Albea, was launched by Fiat and Aygaz in Nowadays, 12 firms offer factory-approved LPG cars. Renault and Honda recently announced that LPG-converted models are added to their product ranges. 9

10 Underground parking restriction still exists! LPGcarsconvertedafter2004(%70 of the LPG car park) meet the safety standard ECE R 67, the rest will be satisfying it by 2014 at the latest. We carry on lobbying efforts in order to remove this restriction. 10

11 Taxes on fuels deeply affect the growth of car park Although high tax is a barrier for potential users against owning a car, it also is an advantage for LPG distribution firms since fuel economy gets more important. AUTOGAS Pump price ( /lt) TAX ( /lt) Tax ratio Turkey 0,99 0,44 45% Lithuania 0,65 0,28 43% United Kingdom 0,86 0,35 40% Poland 0,57 0,22 39% Italy 0,71 0,25 35% Bulgaria 0,67 0,21 31% Germany 0,76 0,22 29% Netherlands 0,79 0,21 27% France 0,73 0,18 25% GA SOLINE TAX ( /lt) Tax ratio Turkey 1,14 65% United Kingdom 0,91 59% Netherlands 0,99 59% Germany 0,92 59% France 0,90 57% Italy 0,88 55% Poland 0,61 52% Bulgaria 0,62 49% Lithuania 0,64 49% DIESEL TAX ( /lt) Tax ratio United Kingdom 0,91 57% Turkey 0,84 55% Germany 0,73 52% France 0,71 51% Italy 0,71 49% Bulgaria 0,60 48% Netherlands 0,65 48% Poland 0,52 45% Lithuania 0,48 40% 11

12 Gasoline and diesel car owners: Your potential users! We are trying to reveal the psychological barriers in the minds of potential consumers through researches. 10% of them are decided not to use an LPG car in any circumstances. 90% have the desire but hesitate to use because of: The perception of autogas as a more hazardous fuel Loss in engine performance Underground parking restriction 12

13 Information raising campaign helped a lot! In 2007, an information raising campaign was conducted by Aygaz The aim was to inform public that autogas is a: Clean, environment friendly Safe High performance fuel 13

14 Customer perception of autogas has been improved... We managed to change the poor reputation of LPG as an inferior, unsafe and low performance fuel in the minds of LPG car users. Perception Scores of Customers (Out of 5) 4,4 4,47 4,444,47 3,93 4,07 4,154,25 4,25 4,37 4,18 4,32 4,46 3,79 3,9 3,92 3,59 3,71 3,57 3,69 3,77 3,33 2,85 2,47 Autogas is safe Autogas is environmentfriendly Autogas provides high performance I use it without any doubt May 05 December 07 February 08 July 09 July 10 October 10 14

15 Still Turkish autogas market has a great potential Turkish passenger car park: 7,6 million Passenger cars per inhabitants: 104 Turkey has a potential to increase its car ownership rate with its developing economy. Passenger cars per inhabitants Italy* 603 Germany* 551 France* 490 United Kingdom* 463 USA 450 Japan 440 South Korea 220 * Source: European Environment Agency 2010 report 15

16 THANK YOU... 16

17 Market has been transforming from cylinder gas to autogas Total 3,4 million tons Only 9% growth Total 3,72 million tons Cylinder 2,15 million tons (%63) Bulk 0,90 million tons (%26) Autogas 0,35 million tons (%11) X 8 Cylinder 0,98 million tons (%26) Bulk 0,1 million tons (%3) Autogas 2,64 million tons (%71) 17

18 As a result In order to increase your sales: Invest on marketing and R&D to differentiate the product Build good relationships with conversion specialists Encourage car manufacturers Inform and influence potential car users Carry on with the lobbying efforts 18

19 You have to build reputation through testimonials Conversion specialists network is the perfect channel! The first contact point for LPG customers We have founded Aygaz Conversion Centers Club. Aims: Being the moderator and delivering their problems to the authorities Providing monetary benefits to the members Helping them advance their service quality 675 registered firms (%60 of all) have joined the club! 19