‘We will pursue our international customers present in India'

Mr Yves Fargues

We specialise in handling complex logistics operations. For instance, we supply the 15,000 components for a car from Europe to Brazil on a just-in-time basis. In terms of value, it's not that much. But it makes the difference to our customer's business.

GEFCO — a Euro 3.4-billion company that specialises in automotive logistics — is a wholly-owned subsidiary of French carmaker PSA Peugeot Citroen. Globally, GEFCO's clients include GM, Renault, Toyota, Ford, Volkswagen, BMW, Yamaha, Piaggio, Novartis, L'Oréal, Ikea, Sony, Philips, Schneider and Unilever. GEFCO is present in India through Mercurio Pallia, a 50:50 joint venture between Gruppo Mercurio and Pallia Transport. GEFCO acquired a majority stake in Gruppo Mercurio in mid-2011. Mr Yves Fargues, Chairman and CEO, GEFCO, who was recently visiting India, spoke to Business Line about India's transportation industry. Excerpts from the interview:

What is your view on the Indian transportation market?

India is an emerging, fast growing economy. The market is totally oriented to haulage, which is quite natural. The growth is rapid, and it requires a lot of investments. It is a market which is slowly becoming mature. The market will need to have more subcontractors. That will be one of our efforts — to try and develop a subcontractor base that meets our standards.

Who will be your subcontractor?

The sub-contractor for us will be somebody who can be in charge of our haulage. When you bring components to the plant, or take out finished goods from a plant, the quality has to be well maintained. So, the subcontractor has to fit into our system of reporting on IT processes, using global positioning systems. We need to build that expertise among our subcontractors.

Your company is known to have the edge in value-added services. Could you elaborate?

We specialise in handling complex logistics operations. For instance, there are 15,000 components in a car. We supply the components from Europe to a plant in Brazil on a just-in-time basis. In terms of value, it's not that much. But, we can organise, we can report, we can reward — that makes the difference to our customer's business.

Could you list the top two-three points which, if addressed, could make it easier for you to do business in India?

At a basic level, we would like better infrastructure; fewer borders between States; and we need trained drivers. We would want our drivers to be behave well on the road and drive responsibly.

To what extent would safer drivers impact your business?

Driving safely on roads sets an example, leads to less accidents, adds to our image because we are a responsible company. It would also add to image of our clients.

Do you plan to get customers whom you serve internationally, but not in India, into your stable in India?

Yes, we will pursue our international customers who are present in India.

Would those customers be from the automobile sector only? Would they also be from non-automobile sectors such as L'Oreal?

They will be from across sectors. We have been here for seven months. I won't mention any names, but we will try hard, very hard. There is no contract to be signed immediately.

How different are contracts between logistics service providers and customers in India, when compared with international norms?

The contract here is also sophisticated, though adapted to local conditions. We have obligations to report, timely delivery targets to meet.

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Published on January 10, 2012

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