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Logo of Phnom Penh Post newspaper Phnom Penh Post - Auto, construction drives Bosch

The managing director of Bosch, Andre de Jong
The managing director of Bosch, Andre de Jong, at the Robert Bosch (Cambodia) head office in June last year. PHOTO SUPPLIED

Auto, construction drives Bosch

Bosch has recorded double digit growth in the Kingdom since 2010, backed by developments in the country’s automotive and constructive sectors. The Post’s Ananth Baliga spoke to Andre de Jong, managing director of Robert Bosch (Cambodia), about sectors that will drive future growth and Cambodia’s competitiveness in the region.

Bosch announced double digit growth for 2014. How much did the company grow in Cambodia?

The growth of Bosch was around 50 per cent. If you calculate from the year we opened our representative office, which was in 2010, it is the fourth consecutive year of strong double digit growth. For example, the automotive growth in Cambodia is 300,000 cars or almost 40 per cent from the previous year.

We have been able to bring in more products and solutions in the automotive sector. In terms of construction, for us our power tools and security systems play an important role.

The construction growth is tremendous in the last few years – especially the high-end construction is booming. These are triggering our growth.

Which of Bosch’s four business verticals are driving this growth?

We have mobility solutions, which in our case is the automotive aftermarket business sector. Consumer goods are mainly power tools. Energy and building technology includes hot water or stream boilers and industrial technology has packaging machines or hydraulics and drives that power conveyor belts.

You see, these businesses sectors are not overlapping the same end user in the market. When we talk about construction, consumer goods and energy and building technology are playing an active role.

Also, mobility solutions and automotive aftermarket sales because you need trucks and excavators to do construction. Every business sector is playing their role in these industries.

When it comes to automotive aftermarket sales, there are other regional competitors. How is Bosch dealing with this?

We recognise the significance of economically priced products and we are also introducing both economical and premium range products. So we are searching the competition with more economically priced products.

We see development and demand for our premium products. So we are addressing both markets. But there will always be cheaper products and different requests from customer.

Construction is currently on the upswing. Bosch’s consumer goods sector is doing well because of this, but are you worried about a slowdown affecting it?

There are always risks in booming countries and there are always cycles in development.

I cannot predict the future. There will be ups and downs, but there is one way it is going now and it is going up.

And this is supported by examples of neighbouring countries, which were in the same situation 10 to 20 years ago.

The office or condo space in Cambodia compared to Vietnam is growing in a similar direction. So we believe that the growth is not at the end .

Maybe there will be a year or two of slowing down and will give the market a rest moment but after that it [growth] will continue.

This development is attracting new foreign investment and interest from neighbouring countries to live and have apartments here. So it’s a positive future in my eyes.

Do you see mining as a driver for Bosch’s industrial technology sector?

On the mining side, it is currently not so rosy. It is under pressure as we speak. But mining is also a long term investment and I do believe it will go up.

You do not open and close a mine like you do with a shop. But we see good opportunities in the increase of manufacturing because we also provide factory automation solutions.

We see opportunity in cement factories and power plants. So, not only mining. At this moment, we are exploring the market. Soon we will see how much potential they have.

We believe that there is potential in a growing market like Cambodia.

How would you compare the Cambodian market to Vietnam and Thailand?

Cambodia is an interesting market. Some of the neighbouring countries have an edge, especially in consumer goods. On the other hand, I think that Cambodia is in a catching-up phase.

This means that we are seeing a lot of initial investment and interest and we are here from the beginning. So we can be a partner from the beginning. I think this is a positive thing.

In some of the neighbouring countries, we might have come in a little later. The good thing about this region is that although diverse, they follow a similar path of development.

We know what happened in Thailand and Vietnam. And we believe that what we expect to come is coming in a similar way.

This article was edited for length and clarity.

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