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INDUSTRY NEWS

AutoForum - November / December 2018 of goodwill or business value and transformation in the sector. Mbatha described the differences between high

Focus was then directed to the Petroleum Industry with

and low-density sites, equating the local stations of Mbare

Ronand Bescoe, MD Total Zimbabwe, addressing the

and Borrowdale and concluded that fuel retailers will need

major challenges in this sector. In terms of supply, the

to join forces for a better margin.

oil companies facing hard currency shortages added to limited credit facilities, have led to the current situation

The final day of congress facilitated by MIAZ immediate

with no buffer in the system, which is causing panic

past president, Luckson Gwara, opened with a master

buying and in turn forcing an increase in the market price.

class presentation on the auto technician’s toolbox in the

The fluctuating ethanol blending ratio in conjunction with

21st century from Wayne McLean of Highveld Garage

challenging logistics and additional costs, combined with

Equipment, based in Pretoria. McLean focused on modern

an increase in licensed fuel importers (40 in 2016 to 57

technology and the equipment and training required to

in 2017) are some of the factors affecting the suppliers.

cope with it. He explained to the delegates how a lot of

Bescoe commented on the commercial challenges facing

the equipment should not only be charged out on the flat

the sector, saying: “This is a capital intensive industry.

rates based on time, which modern equipment reduces

Maintenance costs are not sustainable with high inflation

through efficiency, but also the expertise required in

and the requirement to import spare parts. There is a need

analysis, which could increase the profitability of the shop.

to review the wholesale and dealer margins. Dealers are currently trying to operate on a margin of 6 cents/litre. “

Delegates were then introduced to Andre Froneman of Hurricane Equipment, who captured their attention with some of the emerging technologies in collision repair. Froneman’s presentation resulted in his being asked to provide demonstrations on plastic repair and quick dent repair, after the official close of the congress, using some of the equipment he brought to the congress. Froneman was inundated with requests to purchase this equipment, but due to the import restrictions imposed by customs, he had to unfortunately decline these offers with a promise to provide quotes to the interested parties. The collision repair theme continued with an enlightening presentation on auto refinish technologies and trends, from Paul Rathbone of BASF Coatings Services. He covered the various solvent and water-borne paint technologies and continued into Basf’s Reflow technology

On the regulatory front, there has been an increase of

in their clear coats and UV curing. Rathbone introduced

licensed retail sites from 229 in 2012 to 540 at the end

the company’s Ratio concept Plus – a professional

of 2017and a change in specifications from RON95 to

consultancy offer to increase efficiency and develop new

RON 93 are expected to drive costs higher in the current

and profitable business areas. Rathbone concluded with a

market. He reiterated his comment that the hard currency

vision of the body shop of the future.

shortage is exacerbated by increasing market price and that the same US$ brings far less molecules into the retail

The final presenter was Brains Muchemwa, MD of

pump.

Outlink Capital, who titled his presentation “Zimbabwe – Economic outlook 2019”. He raised the questions of the

Another of the South African contingent, Sbonelo

bond note and its cousins – RTGS, whether it would be

Mbatha, a multi fuel retail franchisee and co-founder of

phased out early in 2019 and if adopting the Rand is the

PetroCONNECT SA, responded with a presentation on the

best way forward? After analysing the economic data,

challenges faced by the SA Petroleum Industry. Mbatha

Muchemwa summarised by stating that Zimbabwe was

addressed the current outlook of the fuel retail sector in

officially in moderate-to high inflation territory and that

SA today and differentiated between the categories of

the country required policy consistency, and a return to

service stations. He spoke passionately on the subject

normalcy with the Reserve Bank of Zimbabwe’s role in the

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