What is the value of international perspectives?

The Dutch public transport market has proven to be an interesting market for globally operating public transport companies in recent years. Almost all players are active internationally these days. How do manufacturers and carriers view the Dutch and international public transport market?

This article was previously published in OV-Magazine 1/2022. Would you like to receive OV-Magazine on paper or digitally from now on? Then sign up for a subscription.

Ard Romers, Director of VDL Bus & Coach

Director Ard Romers of VDL Bus & Coach knows better than anyone that the Netherlands is quickly too small for a company. The bus and tour card vision for the Dutch family business VDL Groep is now active in fourteen European countries. “The Netherlands is an interesting country with public transport to do business, we are at the forefront of innovations. But if you want to sell a lot of volume, the Benelux is simply too small. To achieve returns, scale is needed.”

And so companies that want to grow are increasingly active internationally. CEO Alex Rentier from Keolis Nederland believes that this is a logical development. The company, which entered public transport in the late 1990s (then Syntus) as a new player, has since 2012 been part of the French parent group, which operates in fifteen countries. “The Dutch public transport market was previously fragmented and regionally organized. Today, there is an international mother behind every carrier. It is part of a growing market. ”

learn from each other

Alex Hornby from Transdev states that an internationally operating company has more global and specific knowledge. Hornby is the CEO of Harrogate Bus Company in the north of England, a

subsidiary of Transdev Blazefield. The added value is clear, he believes: “We now have eight electric buses, but in the coming years we will expand to 71 buses and completely or partially rebuild three depots. In this we can draw on Dutch knowledge, because Transdev Netherlands already has a lot of experience with this. And in Portugal, engineering is again very efficient, so we can also benefit from it. ”

Rentier knows that the centrally gathered knowledge of an international company can be applied by any national department of an international company to itself. “Keolis Nederland can use the innovation center in France for bus, train and autonomous transport. For example, we have little knowledge of autonomous trains, but Keolis already has contracts with them internationally. If we ever need it, we can always draw on it. Then we do not have to invent everything ourselves ».

Martijn van Beek, Director of Internationalization Vialis: ‘Large companies focus on control and risks. This automatically makes it less flexible ‘

According to Martijn van Beek, Director of Business Development and Internationalization of the VolkerWessels subsidiary Vialis, ‘discovery, innovation and entrepreneurship’ is part of the Dutch DNA. The company develops, manufactures and delivers mobility systems internationally, including railway products, and selects direct deliveries or deliveries through partnerships. “Everything Vialis does must be market-oriented, robust and scalable. The choice of the right partners is obvious: they have knowledge of the country, the culture and the applicable laws and regulations. As a result, Vialis can shorten ‘time to market’ and reduce error costs. This preserves the flexibility to adapt to local requirements, wishes and habits, and customer focus is guaranteed. ”

Ard Romers states that the Dutch bus division of VDL will greatly benefit from international cooperation in standardization and financing structures. “As a bus division, we want to focus on the development of energy storage systems. But the Netherlands has a moderate climate, we have insufficient knowledge of extremes. So we have to acquire that knowledge in other countries, such as Norway or Spain. ” Van Beek indicates that challenges are solved pragmatically in the Netherlands, partly due to the relatively small scale. “The Netherlands has an open culture and we speak our language. For example, Germany is better known for its solidity and has a larger scale. If you combine and exchange these cultures and expertise, you can take customer questions to an even higher level.”

Ard Romers, Director of VDL Bus & Coach: ‘If you want to sell a lot of volume, the Benelux is too small’

Conversely, international mothers can also learn a lot from their local daughters. What can Alex Hornby bring to the global company Transdev? “In England, the basic principle is that we are the retailer that sells a product. Because of the privatized English system, that mindset makes sense here. And it works – Route 36 to Leeds grew by 21 percent since 2016, when we accelerated the route for ten minutes, changing equipment, using recognizable brand colors. In other countries, people look jealous of this premium bus. And thanks to our marketing and acquisitions, 85 percent of travelers have already returned since the corona crisis broke out. ”

Keolis Group can learn a lot from the Dutch experience with ‘the world’s largest zero-emission fleet’ in IJssel-Vecht, continues Alex Rentier. Without wishing to elaborate on the Chinese BYD buses, the Dutch department has learned a lot about detours, loading times and electric operation. “If Keolis branches in other countries want to electrify, we can fly in staff to support them.”

Bureaucracy or coordination

A common argument about large companies is that they operate bureaucratically. “The bigger a company is, the less they are perceived as agile,” Van Beek begins. “Large companies are more focused on control and risks than start-ups. This makes it less flexible. If a company is to establish itself internationally, it must know the national rules, and this requires extra control and coordination. That is why Vialis chooses a partner structure: Our partners have more specific knowledge about a country, so you can manage risks. ”

Although VDL Bus & Coach has branches in many European countries, Ard Romers experiences coordination rather than bureaucracy. “Each public transport country has its own characteristics, and therefore input from a local department is important. VDL is a family business and wants to remain a flat organization. Of course you have to make key agreements on standardization, but I do not have to decide how the Italian department works. ”

Alex Hornby, CEO Transdev Blazefield: ‘Ov is a locally oriented product. Our success stands or falls with a local approach ‘

Hornby is also experiencing some bureaucracy in the north of England, but notes that this is not the case with all public transport companies. “Some competitors will behave like big business. Then you lose contact with the customer. Our travelers still know us as Harrogate Bus Company, and Transdev depends on our local decisions. Public transportation is largely a product for travelers with local “Of course, certain processes, especially in the back office, are standardized in Transdev, but we have a lot of our own decision-making power. I’m happy about that, because it depends on our success.”

Alex Hornby, CEO of Harrogate Bus Company in the north of England

“Every international business has a different degree of rigidity,” continues Alex Rentier. “I have worked in Dubai and Germany, among other places, and I can say: companies work really flexibly in Dutch public transport. Compare that to McDonald’s, where Americans prescribe how to bake a hamburger. Our mother follows our development closely, but it is up to us what we do. ”

You will not get rich here

And how do shareholders view it? Recently, the Keolis director warned in this magazine that foreign shareholders were in danger of leaving the Netherlands if there is no prospect of a healthy return in the long run. A call that former Transdev director Pier Eringa also made earlier. Rentier now says: “Shareholders simply want to achieve a return. So in the event of a structural loss, the choice is quickly made. ”

Alex Rentier, CEO Keolis Nederland: ‘If shareholders want to get rich, they should not invest in public transport’

But maybe the soup is eaten a little hotter than it is served. “In Dubai, the airline Serco stopped bidding because it did not get enough returns. In the Netherlands, you often have to invest in equipment yourself and then risks and returns are higher. But if shareholders want to get rich quick, they do not have to invest in public transport. : investments in public transport only pay off in the long run. ”

Alex Rentier, CEO of Keolis Holland

In addition, the shareholders also have a long-term vision, says Alex Hornby from Northern England. “Transdev is supported in the long-term investments by two shareholders. The Rethmann Group bought 35 percent of the shares in 2019, feels a strong bond with the bus company and seeks cooperation. As mentioned, we are a dealer, so we also try to make money together. In England “Under covid, airlines received state compensation for lost revenue but were not allowed to make money. At a low point, we still saw 9 percent of our travelers, we are now at more than 85 percent.”

Boundaries disappear

Where carriers saw their passengers leave under the corona, manufacturers saw fewer ‘withdrawal movements’. Romers: “The bus sector in particular came to a standstill and many tenders and investments were postponed, but Dutch public transport operators continued to invest in new buses. And VDL has also continued to innovate, so we are ready for the future as soon as we can. “Deliveries also continued as usual at Vialis,” says Van Beek. “One of our larger customers is ProRail, we primarily supply ‘rail’ components for the infrastructure in the long term.”

The only problem, Romers sees, is that the availability of materials has proven to be low. “We are dependent on suppliers outside Europe and experienced the disadvantages of this during the corona: in the beginning we were completely dependent on Asia for face masks. I would like to see a European supply policy where we think on equal terms, where we are not dependent on remote locations . ”

Ard Romers: ‘I would like a European procurement policy where we are not dependent on distant places’

Martijn van Beek also experiences these challenges in the supply chain, but he calls it business as usual. “The lack of certain components is not new, such as the problems in the chip industry. In a well-organized supply chain, one must be able to anticipate new developments. We also see a shortage in the labor market. But in a ‘connected’ world, where a lot of telework is now being done, partly because of covid, international borders are being blurred. For example, many IT professionals have moved to Spain to live and work. The question is where the balance lies. Ultimately, doing business also means giving each other something and seeing each other. Like Vialis, we are looking at how we can organize this labor shortage with our partners via hybrid models (on / offshore).

Rentier sees this exchange of knowledge of staff as a great added value in his company: “We now have a French colleague in the Benelux. We can make use of his knowledge and network and vice versa. In my opinion, this exchange of knowledge should be more frequent. When entering new markets, the exchange of knowledge is of great value.

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