Financing ambitious objectives
As part of the Group’s expansion strategy, PT Eurokars Motor Indonesia (PT EMI) was established in 2016 to take over the Mazda distributorship business from PT Mazda Motor Indonesia (PT MMI, part of Mazda Corporation Group Japan) in 2017. Mazda’s distribution network of dealerships was officially transferred from PT MMI to PT EMI in 2017.
Because of the takeover, PT EMI would become the sole distributor of Mazda cars in Indonesia and the company laid out an aspirational business plan to grow the brand in the country, bringing in new models and increasing sales volume within the next three years.
To execute its business plan, PT EMI required working capital support not only for itself but also its strategic distributors. Therefore it required:
- A commercial bank with appropriate credit assessment and appetite to customise a suitable facility structure, limit and tenor to ensure sufficient working capital through the supply chain from PT EMI to its dealers, until collection of sales proceeds from end buyers.
- Smooth and quick onboarding of PT EMI’s dealers on programme approach.
- A strong regional trade bank with in-depth local business/regulatory and automobile industry knowledge, which provides an option to replicate a successful model to its other markets.
PT EMI approached UOB in Singapore and Indonesia at the end of 2016 to provide an end-to-end trade and supply chain financing solution. The solution it wanted would see PT EMI as an anchor and PT EMI’s dealers as spokes.
Speed was of the essence in organising this combined financing package and in enabling a seamless takeover and re-launch of the Mazda distributorship under PT EMI’s leadership. UOB was able to successfully integrate all counterparties’ working capital requirements and to process multiple credit processes concurrently while keeping the workflow coordinated and transparent to the anchor and spokes.