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  • Impressions of Singapore, the second biggest Saab market in the Asia Pacific region

    Saab is currently building a resurgence in the Asia Pacific region. When General Motors was planning to close Saab in late 2009, several markets were abandoned, such as Australia and New Zealand. During those uncertain days, Saabs continued to be sold in Singapore. It may be a surprise to some that Singapore became the second largest Saab market the Asia Pacific region, surpassed only by the Republic of China on Taiwan. There are plans for increased sales in the People's Republic of China, Australia, and Japan, all of which are much larger than the Singaporean market and will eventually displace Singapore as the number two Saab market in the Asia Pacific region.

    Singapore River with the Fullerton Hotel (former General Post Office building) in the background and the Esplanade (fruit shaped building)

    Trans Eurokars Pte Ltd. is the authorized Saab importer to Singapore (the local terminology is authorised distributor). Every market has its idiosyncrasies and Singapore is no exception. Jeffrey Cheong, Sales Manager and Communications Manager for Saab at Trans Eurokars was kind enough to answers some questions. He, along with some others at Trans Eurokars and a few Saab owners in Singapore, provide a fascinating insight into Saabs in Singapore.

    Singapore has been referred to affectionately, at least in recent years, as “the little red dot”. About 5 million people live in the island country. Most Singaporeans are of Chinese descent, with significant number of ethnic Malays, Tamils and other Indians, and expatriates, including those from Western countries. Singapore is consistently at the very top of rankings for the absence of corruption. In the Asia Pacific region, Singapore exceeds Japan and rivals Australia and Canada in per capita gross domestic product. Bert and Catharina Öhman, who drove a Saab a few years ago from Sweden to southeast Asia via India and back via China and Russia, remarked of Singapore “people drive carefully and they actually stop at pedestrian crossings. The air is clean and there are no bad smells… It feels like we have entered another planet.”

    SaabWorld (SW): When did Saab cars first appear in Singapore?

    Jeffrey Cheong (JC): I believe Saabs were imported by another agent Minerva Auto in the late 80’s but Trans Eurokars started in 1991.

    SW: Minerva now is in the motorcycle business offering a number of brands, including Ducati. How does Saab Automobile AB sell cars in Singapore?

    JC: Trans Eurokars is the official importer and distributor of Saab in Singapore. Our volume does not justify having us appoint dealerships, unlike say Australia. However, we do have 2 showrooms – one in Leng Kee, where the motoring belt is concentrated, and the other at our Head Office in Sungei Kadut. We also have 2 service centres to look after existing Saab owners – one in Sungei Kadut and the other newly opened in Ubi Close, where we also have our Opel servicing centre. Incidentally, Trans Eurokars is part of the Eurokars Group of Companies where we are the importer and sole distributor for Rolls Royce, Porsche, Mini, Saab and Opel. (editor: Leng Kee is not far from the commercial center of Singapore and the historic Alexandra Hospital. Sungei Kadut is about 15 km./10 mi. to the north. Ubi is in eastern Singapore near the Paya Lebar Air Base and close to dealers representing many of the mass market brands, like Toyota and Honda.)

    SW: Do your customers generally buy cars already in your inventory or do most customers order a car to be built?

    JC: Most sales are ex-stock, unless it is a color availability problem. But generally customers do not order a car to be built as the need to get it homologated is a hassle.

    SW: Does Trans Eurokars sell cars to buyers in other countries?

    JC: We used to be in joint-venture with a Malaysian company selling Saabs in Malaysia but due to the difficulties in securing AP (approved permits) to import cars and high duties making the cars more expensive than locally assembled Mercedes and BMW 5 series, we gave up the business. We have not exported any new Saabs elsewhere, though we would love to, to clear existing old stocks.

    SW: Are there plans to bring the Saab 9-4X to Singapore?

    JC: Yes, we do have quite a huge market for such cars. Current leaders are Lexus/Toyota with their RX series, BMW X3, X5 and Volvo XC90.

    SW: Is there anything you would like to tell the worldwide Saab community?

    JC: We went through a tough time in 2008, 2009 when we heard that GM was selling off Saab. We lost quite a lot of customers who, despite the assurance given out by Trans Eurokars that we guarantee to support and provide parts and aftersales, left the brand. Now that Spyker has bought over Saab, and we just celebrated Saab’s first anniversary as an independent company, we are building up the brand again and trying to recover lost customers.

    Trans Eurokars' Leng Kee showroom

    SW: Trans Eurokars is part of the Eurokars Group of companies, based in Singapore with a presence in Singapore and Jakarta, Indonesia. The Eurokars group of companies has over 400 employees and a turnover in 2007 of over $200 million. In Singapore, the group sells Porsche, Rolls Royce, Saab, MINI, and Opel.

    Trans Eurokars began in 1991 when started as the authorized Saab distributor. By combining the role of importer and dealer, the potential profit margin is higher compared. In the United States, Saab Cars North America is the importer and there are independently owned authorized dealers in various cities.

    In 2001, Trans Eurokars entered into a joint venture with Jaseri Auto, a Malaysian company that had the official Porsche and Saab distribution rights to Malaysia, and then opened the only Saab/Porsche dealership in Malaysia at the time near the Malaysian capital city of Kuala Lumpur. Trans Eurokars subsequently exited the Malaysian market as Jeffrey Cheong stated.

    Unlike the United States, Singapore has a number of gray market dealers, referred to as parallel importers. These firms obtain cars independent of the manufacturer’s distribution chain and sell them at lower prices but with uncertain aftersales support. Parallel importers in Singapore primarily sell Japanese cars and small numbers of Volkwagen, Audi, and Mercedes Benz cars. Mauritius, a country in the Indian Ocean, imported Saabs from mainly from General Motors South Africa until approximately 2008 but did receive some Saabs from Singapore. It is unclear the source of these cars but may have come from parallel importers.

    There is Singaporean involvement in the shipping of Saabs to North America. Wallenius Wilhemsen, a large Swedish-Norwegian shipping company, has several Singapore registered ships in its fleet. Some Wallenius ships are owned and operated by the Singapore Shipping Company and subsidiaries, including the MV Boheme, which transported my current Saab from Sweden to the United States.

    Saab pricing

    Because of the limited size of the Singapore car market, car manufacturers generally have only one authorized dealer. Price competition is largely between competing car models, not between dealers selling the same model. There is some flexibility on price but customers report that special deals on financing is more common, where the dealer can receive commissions from the lending bank. There is also flexibility in adding dealer accessories without additional charges to the customer.

    The latest prices for the Saab 9-3 2.0T $180,888 (€102,111 US$142,803) and the Saab 9-5 V6 XWD Aero is $260,888 (€140,271, US$205,959). The frequency of the number 8 in pricing relates to the number seen as lucky in Chinese. The number 4 is considered unlucky in Chinese, prompting Continental Tires to name its successor to the ContiSportContact 3 tire, the ContiSportContact 5P, skipping the number 4. Buick, which used to have 4 decorative intake ports on the side of the hood, has recently reduced the number to three citing the same reason. I would have advised Saab to name upcoming model the 9-6X rather than the 9-4X but I am optimistic that the 9-4X will do well in Singapore much as the Audi A4 has done. Right hand drive Saab 9-4X models are expected to be available in August, 2011 with sales in Singapore shortly afterwards.

    The high costs of cars in Singapore results in cars viewed as luxury goods. New car showrooms usually have a very modern appearance. In Singapore, the showrooms tend to be near the street and cars displayed indoors rather than the American style where there is a large parking lot of new cars. Some dealers, including Trans Eurokars, have a second showroom in a more industrial area, sometimes behind a high perimeter wall.

    The price of Saabs and other cars can fluctuate because the way cars are licensed in Singapore. There is a quota system requiring buyers to bid on a Certificate of Entitlement (COE). Essentially, there is a monthy quota. For example, there may be 400 COE’s available on a given month and 700 people may be bidding on these. If so, the 400 highest bidders receive their COE paying the amount of the lowest successful bidder. The dealer usually arranges for the COE but individuals bid when renewing their COE. The list price of the car can change depending if the COE changes. The list price usually includes the COE, GST (similar to sales tax), and 6 months of road tax. In contrast, the list price in the United States, called the MSRP or manufacturer’s suggested retail price, is a pre-tax price because different states and cities have varying tax rates and having one national list price aids in advertising. The March COE for cars with greater than 1.6 liter engines is SG$61,894. When the Saab 9-3 replacement comes out with a 1,598 cc turbo, the COE may be around SG$15,000 less, based on the current COE levels.

    The COE usually allows car ownership for 10 years with a pro-rated refund for cars owned for a shorter period of time. After ten years, the car owner may bid for another 10 years or export/scrap the car. Singapore is one of the largest exporters of used cars in the world, trailing only Japan in the right hand drive market. The COE system has resulted in few classic Saab 900 cars in Singapore. However, a black 1989 Saab 900 SPG, formerly owned by the managing director of Minerva Motor, the former Saab importer, is in good condition and still plying the streets of Singapore with a COE good until 2019! The availability of good public transportation and low price of taxis has skewed the marked towards premium cars as marginal buyers choose public transportation.

    weddingcars.sg, used with permission

    The fluctuation in COE, going significantly down in some months, increases the risk of selling used cars. The parent company of Trans Eurokars did not start used car sales until recent years and coincided with the global recession, which reduced new car sales. If the number of COEs are reduced, which will be occurring until July, 2011, this also limits new car sales, increasing the importance of used car sales.

    Besides new car sales, there is a limited market for Saab rental cars. Trans Eurokars offers Saabs for rental. An agency, weddingcars.sg, specializes in the bridal car market and offers several Saabs for rent. The use of Saabs as a bridal car gives insight to the prestige that Saab has in Singapore, though Saab has not reached the level of public awareness achieved by some companies, such as BMW.

    Saab sales and standard equipment in Singapore

    Singapore is a right hand drive market. Many of the controls are reversed compared to left hand drive cars. Exceptions include the hood release, which remains on the left, which would be the passenger side in Singapore. The turn signal stalk also remains on the left side of the steering wheel.

    Drivers in Singapore mostly prefer cars with automatic transmission and Saabs in Singapore are all automatics. One customer noted that it is possible to special order a manual transmission equipped car but is, in practice, rare. Saab cars in Singapore have gasoline powered engines. Diesel models are not sold.

    Trans Eurokars has input in some of the features of the car being the importer. As shown in the figures, the Saab 9-3 in Singapore has rear air conditioning vents and a center rear headrest, compared to Saabs in the United States, which lack a center rear headrest and only recently brought back rear air conditioning vents. An alarm and cup holders, standard in U.S. cars, are optional in many markets, including Singapore. Seat heaters is an option but entirely unnecessary in Singapore given that the record low temperature is 19 degrees C (66 degrees F). A rear view mirror with a digital compass and (Homelink) garage door opener are equipment usually only available in North American Saabs but there is at least one Saab in Singapore with this feature. Tires fitted are also different. Tires suppliers change but at one time, the most basic Saab 9-3 in Singapore had Goodyear Eagle NCT5 tires while American cars had Pirelli P6 Four Seasons tires. Trans Eurokars offers Hirsch engine upgrades on some cars.

    Singapore version with rear center headrests

    U.S. version without rear center headrests

    Saab 9-3 in Singapore equipped with rear air conditioning vents

    Saab 9-3 in the United States with no rear air conditioning vents (since added to the 2011 U.S. version)

    Saab maintenance

    Unlike most national importers, but similar to Saab Cars North America, Trans Eurokars offers free maintenance for Saabs. The duration has varied but has been as long as five years.

    In many countries, some customers choose to have their Saabs serviced by independent mechanics after either the warranty expires or when free maintenance ends. This is no different in Singapore. There are some independent garages with Tech II capacity and work on Saabs. Winston Workshop in Ubi, run by a Swedish expatriate, is mentioned by more than one Saab owner. There are also mechanics who do only mechanical work and not work related to the car electronics.

    Compared to the United States, parts tend to be more expensive but labor charges somewhat less expensive. Singapore is far away from Sweden and, being a small market, does not have a parts depot to service multiple dealers. Trans Eurokars has to stock common parts to avoid delays in repairs, but there have been reports of delays of up to 10 days to obtain rarely used parts. Singaporeans tend to be very well travelled and, to save money, have resorted to buying smaller parts overseas and bringing them back to Singapore either by themselves or by friends. I was asked to bring some Saab parts on a trip to Singapore and was treated to lunch.

    Any complaints about the cost of parts and car ownership should be taken in context, however. Some car costs are lower. For example, the cost of parking is significantly lower in Singapore compared to New York or London. Fuel is more expensive than in the United States but less expensive than in many Western European countries. For example, parking is US$2 per hour or less at the Wisma Atria, a shopping center on Orchard Road with a decent food court, free 1st hour midday at the Plaza Singapura, home of the French owned hypermarket, Carrefour, which has some general car accessories. Shell is currently selling 95 octane unleaded at SG$2.077/liter (US$6.33/gallon, March 17, 2011 price) compared to US$3.999/gallon for mid-grade unleaded at a Shell station in Seattle.

    The tropic climate in Singapore acts on Saabs differently than in some parts of the world. Rusting wheel bolts is a common problem nearly worldwide but is practically unheard of in Singapore. On the other hand, heat is very hard on rubber resulting in early deterioration of the shark's fin roof antenna. All cars, Saab and non-Saab alike, have shorter battery lifespan and premature hardening of tires, compared to more temperate climates.

    Saab sales in Singapore

    Saab sales in Singapore are up after a disasterous dip during the uncertainty of Saab future before the Spyker tie-up. In 2008, Trans Eurokars sold 117 Saab, dropping to 65 in 2009, and only 13 in the first 11 months of 2010. Though Singapore was affected by the global recession, the country has bounced back with double digit economic growth in 2010 leading to the conclusion that the previous uncertainty of Saab’s future was the cause to the drop in sales. The servicing and warranty was assured by Trans Eurokars and Managing Director, Ms. Ong Lay Ling, when Saab was potentially heading toward extinction but Singaporeans are generally well informed and naturally cautious. In addition, many Singaporeans place much importance in a car’s resale value, which would diminish if Saab ended production. With the return of Saab from the brink, 12 Saabs were registered in January, 2011, just one short of the sales figure for the first 11 months of 2010. More new Saabs were registered than Mazdas in January. Singapore is an unusual market as more Porsches are sold than Nissans or Hyundais, consistent with the premium market emphasis previously mentioned. February is a slow month for car sales because of Chinese New Year.

    Past Saab events in Singapore

    Trans Eurokars takes a very active role in promoting Saab, more than typical dealers in other countries. This is fitting as the company is acts as both an importer and a dealer of Saabs. Trans Eurokars has partnered with DBS, a large regional bank, to offer a Saab/DBS co-branded Visa credit card. Several years ago, the Saab Aero X concept car was brought to Singapore for display on the initiative of Trans Eurokars. The company sponsored the 2008 Saab City Duathalon, named that year for Saab because of Trans Eurokars’ sponsorship. Several employees of the dealership, including the managing director and senior management participated in the running. Trans Eurokars also works with companies to sponsor test drive events where food and test drives are provided for corporate receptions. The local Saab club used to meet on Saturdays with food provided by Trans Eurokars. The Saturday meetings no longer take place but there are occasional gatherings, such as a Trans Eurokars' Saab Independence Day gala held on February 23, 2011 on the one year anniversary of the Saab's rebirth.

    Trans Eurokars introduced the new Saab 9-5 with great fanfare to approximately 800 guests, diplomats, and celebrities at a hotel ballroom earlier in 2011, which also marked the first introduction of a new car model in 2011 in Singapore. Nicholas Ferguson of Bite Communications, who is handling public relations in Singapore during introduction of the 9-5 informed SaabWorld, “the new Saab 9-5 marks several firsts, as it is the first 9-5 model to be launched in 13 years, it is the first Saab model to be launched since the brand became independent and it will be the first car launched in Singapore in 2011.” Trans Eurokars has also sponsored launch galas for other models, such as the introduction of the 9-3 Turbo X, whose entire allotment to Singapore was snatched up within one day by local Saab enthusiasts in 2008.

    We are Singapore

    There is a patriotic song in Singapore referring to the early days of independence when Singapore's future was not certain. The lyrics to the song starts with "There was a time when people said That Singapore won't make it, but we did". Likewise, there was a time that people thought Saab would not make it. To that, Singaporeans may understand the phrase, "We are Saab".

    - - - - - - - -
    Jeff Cheong has been in the car business since 1980, initially as a Product Manager for Toyota and a Sales Manager for Mitsubishi. He later worked for Trans Eurokars on two occasions, earlier with Porsche, with an intervening stint with YHI, a Singaporean wheel manufacturer. For the past ten years, he has been with the Saab at Trans Eurokars. Thanks to Mr. Jeffrey Cheong of Trans Eurokars, Nicholas Ferguson of Bite Communications, and several Singaporean Saab drivers.

    Except when indicated, all photos are SaabWorld exclusive photos taken by the author/correspondent.
    This article was originally published in blog: Impressions of Singapore, the second biggest Saab market in the Asia Pacific region started by Dave T
    Comments 3 Comments
    1. nordwulf's Avatar
      nordwulf -
      Very informative article and it must have taken quite some time to research and write.

      And I'll never complain about the price of new cars in the US again.
    1. Dave T's Avatar
      Dave T -
      A few months into 2011, it looks as several countries, such as Japan and Australia, have surpassed Singapore in Saab sales. If those 1,000+ Saabs ordered are delivered to the People's Republic of China, that will far exceed sales in Singapore, Australia, Japan and Taiwan, ROC.
    1. Dave T's Avatar
      Dave T -
      An update: The Leng Kee Road showroom has been converted to a used car showroom. Servicing of Saabs continue at Trans Eurokars. For quite a while, there were unsold Saab stock but all of those cars have been sold. There remains two Saab available for lease, though. In the United States, Bluegrass in Louisville, Kentucky continues to have quite a few unsold 2011 Saab 9-3 cars, many of which were bought at auction of Saabs that were stranded at the port at the time of bankruptcy.
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