Off the Beaten Track i

By : cnugraha | on 11:28 AM December 20, 2018
Category : Companies to Watch

Although his family has a long history in the automotive trade, Joe Frans remains well-grounded at the helm of Maxindo Moto, the official importer and distributor of BMW motorcycles in Indonesia. While most people would be satisfied with the type of success he has experienced in automotive sales over the years, it is not enough for Joe, who confessed to GlobeAsia's Elsid Arendra recently that running the business has become somewhat of a hobby.

Maxindo Moto has been selling BMW motorcycles in Indonesia since 2015, and Joe believes the business has a good future. "BMW has a long automotive history, and we have long been associated with BMW as we have also been selling BMW and Mini cars until today," Joe said.

Passion for Business

"This business is almost like a hobby, and indeed this is a hobby business. A passion business. People don't come here to buy a motorcycle for general or daily use, or a car for their everyday needs. Our customer don't come here for their daily transportation needs," he said. "They come here after all their basic needs have been fulfilled; they come here for a passion and because they are really fanatical about the brand. That is where the adrenaline is."

Joe has a long record as a successful car dealer in Pluit, North Jakarta, having won Chevrolet's dealer of the year award three times. But he does not allow this to go to his head.

"We have two companies here in one building; one is the main distributor or importer, and the other is a dealership. The business itself is slightly different from selling cars. We deal with customers who are passionate about motorcycles. Some may say it's an automotive business, but selling a premium motorcycle presents its own challenges," Joe said.

"I don't want to get caught between business and hobby. If I get too deep into this business as a hobby, how will I make a profit?" he said.

He added that the character of the business is like that of the product.

"The character associated with BMW motorbikes is one of adventure. The GS series is closely associated with this German-made motorbike," Joe said. "BMW Motorrad is closely associated with adventure motorcycles with the initials GS, which refer to either Gelände/Strasse or Gelände Sport in German, meaning off-road/on-road or dual-purpose motorcycles."

For the GS, it all began in 1980, when BMW Motorrad presented the world's first large dual-sport motorcycle in the south of France with the R 80 G/S. Since then, the manufacturer has been setting the benchmark in this segment. And it has constantly been writing success stories. The GS series is equipped with a comfortable high suspension to negotiate various types of terrain. BMW has gone a step further in chassis construction with the patented Telelever front suspension. The system separates the two functions of wheel guidance and dampening, or suspension, in a simple, yet effective manner, thus significantly improving ride comfort.

"The story doesn't end there; BMW motorcycles are equipped with electronic riding mode adjustment programs, so even a novice rider will look skilled. But for the expert rider, the various features embedded in a BMW motorbike will take them further and encourage them to do more," Joe said.

The bike's performance is superior. And the same goes for rider safety, which received tons of attention from BMW's engineers. One of the safety features is auto-leveling, to regulate the stability of the motorcycle in an accident so the seat is flattened, preventing the rider from tumbling forward.

"This feature prevents a rider from being thrown forward, or avoids the rider's head from hitting the windshield, or the rider's chest from hitting the handlebars. I have seen several accidents involving BMW motorcycles and none of the riders were seriously injured. This means safety is the main concern for the engineers at BMW Motorrad," said Joe, who is a self-confessed photography enthusiast.

At BMW Motorrad, anticipation is key to keep a rider as safe as possible. Equipped with the latest features and technology, it is therefore no wonder that the selling price of a top-of-the-line BMW motorcycle equals that of a luxury car. Joe said prices in Indonesia are further heavily influenced by the government's luxury goods tax, which means motorcycles can cost up to three times more than the basic price.

"So the biggest price component is tax, not the price of the motorbike itself," Joe said.

Small but Growing

Although classified as luxury items, sales of BMW motorcycles have steadily increased over the years.

"The BMW Motorrad brand has a very strong presence in Indonesia. The products are remarkable, and BMW motorcycles have deep roots in the Indonesian market. Many of our clients are buying with passion and fanaticism. Especially those over 40, who have long known the BMW Motorrad brand," he said.

"The BMW Group's motorcycle division is not that large because it is considered a narrow market. Unlike BMW's cars, the two-wheelers are generally not something purchased by first-time buyers or young people. They will put a car first. A man will usually only buy a premium motorbike when everything else is already well-established," Joe said.

"While BMW's motorcycle division is relatively small, sales of BMW motorcycles have increased rapidly over the past three to four years. I heard production of BMW motorcycles reached 164,000 units, while in previous years, they never exceeded 150,000 units per year. With increased sales, the production of BMW motorcycles is now heading for 200,000 units per year. This makes BMW Motorrad the biggest premium motorcycle brand in Europe," Joe said.

This makes BMW Motorrad the second-largest premium motorcycle brand in the world after Harley Davidson. Although its contribution is not as big as the luxury automaker's four-wheeled division, its management still provides a large portion of technology development, research and development. BMW motorcycles are equipped with various safety and comfort features, including hand-grip heaters, various types of riding modes, ABS and traction control.

Distribution Rights

Looking back to the time Maxindo Moto took over the distribution rights of BMW Motorrad in Indonesia from Duncan MacRae, Joe said his company was familiar with the BMW Motorrad brand because the Nusantara Group had long been a distributor of BMW and Mini cars.

MacRae, who was interviewed by GlobeAsia in 2014, decided to hand the distribution rights to Maxindo Moto so he could focus on his business interests in Europe.

"Our sales volume quadrupled in the second year, despite a sharp increase in the luxury tax rate," Joe said.

Maxindo Moto has also seen steady revenue growth since taking over the BMW Motorrad distribution rights for Indonesia.

"Our sales are mostly supported by the GS series, especially the BMW R 1200 GS Adventure, while in second place, it is the entry-level G 310, which is the top seller, but the profit margin is rather small. In third place is the BMW R nineT," Joe said.

Joe remains confident of Maxindo Moto's future, despite uncertainty due to the upcoming presidential and legislative elections.