Mr Eddie Loo, 46, owner of Car Times, a used and new-car dealership. Married with three kids, the ex-car salesman started his own business in 2001 with a paid-up capital of just $200,000. Today, it has 16 showrooms in five locations and employs 93 workers. Sales are about $150 million a year.
He was named Entrepreneur Of The Year by the Association of Small and Medium Enterprises in 2005, while his company entered the Singapore Book Of Records in 2007 for having the largest chain of pre-owned car showrooms here.
'Since September last year, our used car business has dropped by about 20 per cent, while our new car division - which usually sees a spike during the year-end to Chinese New Year period - has been holding steady.
The number of car owners is still quite substantial but people are more cautious about buying due to the recession.
Used-car sales previously made up 70 per cent of our business, but now it's 50-50. The problem with used cars is the lack of supply. I had up to 200 cars in better times, but now I have only 40. It's the lowest stock I've ever had.
Prices of new cars have dropped and so have used car prices. But can a car owner sell his car at such low prices? He probably may not be able to cover his outstanding loan because he bought it at a higher price. So if no one is selling his car, I can't sell too.
When 9/11 and the Sars epidemic hit in 2001, our business was affected but we pulled through. I went into buying cars because no one else was buying, so I could get very good prices.
I was then able to push the prices of my cars down and make fast turnovers. So I believe that when there's a crisis, there's also an opportunity.
I think the market will still be buoyant as the car industry tends to support itself. People will still want to buy cars.
Prices of new cars are already at their lowest because the car cost is fixed and COE (Certificate of Entitlement) is low.
This is the best time for people to buy. It also makes sense for current car owners to change to a new car because, with the rebates and body price from scrapping their car, they can have a new one for about the same amount they are paying now.
Those who don't want to spend so much can buy used cars, at a few thousand dollars above the scrap value, so there's not much risk. In this way, the system here keeps the market going.
But when the leases on three of my showrooms at West Coast, Leng Kee and Automobile Megamart in Ubi are up in March, I will not renew them. Monthly overheads are between $200,000 and $300,000 and by cutting down the showrooms, I can save about $100,000.
I'll be more careful in purchasing and get cars with a faster turnaround so I won't have to hold stock for too long. I'm also training staff, while at the same time hiring more capable salespeople.
Frankie Chee
This article was first published in The Straits Times on Feb 8, 2009.
