You possibly can’t beat going via an interview transcript to rapidly verify any given interviewee’s favorite adjective or phrase.
For HR Owen’s CEO Ken Choo it’s positively “different” and “very different”. Choo chooses these phrases variously to explain the group’s spectacular 5.3-acre website in Hatfield, 20 miles north of London, which sells Bentley, Ferrari, Lamborghini, Lotus and Maserati, whereas servicing many extra; or how his staff handles high-end buyer relationships, by as an example placing on go-karting nights moderately than formal showroom dinners for Bugatti purchasers; and even to contextualise the way in which the Chinese language authorities offers with EV uptake in its nation, versus the UK Authorities’s tribulations with the present trajectory of the Zero Emission Mandate.
The 51-year-old, Malaysian-born CEO may need just some extra gray hairs than final time we met – on the glitzy summer time 2019 opening of the Group’s Ferrari franchise in Berkeley Sq. in central London – however now he appears extra assured in his function. Again then he was lower than two years into the job and a person of few phrases, regardless of already seeing profits-before-tax leap from £1.6m in 2015/16 to £8.3m in 2018/19 below his watch.
Sitting down for this unique Motor Dealer interview, simply earlier than Christmas in late December 2024, inside his sensible, however removed from flamboyant workplace – someplace he admits he doesn’t spend a lot time as he prefers to be extra hands-on – his trade information has grown significantly. The accountancy, auditing and on line casino hospitality expertise gained within the Far East that helped him get employed nonetheless little doubt turns out to be useful within the day-to-day operating of the HR Owen enterprise – plus Cardiff Metropolis Soccer Membership the place he’s additionally CEO – and each are owned by Vincent Tan, founding father of mum or dad firm Berjaya Group. However his ‘car game’ is now on a usefully elevated stage.
He smiles a figuring out smile exhibiting me around the backroom areas of the gleaming Hatfield website the place a brand-new Ferrari nestles. “I think that’s my car” he quips, earlier than contemplating the relative design deserves of the elegant Cilindri versus the brutal F80. However whereas Choo may cope with the rarefied world of the ultra-high web value particular person, his ‘daily drivers’ are pragmatic, though nonetheless far more thought of than the Toyota Corolla SE his father purchased for him at age 18 and which he saved for 25 years. “These days I’m using a BMW i5 M60 for my shorter commutes and when travelling to Cardiff City FC, it’s a Mercedes S-Class. For long distance I use an engine car, in the city I use an electric car.” Equally, he’s properly conscious of the significance of heritage at a model like Lotus – “they started small, nimble and simple” – but additionally admires the current funding from the Chinese language Geely Group into the British sporting model. “I spoke to their group CEO Mr Feng and think they have a good future.” With HR Owen’s Rolls-Royce London and Lamborghini Manchester operations each successful their respective marque’s world vendor of the yr award in 2023, Choo’s clearly doing one thing proper on the carmaker facet of buyer relations too. “We talk to them very often and tell them where the market is steering,” he says. “All the manufacturers come here.”
However the strictly ‘numbers man’ facet of Choo is aware of 2024 hasn’t been straightforward. Within the yr to thirtieth June 2024, pre-tax earnings fell to £2.29m in comparison with £7.6m final time, on turnover down 1.8% to £556.6m. “It’s been a challenging 12 months,” he concedes firstly of our face-to-face chat. “The market is consolidating and throughout the world in this sector, but the UK is very resilient. HR Owen will continue to invest in the UK and our customers. If you look at the data I think this ‘blip’ is going to be for a while, but I think the UK will come back strong.”
Manufacturers represented by HR Owen cowl the cream of worldwide luxurious automotive marques: Aston Martin, BAC, Bentley, Bugatti, Czinger, Ferrari, Hennessey, Lamborghini, Lotus, Maserati, Rimac and Rolls-Royce, plus one other model imminent. However are such rarefied manufacturers tough to promote in such robust financial moments, even when clients with the type of spare money required to purchase a Bugatti or Bentley are more likely to be much less affected? “There’s still a lot of money out there, but people are now a bit more selective,” he says. “We have clients coming to us for really specific pieces rather than just all-new cars. When the market is bubbly, people buy whatever comes, because money is ‘cheap’. Now, when the cost of funds is more expensive, people think twice, it’s natural. If you have gone on an up cycle for the last 10 years and have never been on a down cycle, you don’t have that experience. But HR Owen has been in this business for a long time.”
Choo factors to the way in which HR Owen invested through the COVID pandemic as a very good instance of its ‘long game’ mission. “The Hatfield dealership was a £55 million development when we had ‘locked down’ for two years, as well making a lot of other investments when times were tough. Now, in the last few months, we see the opportunities.” When it comes to product focus throughout the already elite world of luxurious vehicles, restricted version hypercars are an space of curiosity, “number one,” he says, “because they are growing and also because they have interesting products coming up and they’re very niche and special.”
Liaison with this various buyer base wants a tailor-made strategy too. “Even within Ferrari, a ‘limited edition’ sort of person with crazy wealth, is different to somebody who just saved up for a 296 by selling a company or something,” he causes. “The way we manage different sets of clients is very different. We took a small number to see the new Ferrari F80 launch in the factory. That was special. Many customers want more engagement but not all. Some want us to leave them alone. It’s a fine balance.”
Examples of such numerous actions embrace the inaugural ‘Supercar Sunday’ occasion held in Could 2024 on the Hatfield dealership, the place virtually 800 folks attended, to a a lot smaller gathering proper by the Thames River for the Lamborghini Revuelto, the place the brand new mannequin itself dramatically arrived by barge. HR Owen additionally fosters relationships with non-car manufacturers. “We do a lot of cross-marketing,” Choo confirms. “Some of our customers love Dior or Chanel so they’re not just coming into [London] to buy a car, they’re looking at everything else. We just did an event at Dior where we closed the shop and had a one-to-one personal shopping session for special pieces. Dior hosts our customers and brings its customers to us when we have events.”
When it comes to benchmarking, Choo doesn’t a lot look to different automotive sellers or manufacturers, preferring to namecheck the small, unique and storied Swiss watchmaker Patek Philippe (beloved of Queen Victoria amongst others) moderately than the bigger-selling Rolex model. “There’s no other dealer operating as much in central London and at this category of luxury than us,” he says. “We can’t really benchmark against another car dealership, most of which are volume-driven. We are one tenth the size of a lot of motor dealers in the UK and not even ‘Top Ten’ in terms of size. But we don’t want to be huge. That’s not the game plan.”
Slightly, the technique entails progress in some areas, particularly enlargement in central London (which Choo can’t fairly give full particulars about now), plus consolidation and upgrades in others, comparable to Ferrari and different manufacturers’ servicing departments moved below one roof to Hatfield, with older websites together with Premier Park close to Park Royal, north-west London closed. Excessive-end automotive storage is one other space Choo is eager to discover. “We have 10,000 customers but zero car storage facilities,” he says. “But we will not go into it massively, just for selected customers, because most wealthy customers have hundreds of acres of land. But some international customers might want to leave their car here and then have us truck it to them, rather than keep it in a barn or somewhere, because our service bays are all here. It’s like a Harrods storage facility.”
Again to the figures, Choo is evident why they’re inferior to some earlier years. “Our profit-before-tax numbers [in 2024] were low mainly because of two major items: high depreciation because we bought a lot of properties, while high interest rates mean the cost of finance is really high. But we are trying to manage that. It’s tough, but we’ll prevail.” He’s additionally constructive concerning the wider outlook: “Compared to six years ago, our net asset position today is in a very different spectrum. We have now acquired more than nine properties. We are doing two more acquisitions now. Our net asset position the last time we spoke, was maybe £20 million and now we are about £70-80 million.”
201224 Motor Dealer. KEN CHOO CEO HR OWEN
And what of the broader and longer-term world multi-government strikes in direction of electrification and its potential financial influence on the at the moment wobbly EV market and combustion engine-heavy new luxurious and hypercar market and their future used values? “I think in the long term it will evolve,” he says calmly. “Even [EV expert and Rimac founder] Mate Rimac has talked about sooner or later if there’s an engine within the automotive, it’s going to be a hybrid. I believe pure EVs will nonetheless be related, however perhaps at a smaller proportion than folks count on. We aren’t China. The federal government technique there may be very completely different to the federal government technique in numerous elements of the world. Or take a look at Lotus, that they had an electrical automotive [strategy] and now they’ve introduced a hybrid. It relies on how fast you might be as a producer, respective of whether or not you’re in Germany, Italy or China, how fast you may steer when demand begins to alter.
“I think customers will always love track days and the driving experience. There’s nothing wrong with an ‘engine car’. The only issue is carbon emissions. So if they fix the fuel problem that should solve the problem. The [invention of the] Apple watch hasn’t meant throwing away mechanical watches. We don’t think the electrification thing is going to move as quickly as people expect, but all our new properties are wired for the next 10-20 years. We can pull a point from the ground and have more fast-charging capability. And when in the UK you can’t sell [new] combustion engine cars anymore, I think the value [of old ones] is just going to go up. Imagine if you have those cars which you can’t get anywhere else in the world?”
Whichever approach client demand and authorities laws strikes, Choo appears settled – he lives in leafy Chiswick, in West London – and is comfortable to see how the market performs out. “I’ve been in the UK for 10 years now. I got married here, had a kid here – my daughter is now four and a half – and it’s a lovely place,” he says relaxed and with a smile. “We wish to make HR Owen higher and higher by taking small steps yearly. We aren’t attempting to develop the corporate in a approach you may’t handle. We wish natural progress, put money into companies and property property via the earnings we make
