INTERVIEW / FRANCISCO ORDONEZ

Just don't mention GM!

While he seems a tad sensitive about a certain past affiliation, the president of DPSS is upbeat about this region's aftermarket potential

ALFRED THA HLA

The suave, film-star looks of Francisco Ordonez may play a role in the aura of leadership he exudes; the man certainly looks like he's onto a winner. And he's on the brink of making history in Thailand's automotive industry as Delphi Product & Service Solutions (DPSS) debuts in the lucrative aftermarket segment.

This is Delphi's first foray into the field. It started out in the Kingdom about 11 years back as an original-equipment-manufacturer (OEM) direct supplier to car-makers, before setting up a manufacturing plant in Rayong in 2001.

According to Delphi, the aftermarket segment - ignition cables and coils, sensors, car audio, portable navigation, DVD players, brake pads and radiators - is already comparable in size to the OEM market.

As president of DPSS, formerly known as Delphi Aftermarket Operations, Ordonez is responsible for the firm's worldwide business in original equipment service, automotive aftermarket, consumer electronics and diagnostic systems. Concurrently a vice-president at Delphi Corporation, he is also on the Delphi Strategy Board, its top, policy-making body.

Right from the start of the interview he set the record straight, distancing himself from General Motors - in a nice way, though. This was in response to a question of mine about whether Delphi wasn't, in fact, a subsidiary of General Motors.

"For a hundred years Delphi was part of GM. [But now] there is no relationship. It [Delphi] is an independent company. It has taken a while to shed the image.

"I'm from GM. I spent most of my career with GM, but I have became a part of Delphi and it's going to take a while for people to understand that Delphi is not a GM company. We have this problem in the US and everywhere else."

GM constitutes less than 40% of Delphi's orders at the moment, he said, and that percentage will be further reduced, to a third or so, when business from new customers, already signed up by the firm, comes on stream.

"About 60 to 70% of our business is with Toyota, BMW, Mercedes-Benz, Hyundai, Volkswagen, Chery and other Chinese manufacturers. Delphi is no longer a GM company. We're proud of our GM relationship but we're not a GM company," he declared, as key lieutenants sitting next to him concur with subtle grunts and nods of the head.

DPSS will be represented in Thailand through TAC, also known as TRW Asiatic, a joint venture between TRW Automotive Aftermarket and Automotive Asiatic Company.

In essence, DPSS will distribute, via TAC, a series of Delphi-branded parts to car owners through a network of 2,000 dealers and shops around Thailand.

While stopping short of embarking on a large-scale investment scheme here, DPSS' appointment of a distributor is still viewed as a commitment to the domestic auto industry, a response to the growth potential of the aftermarket segment and, quite possibly, of the Ecocar project, too."The US$14 million Delphi plant is what we have, in fact, done, but what we will do in the future is to follow the OEM market as it grows and, as we win business, we will continue to invest in Thailand."

DPSS views its current strategy with regard to the aftermarket as an investment in brand development, local presence, marketing, sales employment and warehouse logistics.

"Delphi, as a corporation, is very committed to all of Southeast Asia. We have facilities in Indonesia, Malaysia, Thailand and Korea. We are still in the early stages of the development of our involvement in Thailand."

So why now?

Ordonez explained that, as part of GM 10 years back, Delphi didn't have an aftermarket. More recently, however, the firm felt that it couldn't afford to overlook the potential of the Asia-Pacific region.

"We have matured. Last October we established a unit in Malaysia. Thailand is the second in the Asean region. Again, we're not a GM company and it could take a while to find that out, but of course [the memory of] our past relationship with GM is [still strong] in people's minds."

Delphi is determined to be a global company but one with a local flavour in whichever part of the world it decides to spread its wings. For, as the Cuban-born Ordonez puts it, "not everything happens out of the United States.

"Delphi has five operating divisions [powertrain in Europe, electronics in Southeast Asia and China, a new joint venture in Seoul] that have moved its business around globally."

He paused before shifting the conversation back to Thailand.

"We believe our business should be run by Thai people. It's a competitive advantage to have everything localised, as you can see from our three global manufacturing bases and 150 facilities around the world.

"As Southeast Asia's second-biggest economy, Thailand represents a very exciting opportunity for us. We are confident that we will be able to gain shares in the growing automotive aftermarket segment in this country, a market that is demanding high-quality parts."

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10 questions for Ordonez

- What's your favourite car?

Unfortunately, it's the 1965 Ford Mustang sports car with three-speed and 289 high-performance engine that came out in the early '60s. I'm a product of the early '60s myself, you see!

- Favourite timepiece?

Rolex Submariner.

- Favourite movie?

I like the big-production movies. I always enjoy Ben Hur [1959, starring Charlton Heston] and Sound of Music [1965, Julie Andrews]. I loved Titanic [1997, Leonardo DiCaprio and Kate Winslet]. I get intrigued by technology ... how they make a movie.

- Favourite athlete?

Former Miami Dolphins head coach Don Shula. He's the 'winningest' NFL coach [347 wins with two Super Bowl championships in 1973 and 1974] and I admire him for his leadership, value system ... and he's very successful.

- Favourite historical figures?

It's hard to put history into perspective and pick only one. Jose' Marti', the liberator of Cuba; President Abraham Lincoln for a vision and leadership that steered the US out of the civil war; this century you look at US presidents Franklin Delanor Roosevelt through World War II and Ronald Reagan.

- Favourite industrialist?

Alfred P Sloan and Henry Ford. Mr Ford created mass production which brought the vehicle to the masses, but Mr Sloan created the governance for a major corporation which served as the model copied by lots of people. GM grew out of acquisitions of 100 companies and how to put it together, to operate as one, is what Mr Sloan achieved.

- Favourite restaurant?

Any restaurant on the water. I love water. My [star] sign is Cancer.

- What's so special about the Cuban cigar?

My family had a cigar business in Cuba [the Diego de Montero brand, later sold to an Uruguayan company]. It's probably in the DNA! Legend has it that Cuban soil is rich and humid and the seeds of the Cuban cigar is what makes it special. I enjoy a good cigar and it doesn't have to be Cuban. It's a myth, a brand.

- Greatest achievement?

When we left Cuba, we went from a very well-to-do to a struggling family. I put myself through school [BA and MBA University of Detroit], after leaving my parents' house in Puerto Rico, in Detroit, Michigan. I created my own persona.

But on a professional level it [my greatest achievement] is the creation of DPSS. It is nothing short of spectacular to watch the growth of all my friends at DPSS.

- If you were in charge of automotive policy in Thailand for a day, what would you do?

My recommendations would be to watch productivity, competitiveness on labour and production, and maintain open borders because that's the only way to trade. And don't let your facilities get old: constantly invest. Also the government needs to have pro-active policy to support the auto industry and allow everybody to participate.

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