August 30, 2017

Ramesh Babu G, Managing Director, Ramesh Tours & Travels Pvt Ltd, reminisces his journey in the car rental business from humble beginnings to accomplishing a feat of owning an enviable number of luxury cars today.

Buying a car is everyone’s dream and when one such purchase becomes the starting point of a business idea that is interlocked with uncertainties and risks taken to tread on roads less travelled, it becomes a story to reckon with. Ramesh Babu G, Managing Director of Ramesh Tours & Travels Pvt. Ltd., or RTT as he fondly calls it, recollects his journey in the luxury car rental business.

“Basically, I started with the purchase of a single car – an Omni van – in 1993. I didn’t mean to rent it out. I bought it for my personal use; however, I was not able to pay the EMI. So, I contemplated selling the car, which is when one of my friends suggested that I rent the car. That is how I started my company in 1994. When I started it, the business was good with not much of competition like today. After two years, I bought a Contessa, my second vehicle and then a Maruti Esteem. By 2006, I had six vehicles. After 2006, we continued to add cars and in 2003, I bought my first Mercedes E Class in the luxury category. I was the first one in South India to have a luxury car rental. It was a brand new car from the showroom. It did well; none of the operators had the model in South India. In 2004, I bought one more Mercedes due to the demand. After 2004, I kept adding cars to my fleet. The years 2010 and 2011 were the turning point in my business. I wanted to buy something that no other operator had. So, in 2011, I bought the Rolls Royce Ghost, after which we had some problems. Our state government’s life tax on luxury cars came into effect for luxury cars priced above 15 lakh rupees. I had to pay about Rs. 3.75 crores for it. By then, I had 60 luxury cars. We eventually overcame the situation and continued to expand. Currently, I own about 436 cars as of today – out of them 150 are luxury cars – Mercedes, Audi, BMW, Jaguar, Range Rover, Toyota Alphard and in January this year, I bought a Maybach. The Maybach cost me about 3.3 crores.”

When asked if he planned to buy another Alphard, he quipped, “There is only one Alphard, you cannot have more than this.” It is a six seater car with great luxury, space, 3.5 litre engine, 4 wheel drive and aeromatic suspension.

“Bangalore is the hub of electronics and software; hence, there is more demand for high-end cars in Bangalore. Out of every 100 bookings I get in a month, 80% of them are from corporates and 20% from weddings and few from events, VIP guests, film actors and delegates. We receive a lot of business from delegates of all the embassies who come to Bangalore. Recently, I had given my Maybach to the Prime Minister of Malaysia when he had come to Chennai. I sent it from Bangalore all the way.”

“Presently, I have offices in Bangalore, Chennai and Delhi. Delhi is a very big market but the competition is very high there, as compared to Chennai. There are a lot of embassies in Delhi and hence, there are more such providers. In South, we are the No. 1 luxury car rental providers. We promote ourselves through word-of-mouth and events. All my cars are located across Bangalore, Chennai and Delhi. We have an in-house maintenance.”

“I always like to have different cars that are not available in the country, with any other vendor or competitors. I create a demand. It has been six to eight months since I got the Toyota Alphard. Buying the vehicle is very easy. I find getting drivers very challenging these days. My chauffeur is my sales man. Earlier I used to clear the loans in two to 2.5 years and break even, because the drivers were trustworthy, regular and sought duty. Today, we are asking them to take up duty. It takes me close to four years to clear a car loan nowadays. I lost about 35 drivers to aggregators. But I am sure the situation will change for the better.”

“I feel competition should be there, else we don’t get motivated. Competition is important for any business and I feel there should be competition to be motivated. I stay ahead of competition by way of the services that I offer my clients and through the different vehicles that I have which others don’t.”

Evolution of car rentals
Noting that the car rental industry has changed a lot since the time he entered the business, he observes that the booking methods have changed from waiting for telephone confirmation from corporates to pagers, mobiles and now apps. At present, his company has an app only for booking self-drive models; the chauffeur driven models will get an app shortly.

“RTT means unique journeys. We have unique cars. The Japanese cars are the best in terms of maintenance and durability. The German models do have great features but are very expensive. Next year, we are planning to get some SUVs that are not available in the country and sports cars. The Mercedes range remains the top favourites of my guests. I have Mercedes in E class, S class, GLE, Maybach and GL. BMW, Jaguar and Audi are the other favourites. The Maybach is a very unique car – it has got automated suspension – it senses the road if there is a pothole ahead and changes the suspension accordingly. The Rolls Royce Ghost is my personal favourite,” he concluded.


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