Motor trader started out with nothing

Motor trader started out with nothing

At 18, Neo Nam Heng became a hawker, selling porridge. He moved on to become one of the first parallel importers here. Senior Correspondent Christopher Tan finds out how persistence and an innovative streak have made this son of a 'pirate taxi driver' a success

HE DOESN'T EVEN OWN A CAR: Mr Neo's Prime Leasing has applied for a taxi operating licence. If approved, he expects to deploy a fleet of compressed natural gas cabs as early as next month. -- ST PHOTO: NG SOR LUAN MOTOR trader Neo Nam Heng has one trait that all successful entrepreneurs have: He sees opportunity where others see adversity. Which explains why the 51-year-old is making a foray into the taxi business - one which even the incumbents are finding tough-going because of competition and a shortage of drivers. Mr Neo's Prime Leasing has applied for a taxi operating licence. If approved, he expects to start things rolling with a fleet of CNG (compressed natural gas) cabs as early next month. His tenacity has proven to be his forte over the years. He started working life as a hawker, in 1974. Today, his group - which includes Cheng Yong Credit and Prime Leasing - has an annual turnover of 'over $100 million'. His businesses include the import and export of vehicles, car rental, leasing and financing, as well as the retailing of used and new cars. 'I started with nothing,' said the A-level holder. At 18, he started selling Teochew porridge. He got a deferment from national service 'to help feed my family'. His father was a 'pirate taxi driver' with seven children. He was a hawker for eight years before venturing into exporting used taxis to places such as Johor and Batam. 'That's when I learnt about the car import and export business,' he recalled. In the 1980s, he went into the used-car business and the car rental and leasing line. By 1993, he pioneered parallel importing. Regulations back then were not friendly to parallel imports and Mr Neo remembers 'many barriers, and how we overcame all of them'. In the early years, the authorised distributors dismissed parallel imports as transient. More than a decade later, parallel imports are now a force to be reckoned with, and have been credited with keeping car prices competitive. Mr Neo said: 'We have done something good for consumers.' He is especially proud of another achievement. In 2002, he proposed the setting up of export processing zones. These secured and fenced-up areas, mostly in Tuas, store cars that are bound for export. Once the cars are in the zone, the sellers get the vehicles' tax rebate from the Government almost immediately. Previously, the cars had to leave Singapore first before residual taxes are refunded. The new way freed up cash for the sellers and allowed them to shop for better prices. 'It has saved the industry billions of dollars,' said Mr Neo. 'In the end, we are getting more money back into the country. It's good for Singapore.' The zones have also spawned a new group of visitors to Singapore: Those who come to shop for cars, and who end up staying for a few more days. Mr Neo's vision is for the scheme to grow and rival world-class free-trade zones like the one in Dubai. Mr Neo, president of the Singapore Vehicle Traders Association as well as the Automotive Importers and Exporters Association, has pushed for changes to several other regulations. For instance, he convinced the Land Transport Authority to allow goods panel vans to have glass windows. This has improved safety as drivers get a better field of vision. And in an age of security concerns, a glass-panelled vehicle is also preferable to something with a concealed interior. Previously, there had been concerns that glass made goods vehicles 'look like cars'. Mr Raymond Tang, director of Yong Lee Seng Motor, said: 'He is a very innovative man and he has come up with many ideas to improve the industry.' Mr Neo is also advocating another change: the import of used cars without additional levy or penalty. He believes making reconditioned cars from overseas available here will 'give consumers more choice'. Although the vehicle business has given him a good run, Mr Neo said 'it is beginning to be saturated'. 'That's why we're going into taxis.' Can he make money, when a listed operator like SMRT Corp has been incurring losses on its cab business? 'In 2003, we bought Tibs Leasing (for $13.5 million), which was losing money for many years. Today, it is profitable,' he said. According to the chairman of corporate finance firm SAC Capital, former MP John Chen, Mr Neo gave him lots of feedback on how to make the motor trade more competitive when Mr Chen was minister of state in the then-Ministry of Communications. 'He is very knowledgeable about the industry. He understands government policies well. And he is very persistent,' he said. For all his years of wheeling and dealing in the motor trade, the heavy-set businessman does not own a car. 'I drive whichever rental car is available,' he said. Home is a detached house in the west, where he lives with his wife and two grown-up children. 'I still cook, just to remember where I came from,' he laughed.