Alpha-Status in Davos for Billionaire Means AA Car AccessMatthew G. Miller and Netty Ismail
Billionaire Rahul Bajaj is obsessed with his Davos car pass.
The 74-year-old chairman of Pune, India-based Bajaj Auto Ltd., the nation’s second-largest motorcycle company and maker of the country’s popular three-wheeled auto rickshaw, has come to the Swiss Alpine resort town to attend the World Economic Forum’s annual meeting every year since 1979. The sticker is one of the perks of being a veteran -- and a friend of the conference’s founder, Klaus Schwab.
“There are three kinds of people who get cars in Davos,” he said while riding in a brown Audi A8 to the forum’s Congress Centre from the Centralsport Hotel a half mile away. “The first are prime ministers and political leaders. The second are double-As, who can get into the private entrance. The third can drive around, but don’t have access to much. I’m a double-A.”
At an event that professes to be a catalyst for improving the environment, one of the most coveted status symbols of all is an elites-only license to drive anywhere in town.
Most of the 2,500 delegates travel around town in black Volkswagen vans that run along three routes, which start and end at the front of the main hall. For billionaires like Bajaj it’s different. His car cruises into the Congress Centre through a basement garage below the center, where an armed guard allows him to pass through a private door.
Bajaj agreed to allow Bloomberg News to accompany him around the forum for most of yesterday to see how billionaires experience the event.
The World Economic Forum seeks to reduce the event’s carbon footprint by requiring cars to fulfill environmentally friendly conditions. Fon Mathuros Chantanayingyong, a spokeswoman for the forum in Geneva, didn’t respond to e-mailed questions regarding the conference’s car-pass policy.
“I go to Davos for two reasons,” Bajaj said Jan. 10 in a phone interview from his home in Pune. “I go there to make new friends and continue old friendships, and I go to enjoy myself, enjoy the weather and learn a lot.”
Bajaj began his day at a session called Global Financial Context, featuring JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon and Elliott Management Corp. founder and billionaire Paul Singer. He left the panel discussion, in which Singer said the banking industry is also “too leveraged and too opaque,” a few minutes early.
Walking through the conference center from the finance session to a private meeting with Schwab and about a dozen Indian executives, Bajaj was stopped to speak to a friend or business associate seven times in 10 minutes. Among the people who said hello: Hussain Dawood, one of the richest men in Pakistan, and billionaire Henry Ross Perot Jr., 54, chairman of Hillwood Development Co., his family’s Dallas-based real estate company. He made sure to invite each person to his “nightcap” that evening at the Steigenberger Grandhotel Belvedere hotel, where the likes of Bill Clinton, Angelina Jolie and Bill Gates have crossed paths in years gone by.
Bajaj is one of 17 Indian billionaires at the conference, the second-largest national collection behind the U.S., which has 18 billionaires in attendance. Of the Indian tycoons, three are on the Bloomberg Billionaires Index, a daily tally of the world’s 100 richest people: Mukesh Ambani, chairman of energy conglomerate Reliance Industries Ltd.; Lakshmi Mittal, chairman of steelmaker ArcelorMittal, and Azim Premji, CEO of software developer Wipro Ltd.
Another Indian billionaire whom Bajaj chatted with before the private meeting with Schwab was Sunil Mittal, chairman of Bharti Airtel. Bajaj enjoyed telling whoever would listen the size and scope of people in the business community.
“Mittal controls India’s biggest telecom company,” he said.
The meeting with Schwab, which reporters were banned from and Bajaj wouldn’t discuss, lasted a half hour. Afterwards, the member of India’s Parliament and billionaire, whose stakes in his family’s six public companies are valued at $1.6 billion, talked with animation -- arm waving, back patting, holding hands -- with several friends, including Bajaj Auto board member Jamshyd Godrej, chairman of Godrej & Boyce Manufacturing Co.
Walking to another event in the Congress Hall, he shook hands with Michael Dell, the 64th-richest person in the world, according to the Bloomberg ranking. Dell, who wouldn’t discuss a proposed leveraged buyout making the news, said he looked forward to seeing Bajaj at a private gathering with about 100 leaders on the International Business Council at 1 p.m.
Bajaj made his way to a session on Russia, was soon bored, and began telling stories about his family’s rise in India.
“My grandfather was a saint,” he said before the panel began.
The Bajaj Group was founded in 1926, at the height of India’s movement for independence from the British, by the billionaire’s grandfather, Jamnalal Bajaj, an adopted son of peace advocate Mahatma Gandhi. His eldest son, Kamalnayan Bajaj -- Rahul’s father -- who was also close to Gandhi, succeeded Jamnalal in 1942. Kamalnayan started M/s Bachraj Trading Corp., the precursor to Bajaj Auto, three years later. Kamalnayan expanded into new businesses, including cement, electrical equipment and scooters.
The company obtained the license from the government in 1959 to produce two and three-wheelers in India. A year later, it agreed with Italy’s Piaggio to manufacture and sell Vespa Scooters.
Four years after obtaining his MBA at Harvard Business School, Rahul became CEO of Bajaj Auto in 1968 at the age of 30. In the 1970s, when Piaggio didn’t renew its license, Rahul began manufacturing his own brand of scooters with names like Chetak and Super.
Bajaj Auto sold 3.8 million motorcycles and 515,000 three-wheelers in India and other countries in Africa, Latin America and South Asia in the financial year ended March 31. Shares of the company fell 1 percent to 2013.05 rupees today.
In 2008, Rahul split Bajaj Auto into three units to boost shareholder returns and give more management control to his two sons, Rajiv and Sanjiv. The predecessor company was split into motorcycle unit Bajaj Auto, finance company Bajaj Finserv and a holding company. Rajiv is the managing director of Bajaj Auto and Sanjiv holds the same position at Bajaj Finserv.
Bajaj and his three cousins -- Madhur Bajaj, Niraj Bajaj and Shekhar Bajaj -- control about 43 percent of Bajaj Holdings & Investment, the holding company of the Bajaj Group. He has a 40 percent share in the Bajaj family’s assets, according to his cousin Niraj, co-chairman of Mukand Ltd., a maker of wire rods, steel bars and alloy castings.
Bajaj left the Russian meeting within 15 minutes and walked through several tan corridors to one of the Congress Centre’s many bilateral meeting rooms, where small groups can have private discussions. There he met with a group of Indian executives on corruption, which he described as “absolutely immoral” and a waste of time to try and solve.
He then joined Dell at the IBC meeting, which included a lunch and was off-limits to reporters. Four hours later, Bajaj emerged tired, saying he had only slept five hours the night before. As hundreds of people lined up to get their coats, he pushed on to the main auditorium to hear speeches by Italian Prime Minister Mario Monti and Christine Lagarde, managing director of the International Monetary Fund. Before Schwab completed his opening remarks, Bajaj was again restless, left the room and called his driver.
Exiting through the private basement designated for Double-As, Bajaj asked his driver to take him to the Belvedre for a reception being held by Harvard University. The billionaire’s car pass, he said, allowed him to drive straight up to the hotel’s entrance rather than climb several sets of stairs. He has had a heart attack in 1984, he said, and didn’t want to exert himself.
At the Harvard party: Carlyle Group managing director and billionaire David Rubenstein; New York Times columnist Nicholas Kristof, and former Secretary of State Henry Kissinger. Bajaj ambled through the room, having one-minute conversations with a dozen people before calling his driver after a half hour. He then returned to his hotel before attending a private dinner for 250 people hosted by Schwab, which he said was “a bore.”
He returned to the Belvedere for his own party around 10 p.m. An hour later, scores of people, including billionaire Stephen Schwarzman, chairman of the world’s biggest private equity firm Blackstone Group, waited in line to clear security and check their coats. Downstairs, Bajaj sipped a cocktail near the door, greeting everyone with a smile, handshake and story.
The event had the feel of a family reunion. Almost all of the guests were Indian, and many wanted to take a picture with Bajaj and London Mayor Boris Johnson, who was a guest.
“Today was a lot of fun,” he said. “And I come here to have fun. I saw so many of my friends. I’m tired, but I think I’ll do it again tomorrow.”