Scania increases presence in Arab markets on the Gulf

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Scania will begin assembly of complete vehicles in Jebel Ali Free Zone
Scania is establishing an industrial facility in Dubai for bodyworking and equipping complete vehicles.

"From here we will deliver high-quality fully built vehicles that are adapted to the requirements and operating conditions that apply in the region," said Per Hallberg, Scania's Head of Production and Procurement, at a groundbreaking ceremony attended by Swedish Crown Princess Victoria and other dignitaries.

The facility will have the capacity for customisation of about 1,400 vehicles per year and is located in a 20,000 square metre industrial site in the expansive Jebel Ali economic free zone in the port area of Dubai. Operations will begin during the second half of 2008 and will initially encompass vehicles for construction haulage, such as tipper and concrete trucks, but the facility will also be adapted for future bus bodyworking.

Establishing the plant in Dubai is part of Scania's growth strategy, which includes a greater focus on vehicles in segments where Scania has a weaker position today than in the traditionally strong long-haul segment.

"Our collaboration with selected suppliers that are well-established in Arab markets, together with the shorter lead and delivery times provided by the Dubai facility, will greatly benefit our expansion in the region," Mr Hallberg says.

There is very high demand for heavy trucks and buses in the region due to large investments in infrastructure and new construction ? not only in the United Arab Emirates but also in the other Gulf states. The market for heavy trucks is beginning to approach 20,000 per year. Demand for tourist coaches and public transport buses is also increasing.

"Scania's growth scenario for 2009 and onward also includes increasing our sales in the Gulf states in new segments and gaining market share," says Klas Dahlberg, Scania's regional sales director.

Farid Mohammed Ahmed, Secretary General, Dubai WorldDubai World, commended Scania on the move that has come at the right time in the right place.

"It is a proud moment for Dubai WorldDubai World to witness today the addition of yet another facility that enhances JafzaJafza's position as a primary catalyst for business development in the GCC and the Middle East. Having Scania, one of the world's biggest manufacturers of heavy trucks and buses as our valued partner will definitely support our role in the development and growth of Dubai," he said.

Mr. Ibrahim al Janahi, Senior Vice President, Sales, JafzaJafza congratulated Scania for its increasing focus on the region. He said: "We are delighted to welcome Scania to Dubai and in particular to the Jebel Ali Free Zone, which they have chosen as their regional base. Their decision reflects the company's increasing interest in this market which also coincides with JafzaJafza's own policy of encouraging operations that are relevant to this region. We are glad to facilitate the company's industrial foray into Dubai."

Later this year, Scania will also inaugurate a regional centre for sales and service training in Dubai.

"Training and recruitment of personnel is important to enable Scania to increase sales and develop its service market business in the region," Mr Dahlberg says.

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About Scania
Scania is one of the world's leading manufacturers of trucks and buses for heavy transport applications, and of industrial and marine engines. A growing proportion of the company's operations consists of products and services in the financial and service sectors, assuring Scania customers of cost-effective transport solutions and maximum uptime. Employing 35,000 people, Scania operates in about 100 countries. Research and development activities are concentrated in Sweden, while production takes place in Europe and South America, with facilities for global interchange of both components and complete vehicles. In 2006, invoiced sales totalled SEK 84.5 billion and net income amounted to SEK 8.5 billion

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© Press Release 2008