Friday, Mar 28, 2008
Gulf News
Dubai: Swedish heavy vehicle maker Scania is among the companies bidding for a Dubai order for 1,616 buses, which will significantly boost the city's public transportation system.
The contract is potentially worth Dh5 billion and would include maintenance of vehicles for 10 years, Scania and its UAE distributor Al Shirawi Group told Gulf News.
Many of these will be double-decker buses.
"We are in negotiations with the Roads and Transport Authority (RTA) to promote our products and understand what they need. These are big buses with high specifications," said Horst Koerner, market support manager of the company's bus division.
Scania expects GCC countries to make large bus purchases as they try to ease traffic congestion in their cities.
"Qatar needs 1,500 buses in five years. Kuwait is also looking for buses. City buses are a major requirement because traffic congestion is growing," Koerner said.
Dubai is expected to have 2,500 buses in operation by 2010 compared with about 600 on the roads now. Abu Dhabi and Sharjah are also potential buyers.
To boost its presence in the Middle East heavy vehicle market, Scania is building a distribution and assembly facility in Jebel Ali Free Zone.
"From here we will deliver fully-built vehicles that are adapted to the region's requirements and operating conditions," said Per Hallberg, Scania's head of production and procurement at a groundbreaking ceremony yesterday attended by Swedish Crown Princess Victoria.
The facility is being developed on an area of 22,000 square metres and will be ready by end-2008.
It will be able to handle 1,400 trucks per year in the first phase, with the capacity rising to 2,000 units after expansion.
Trucks will arrive in semi-knocked down (SKD) condition in containers and will be reassembled and fitted with locally procured parts.
New role
The facility will also be adapted for future bus bodyworking. Hallberg said having a facility will allow the company to cut delivery times and respond better to customers.
"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," Hallberg said.
He said there is a big demand for heavy trucks and buses in the region due to large investments in infrastructure and construction projects across the Gulf.
Scania said the regional market for heavy trucks is close to 20,000 per year.
Scania will inaugurate a regional centre for sales and service training in Dubai later this year.
Gulf News 2008. All rights reserved.
