market assessment kazakhstan and central asian republics ......kazakhstan sought to upgrade its...
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August 2019
Market Assessment
Busworld Central Asia in Kazakhstan last month highlighted the vast opportunities for public transport renewal in the country and region. This report outlines the state of the bus and coach market there and the exciting opportunities for bus builders, operators and infrastructure facilitators in the coming years.
By Joss Hiett
Bus fleets across Central Asia are in urgent need of renewal. According to Kazakhstan’s Ministry of Internal Affairs, 43% of Kazakhstan’s 59,516 buses are more than 20 years old, with a further 26% being between ten and twenty years old1. Alexey Volostnov of Frost and Sullivan, asserts that across Central Asia, 10% of the buses are so old that they should not be used, and that at least 30% of the fleet should be replaced by 20232. The age and unreliability of buses is one factor in the high number of traffic deaths in the region; Kazakhstan, with the most dangerous roads in the region, has 24.2 road traffic accidents per 100,000 people annually3. The UK, for comparison, has 3.14. Inadequate infrastructure, outdated traffic laws, and poor traffic law enforcement also play a significant role in the high rate of accidents, but the lack of crash safety features on these older vehicles is seen as a significant factor in the region’s deaths and injuries from crashes.
Authorities in Central Asia are also keen to upgrade their fleets for environmental and economic reasons. As developing countries, their cities are projected to grow at a faster rate than the global average over the next twenty years, with attendant rises in congestion and air pollution.5 These can be ameliorated by increasing the proportion of people who travel by public transport rather than in private vehicles. According to Dr. Kulwant Singh of the UN, given the high costs of installing infrastructure for urban light rail systems, whether over ground or underground, national and municipal governments in the region are focusing on improving bus services by expanding and upgrading the existing stock, implementing Bus Rapid Transit (BRT) systems, and installing the comparatively cheaper infrastructure for trolleybuses6.
National and municipal governments across Central Asia have already begun to upgrade their transport systems. In Kazakhstan, for example, the four-year ‘Path to the Future’ program, instituted in 2015, has led to large scale upgrades in the bus fleets of major cities: 80% of Almaty’s buses have been replaced since 2016, with similar improvements in Nur-es-Sultan (formerly Astana), the capital. Outside of Kazakhstan, the European Bank for Reconstruction and Development (EBRD) is currently involved in financing the purchase of Euro-6 diesel and CNG buses in Uzbekistan, Tajikistan and Kyrgyzstan,7 and China’s Belt and Road initiative is supporting the construction of pantograph and e-bus infrastructure in cities across the entire region.
However, these developments do bring challenges as well as opportunities for private operators, for municipal and national governments, and for manufacturers.
Kazakhstan and Central Asian Republics – how buses are the future of CARS
Private operators in CARSAcross the region, fares for public transport are often
capped by national governments. To take Kazakhstan, as an example, a scale of fares across the country has been set by the national legislature, with municipal governments permitted to make small adjustments. These fares are set to be well within the means of the local population, whose salaries are significantly lower than those of Europeans and are comparable with the average salary in India. Whilst fare price controls have been effective in encouraging people to use public transport over private cars, they do reduce the profit margins for private operators. Many routes are currently loss-making, but with the shortfall in income currently being made up with generous subsidies through ‘Path to the Future’ program, makes them economically viable; however, unless renewed, this program is set to expire at the end of this year along with the business case. Without direct financial support from the government, however, private operators in Kazakhstan would struggle to stay afloat.8 For private operators, fare controls can reduce their cash reserves available for bus upgrades and make fleet renewal a less attractive option in an environment of thin or non-existent profit margins. So far, in Almaty, private operators have been compelled to upgrade with the use of more stick than carrot – municipal purchases of newer buses encouraged private operators to upgrade in order to provide a comparable service to passengers and avoid losing passengers to city-owned buses. Almaty’s Transport Holding Company also now sets safety, noise and emissions standards for buses bought by private operators as a condition of being granted a route. The introduction of e-ticketing has allowed private operators to gather clear and high-quality data on passenger numbers and fare revenue, increasing investor confidence and allowing those operators to receive loans and financing for new buses, and the IBRD (International Bank for Reconstruction and Development) and EBRD have been active in supporting companies buying low or zero-emissions vehicles.9
Government factors influencing fleet renewal
For national and municipal governments, the challenge is chiefly one of expense. As well as subsidizing private companies, the bulk of upgraded buses have so far been paid for through Transport Department budgets. Government funds are larger than those of private operators and government bodies can borrow money more easily and cheaply, yet the cost of upgrading bus fleets is still a significant expense for national governments with a far smaller tax base and annual budget than European countries. Kazakhstan currently has 3.2 buses per 100 people8, comparable to the US and the UK, but must upgrade its stock on a far smaller budget: Kazakhstan’s GDP was $170 billion in 2018; the GDP for London alone in the same year was $765 billion.
1Vladimir Gerasimenko, Executive Director AKAB, “Bus market in the Republic of Kazakhstan” at Busworld Academy Central Asia. 2Alexey Volostnov, Frost and Sullivan, “Key trends in coach and bus market, Central Asia perspective” at Busworld Academy Central Asia 2019. 3Aynitdin Buralkin, Chairman of the Association of Autotransport Enterprises of the Karaganda Region, “Safety issues of bus transport in Kazakhstan” at Busworld Academy Central Asia 2019. 4https://en.wikipedia.org/wiki/List_of_countries_by_traffic-related_death_rate. 5Volostnov, “Overview of the present bus fleet and the need to renew and enlarge it” at Busworld Academy Central Asia 2019. 6Kulwant Sing, UN, “Promoting Passenger Transport in CIS Countries: Development of Legislation and Formulation of State Policy” at Busworld Academy Central Asia 2019. 7https://www.ebrd.com/news/2019/ebrdmore-doing-more-in-central-asia.html. 8Marlene Laruelle, “China’s Belt and Road Initiative and its Impact in Central Asia”, https://centralasiaprogram.org/wp-content/uploads/2017/12/OBOR_Book_.pdf 9Gerasimenko. 10Jennings. 11Volostnov, “Key Trends”. 12Arabadji 13Arabadji. 14Vostnov, “Key Trends”.
So far, national governments in the region have adopted three principal strategies for securing funding for renewing their bus fleets.
The first is e-ticketing, which has been established in major cities in Kazakhstan, Uzbekistan, Kyrgyzstan, Tajikistan and Mongolia. This has increased fare revenue, and, in Almaty’s case, also allowed the government to pay out less in subsidy to private operators, who had been overclaiming. High-quality passenger data has also made it easier to acquire financing for new projects. The second strategy has been acquiring loans and financing from a mix of sources. As previously mentioned, China’s Belt and Road initiative, has, since 2013, been financing infrastructure and transport across the region. As of 2018, China has invested $6.7 billion in Kazakhstan, $2 billion in Uzbekistan, $2.2 billion in Kyrgyzstan and $717 million in Tajikistan9. The EBRD, which maintains offices in Dushanbe (Tajikistan), Almaty and Nur-Sultan (Kazakhstan) and Bishkek (Kyrgyzstan), currently has $12.3 billion invested in 750 projects across the region, 25% of which are to do with transport and infrastructure10. The third strategy has been to minimize expenditure on fleet renewal by chiefly buying second-hand vehicles. In Kazakhstan in 2016, shortly after the inauguration of the ‘Path to the Future’ program, 12,534 second-hand buses were purchased, versus only 1,056 new buses. In 2017, 7,350 second-hand and 1,084 new buses were bought, and in 2018, Kazakhstan bought 7,690 second-hand buses and 2,420 new ones11. Second-hand bus purchases have hugely outnumbered new bus purchases, as Kazakhstan sought to upgrade its fleet as quickly and cheaply as possible. Whilst the latest used buses weren’t brand new, they were significantly improved on the existing stock in 2015. Over the last two years, however, the proportion of new buses to second-hand has increased from a ratio of 1:11.9 in 2016, to 1:3.2 in 2018.
ManufacturersFor manufacturers, this trend presents opportunities.
Although the market for buses in the region is predominantly second-hand and will continue to be so, there are significant gains to be had for manufacturers willing to push sales of small and medium size low-cost buses. As of May 2019, 65.9% of new buses sold this year in Kazakhstan were small or medium buses, and 74% were categorized as low-cost buses12. Russia and China currently enjoy the lion’s share of this market, with their manufacturers accounting for 73% of the total, with Korea and Japan providing the majority of the remainder. Both Russia and China have been able to benefit partially because of long-standing economic links with the region; Russia still maintains strong historical, cultural and economic ties with the region as the Central Asian republics are all former constituent states of the USSR, and China benefits from regional proximity and aggressive investment since 2013. Golden Dragon has had particular success: between 2018 and 2019, its bus sales in Kazakhstan increased by 1550%, and it has become the most popular brand among private operators13.
However, there is a third way of penetrating the Central Asian market. The constituent countries of the overlapping Central Asian CIS (Commonwealth of Independent States) and ECO (Economic Co-operation Organization) enjoy tariff-free trade with each other, but there are official tariffs on imported vehicles
Continued on p5
News from Busworld Central Asia 2019.Articles from Truck & Bus Builder - August 2019 Volume 41 Issue 8.
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and municipalities have unofficial protectionist policies by preferring manufacturers who operate within the country or its immediate neighbours. Companies from Korea and Japan have skirted tariffs and domestic-manufacture preferences by opening manufacturing plants in-country; Hyundai with Astana Motors in Kazakhstan, and Isuzu with SamAuto in Uzbekistan. Several of the large Turkish manufacturers have plans to do the same, according to their representatives at Busworld Almaty in 2019. In order to qualify as
Continued from p4
Kazakhstan and Central Asian Republics - A market assessment
having been domestically manufactured, only 51% of the process must take place within the country, so foreign manufacturers have been assembling vehicles in domestic plants, having fabricated most of the parts at their own factories. This reduces the amount of capital that must be invested in each new plant, as less training is required for the workers, and fewer specialised machines and tools need to be purchased.
So far, few European manufacturers seem to have similar plans; which was partially evident from the scarcity of European manufacturers at Busworld Central Asia. It is likely that even with in-country plants, European makers would struggle to compete
with their Turkish and Chinese counterparts, who not only have a head-start and closer cultural ties to the region, but whose R&D avenues might make them a better fit for the region’s needs. This is because Central Asian countries are interested in cheap low-emissions and zero-emissions vehicles, as the purchase of these is the priority it seems by large development banks such as the EBRD. With seasonal temperature extremes comparable to the Central Asian region, Turkish and Chinese manufacturers have given greater priority to the battery-insulation technology required for e-buses to operate in these climates. European manufacturers’
Continued on p6
Operator Case Study
Over the last few years, Almaty has had huge success in upgrading its fleet of public transport vehicles and has done so despite severe budget constraints. Since 2016, 80% of its fleet has been replaced, according to Khamrayev Sadir, the General Manager of Almaty Transport Holding Company. As of May 2019, there are 1,680 buses on the road every day, running along 125 routes, serving a population of 1.7 million people, who make an average of 1.3m transactions with their ONAY cards per day.
Almaty’s Transport Holding Company is a private company responsible for ticketing, revenue collection and administration of the city’s bus routes. It mediates between the mayoralty and private companies: It directly manages the municipal bus fleet, which provides about 60% of the city’s buses, and regulates the thirteen private companies which, between them, comprise the remaining portion of the fleet.
Prior to 2016, it was a very different story – Sadir described the company’s whole previous lifetime, stretching back fifty years, as a ‘prolonged period of crisis.’ There were 24 municipal buses and 1000 unofficial buses, most of whom were driven by independent owner-operators. As a result, bus services were inefficient and patchy, and Almaty’s citizens often had to travel in vehicles which were noisy, dilapidated and unsafe. Parts of the city were chronically underserved as owner-operators competed for the most profitable routes.
The key to Almaty’s improvements was the introduction of e-ticketing in 2016, through the ONAY bus payment system. This spurred development in several ways. Firstly, it encouraged Almaty residents to use the bus system rather than their own vehicles or taxis – a standard fare with an ONAY card was 80 KZT, rather than the 150KZT it
Almaty public service fleet renewal strategy had been under the previous cash-based system. Secondly, it allowed the Transport Authority to collect valuable data about bus usage, helping the city receive a national grant to buy 400 buses in early 2017. Thirdly, e-ticketing created a clear record of payment, allowing small owner-operators bank loans to upgrade their own vehicles.
Although the city has spent significant sums on upgrading its fleet, these costs have been offset by significantly higher revenues; in 2016, Almaty’s buses collected approximately USD1.3 million per month. By 2019, that figure had risen to USD5.263 million for the month of May.
E-ticketing has also saved the central government money. Kazakhstan’s central government guarantees preferential fares to members of the twelve classes of citizens who qualify for discounts. Often, these discounted journeys lose money compared to the real cost of the fare, and private operators had been known to claim more subsidy than they were really earning. From 2016 to 2018, the subsidy paid out to private companies plummeted from USD9,822,509 to USD562,586.
The private operators have been somewhat squeezed; not only have they lost a large chunk of their subsidies; they have also had to upgrade their own buses in order to match the quality of the municipal fleet. Nonetheless, Sadir asserted that their costs were being more than offset both by increased fare revenue, and a new form of subsidy on ‘social’ routes, where operators are rewarded for operating routes in remote areas.
The Transport Holding Company is playing a key role in future overhauls. Not only does it set the minimum requirements a bus must meet to operate a route in the city, it has tendered on behalf of the municipal government an order for 200 new midi-buses and 60 large buses this year, with private
operators projected to tender for 200 more. Sadir hopes to improve the quality of buses still further in the future. Whereas the first stage of overhaul involved buying diesel buses from the Russian manufacturer Liaz, and Chinese manufacturers Yutong and Golden Dragon (the latter being the most popular with the private operators), the company intends to focus on cleaner diesel and CNG buses in the future. Sadir emphasised that whilst the first generation of replacement buses did not meet emissions standards expected in Europe, they nonetheless hugely reduced emissions in the city itself by encouraging citizens to use public transport rather than their own vehicles. As he put it “We started with diesel because the awful condition of the fleet at that time. We needed to change it quickly. With our budget, we could have bought fewer, more environmentally-friendly buses, but felt it important to update as much of the fleet, in the shortest possible time, that we could…From an ecological perspective, our top priority is getting people in buses and out of private cars.” Electric buses are not currently seen as an important aspect of Almaty’s transport future due to their cost, the extreme seasonal temperature changes that characterise Kazakhstan, and the mountainous terrain.
Almaty’s Transport Holding Company offers an interesting example for other developing cities. On a limited budget, it used the data provided by an innovative and bespoke e-ticketing system to rapidly upgrade its public transport in a cost-effective manner. Other cities in the developing world which, like Almaty in 2016, have large populations and serious problems with congestion and pollution might well want to adopt the Almaty model. If others do follow suit, commercial opportunities abound for second-hand and refurbished bus sellers to provide the first generation of overhauled vehicles, for data specialists and computer programmers, for development banks and for private lenders, and, eventually, for the large manufacturers to offer green, low-emission vehicles.
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Manufacture / Acquisition / Alternative Fuel
Kazakhstan / China - CKD assembler of JAC-branded cars, Allur Group* announced at Busworld Central Asia in Almaty that it was now assembling buses at its headquarters in Kostanay, Kazakhstan. Since it began manufacturing last year, Allur says it has sold 100 buses in Kazakhstan and suggests that by the end of 2019 it will have sold 300 of its own locally assembled buses in the country. Prior to this development, it had sold Iveco buses with total sales amounting to 700 during a period of four years.
The move to assemble JAC buses locally came about as a result of two transactions; the purchase last year of the Allur Group by a Chinese company, China National Machinery Import and Export Corporation (CMC) and, its cooperation since 2010 with vehicle manufacturing giant, China Anhui Jianghuai Automobile Co Ltd (JAC) of Hefei, China - for more details see below.
Vitalii Loktiev, Allur director of aftersales service and spare parts, at the show attributed the company’s success and recent move into the new bus market to the Kazakhstan government’s three-year plan to upgrade public transport in the country. A condition of the government’s plan was to prioritise vehicles manufactured within the country for municipal purchase.
Loktiev added Allur was currently engaged in a one-year trial of five electric buses in Aktau, used on the airport-city centre routes, and ten electric buses in Pavlodar, for use on inner-city routes. The airport bus, the HFF6123G03EV-2, manufactured
Allur Group assembling JAC buses in Kostanay, Kazakhstan
under the brand name Ankai, is 12 metres long with space for 37 seated passengers. It uses a 600AH/538V battery, providing a range of up to 320 kilometres with a maximum speed of 69 km/h. The drivetrain is made in-house by Ankai. In Pavlodar, the 10-metre HFF6101K10EV, with space for 46 seated passengers, is being trialled. It has a slightly smaller 585AH/538V battery but can travel up to 100km/h and uses the same Ankai drivetrain as the 12-metre model. Both models have a full-charge time of approximately 2.4 to 4 hours.
The company is also focused on developing CNG buses for the region. At present, it has 80 CNG buses operating in Aktoba; with the abundance and relative cheapness of CNG in the region, Loktiev said, it was highly likely to result in further orders for CNG buses in Central Asian cities.
*Allur Group - China National Machinery Import and Export Corporation, a wholly owned subsidiary of China General Technology Group (Genertec) of Beijing in December 2018 acquired all the shares in Kazakstan’s Allur Group. Included in this acquisition was the passenger car producer, SaryarkaAvtoProm LLP, which has been producing vehicles in Kostanay since 2010. It is claimed it is the only producer of CKD (CKD production including the body welding, painting and assembly) passenger cars in Kazakhstan. It produces a range of cars sourced from China Anhui Jianghuai Automobile Co Ltd (JAC) in Hefei, China, claiming a 36% local content..
Trend / Alternative Drive
Germany / Kazakhstan – Claiming that almost all buses in Astana, Kazakhstan’s capital, already have Voith transmissions, Anton Khapugin, Voith regional sales director said at Busworld Central Asia in Almaty at the end of June the potential for sales growth in the region for its DIWA transmissions was huge. He said the potential for growth in Almaty and in other Central Asian cities was due to the high compatibility of its transmissions with CNG engines, which Khapugin believed were most likely to become the main successor to diesel buses in the region over the coming years.
Huge potential for Voith transmissions with gas buses in Central Asia, says representative at Busworld Almaty
Voith Turbo, the division of the Voith group which specialises in drive and braking systems, were present at Busworld Central Asia Almaty to expand their already sizeable footprint in Central Asia. Promoting its automatic transmission, which was first developed over sixty years ago and has undergone continuous refinement ever since. The transmission today has four forward gears, one overdrive gear and one reverse gear and the latest version, DIWA.6 is designed to prevents gear changes until the vehicle is travelling at 20km/h to reduce fuel consumption, reduce maintenance and extend the life of the transmission.
best hope is to focus on the second-hand market, potentially by instigating strategic buyback schemes in Western Europe for older Euro-VI diesel and CNG buses.
Direct imports of new buses are still a possibility – currently, domestic production facilities can produce only 25%14 of the region’s projected needs by 2023, but it will be difficult for European manufacturers to compete on price with low cost producers from Russia, China and Turkey.
One notable strand in bus trends across the region is the growing importance of data. Companies specializing in e-ticketing software and hardware, data analysis to optimize bus routes and inaugurate demand-responsive schedules, and fleet telemetry
will enjoy a wealth of opportunities. In the case of Almaty, e-ticketing and data collection underpinned its fleet renovation programme and allowed Almaty’s Transport Holding Company to offset the significant costs of renewal. National governments across the Central Asian region have a pressing need to improve and expand their fleets and they must do so on limited budgets. Modern technology and accurate, large-scale data collection will help them target their money in the most cost-effective manner.
Investing in the region holds significant challenges, but there is a strong chance of significant rewards for manufacturers, distributors, operators and fleet management system suppliers who can adapt to the needs and limitations of the Central Asian republics.
The remainder of this reporton pages 5 to 8 focuses on the Busworld Central Asia Exhibition and the key developments announced by the manufacturers and suppliers attending the event.
Continued from p6
Kazakhstan and Central Asian Republics - A market assessment
Investment / Expansion / Export
Uzbekistan / Kazakhstan – Samauto* of Samarkand, Uzbekistan is planning to produce some 10,000 buses in 2019, which would be more than double the 4,000 units built in 2018, suggested Serkan Öztürk, export specialist for Samauto at Busworld Central Asia in Almaty, Kazakhstan held at the end of June.
Building on strong growth within Uzbekistan in the medium duty bus segment, Öztürk said Samauto planned to expand its exports business, focusing strongly on sales to other CIS countries. Öztürk acknowledged this was an ambitious goal, but one which it needed to achieve to justify expansion of its manufacturing facilities and building two and a half times the number of vehicles produced last year. According to Öztürk, since 2006, Samauto has exported 850 buses, 200 of those to Kazakhstan since it established dealerships there in 2010.
Öztürk, said Samauto currently produces five bus models from six to eight metres in length, equipped with either diesel and CNG engines made by Isuzu Motors and Cummins. As well as buses, Samauto manufactures trucks and specialist vehicles, producing ten different models of chassis which can be combined with 40 different bodies.
At Busworld Central Asia Samauto exhibited its LE 60 and HC 40 bus models. The 8m LE 60 low-entry model has either a Cummins 4ISBe4 185B or an ISUZU 4HK1-TCC engine and automatic Allison 2100 gearbox and can accommodate up to 57 passengers. The 38 passenger 6.9m HC 40 high floor bus has a front-mounted Isuzu 4HF1 engine and Isuzu MYY5T gearbox.
The buses are built at the factory in Samarkand, Uzbekistan, using CKD kits from Japan.
*Samauto – Samauto is the brand name of Samarkand Automobile Factory LLC of Samarkand, Uzbekistan, a joint venture between Uzbek company, SamKochAuto, also of Samarkand, the Itochu Corporation and Isuzu Motors Ltd.
Samauto aiming to double bus production this year
Technology / Data Management
Kazakhstan - ONAI, Almaty’s cashless public transport payment system, was established in 2015 as part of a government scheme to improve Kazakhstan’s digital infrastructure by 2020. Having consulted systems used in 24 other cities (London’s Oyster Card and Hong Kong’s Octopus card) it proceeded to develop its own system, tailored to the habits of its local citizens.
The project has been extremely successful: Fewer than 1% of bus payments are in cash, the majority of those being from non-natives. ONAI cards not only reduces the price of travel but it can be used as a secondary debit card and used as a discount card at many cinemas, restaurants and bars in Almaty. It can be topped up at one of 3000 kiosks in Almaty or via a mobile App.
Currently 80% of Almaty’s citizens have ONAI cards, and use them to make 1.2 million transactions per day. The principal advantage of the ONAI system is that it has allowed Almaty’s transport authorities to gather huge volumes of high-quality data about who is using public transport, how much they are using it, and at what times, thus allowing them to improve their bus routes and increase provision at the most heavily-trafficked times of day and areas of the city.
Almaty’s ONAI card gives great management data
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IN THIS ISSUE
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Special Supplement to Truck & Bus Builder on Commercial Vehicle Developments in India
Contract
China - BYD Auto Co Ltd of Shenzhen, China,
a fast expanding new energy company, with
its short but very progressive 15 year history in
battery technology and now since 2003 and 2009,
also specializing in the manufacture of electrically
powered cars and taxis and most recently buses,
announced at Busworld last month that it has won
an order for 2000 full size electric buses from the
City of Shenzhen, Guangdong Province, China.
Paul Lin, senior manager, branding, BYD,
explained that the city of Shenzhen announced
in July this year that by 2015 all public vehicles
buses, taxis and other state-owned vehicles
operating in the city would be those that were fully
electrically powered only with zero emissions. Lin
added that during the recent Universiade2011
(University games) held in Shenzhen in August this
year, 40, BYD electric buses (eBUS-12) served the
sports village, sports venues and media centre, to
provide transportation for competitors, technical
officials, reporters and spectators. Lin said that
already 200 eBUS-12 were being operated as part
of Shenzhen’s public transportation system.
The eBUS-12 is a three-door full low floor city
bus made of an all-aluminium monocoque body
construction. It is fitted with a synchronous
e-motor, which
drives through
a 3-speed
automatic transmission, with electrical energy
stored in BYD’s own Fe battery pack, for which
BYD calculates, will last a full ten years based on
4000 cycles. (He also stated that the company
made battery packs with capacity for 6000 full
cycles, the equivalent to 15 years life). The battery
pack, says Lin, can then be recycled for energy
storage in another application such as solar power
storage. The eBUS is fitted with ZF rear drive axle
and has electronically controlled air suspension
front and rear which provides a kneeling function.
Lin is also able to installed the 100kW charging
station and thereby provide a turn key solution to
Vehixel and Indcar announce collaboration
to expand business internationally
its customers).
The eBUS-12, has a curb weight of 13.8t and
offers what Lin considers to be a conservative range
of 250km on a single charge in urban conditions
with stop-start depending on the duty cycle (280
to 300km is possible on less demanding routes,
says Lin). The bus can be fully charged in 3.5 hours
with a 100kW charger; energy consumption, says
BYD, is around 130kWh/100km with a battery
power pack density of 324kwh.
BYD exhibited at both APTA Expo in New
Orleans, USA and Busworld in Kortrijk, Belgium,
last month to introduce its eBus on both continents.
At Busworld, Lin announced that the eBus would
enter trial service in several European cities,
including Copenhagen and Frankfurt, in the coming
months. It is also understood that BYD’s electric
bus has started undergoing trials at one of the
world’s busiest airports in the city of Los Angeles.
The company added that the eBUS-12 was the
first in a range of electric buses under development;
other variants are to include a 10m model (eBUS-
10, 280km per charge), a double deck (eBUS-
12D, 200km per charge) and a right-hand-drive
version of its eBUS-12.
A further development announced as Future
Fuels & Power was going to press was an
agreement signed by BYD and Daimler AG
to establish “Shenzhen BYD Daimler New
Technology Co Ltd,” a 50:50 research and
technology centre to develop electric cars in China.
A further development announced as Future
Fuels & Power was going to press was an
agreement signed by BYD and Daimler AG
to establish “Shenzhen BYD Daimler New
Technology Co Ltd,” a 50:50 research and
technology centre to develop electric cars in China.
A further development announced as Future
Fuels & Power was going to press was an
agreement signed by BYD and Daimler AG
Investment / Research Centre
Germany / USA - Voith Turbo GmbH & Co KG of
Heidenheim, Germany, has opened a hybrid power-
train development centre in Poway, California, north
of San Diego for the further development of its hybrid
diesel/electric drive systems for transit buses.
Voith says that the centre covers more than
5000 square feet and includes office, warehouse
space and testing facilities. Also, a large solar panel
installation provides electricity for most day-to-day
facility operations.
“We are extremely excited to open a US-based
Hybrid Power-Train Development Centre,” said
Rob Wiss, vice president, Voith Turbo US Road
Voith opens US hybrid centre
Product / Technology
Product / Technology
USA - BAE Systems of Johnston City, New
York, USA used APTA Expo 2011 in New Orleans,
Louisiana, last month to launch, the HDS 300
system, its HybriDrive series propulsion system for
articulated buses.
Based on the company’s proven HDS 200 hybrid
electric propulsion system technology currently
deployed in more than 3,500 transit buses across
the globe, the HDS 300 system will allow higher
capacity buses with gross vehicle weight ratings of
up to 63,000lbs (28.6t).
BAE Systems said it was currently working with
bus manufacturers New Flyer and Nova Bus to
make its HDS 300 hybrid electric propulsion system
available to North American bus transit fleets.
The system, BAE added, can be purchased as a
standard package or with electrified accessories
which further increase the system’s efficiency
by reducing energy demands on the engine.
Electric accessories offer reduced maintenance
and improved safety over their conventional
counterparts, eliminating the normal jungle of belts
and hydraulic lines from the engine compartment.
USA - BAE Systems of Johnston City, New
York, USA used APTA Expo 2011 in New Orleans,
Louisiana, last month to launch, the HDS 300
system, its HybriDrive series propulsion system for
articulated buses.
Based on the company’s proven HDS 200 hybrid
electric propulsion system technology currently
deployed in more than 3,500 transit buses across
the globe, the HDS 300 system will allow higher
capacity buses with gross vehicle weight ratings of
up to 63,000lbs (28.6t).
BAE Systems said it was currently working with
bus manufacturers New Flyer and Nova Bus to
make its HDS 300 hybrid electric propulsion system
available to North American bus transit fleets.
The system, BAE added, can be purchased as a
standard package or with electrified accessories
which further increase.
Kässbohrer moves into truck
body building
Irizar plans entry into USA
Division. “The centre will allow us to further
develop hybrid bus technologies and cater to
the specific needs of our customers who want
to expand their use of this emerging technology.
Above all, we are making an important contribution
to the US economy by expanding the use of
clean-energy technology in transportation fleets
across the country.”
California-based Maxwell
Technologies is
to supply Voith with ultra capacitors; it already
uses Maxwell to supply systems for its patented
DIWAhybrid parallel drive system, which went into
production last month. Voith has been working
with Gillig to field test its parallel DIWAhybrid drive
system and says the aim of the Hybrid Power-
Train Development Center to expand on DIWA and
create new hybrid technologies for the US market.
INDIA
AXLES
1
SPECIAL SUPPLEMENT 13
MArCh 2014
Special Supplement to Truck & Bus Builder on Com
mercial Vehicle Developm
ents in East Asia
EAST ASIA
AXLES
1
Assembly / Agreem
ent
South Korea / Vietnam - Hyundai M
otor Co
of Seoul, South Korea is considering pulling out
of an agreement with Vietnam
’s Truong Hai Auto
Corporation of Ho Chi Minh City in Vietnam
,
because of delays in completing a local plant.
Hyundai signed an agreement with Vietnam
’s
largest comm
ercial vehicle assembler in 2011 for
the latter to assemble diesel engines at a new
USD182m facility in the Chu Lai Econom
ic Zone of
Vietnam’s Quang Nam
province.
But the delay in implem
enting the agreement has
Hyundai reviews Vietnam diesel engine project
meant that Hyundai’s regional requirem
ents have
moved on from
what was originally agreed. The
Korean firm is now understood to object to Truong
Hai’s plans to press ahead with assembly of Euro
II and Euro III engines, saying it would prefer to
switch to Euro IV engines from 2016.
Meanwhile, the Vietnam
government has just
approved the assembly by Truong Hai of up to
100,000 diesel engines over a five year period,
ending in
December
2018, in
line with
the
specification requirements of the local m
arket.
Expansion / Assembly / Distribution
Indonesia / Sweden - Swedish truck and bus
manufacturer, Scania AB of Sodertalje, aim
s to
strengthen its position in the Indonesian bus market
following the establishment of a new bus plant in the
country in late 2013, with the collaboration of its long-
standing local truck distributor, PT United Tractors.
The new
facility has
a m
onthly production
capacity of 25 completed buses, or around 250-
300 units per year. Demand for intercity and tourism
buses in Indonesia has expanded rapidly over the
last several years, with rising incomes encouraging
more leisure travel.
Public transport in the country’s major cities is
also heavily dependent on buses and demand here
is also increasing rapidly. The overall bus market is
currently dominated by Hino and M
ercedes-Benz,
with Chinese brands beginning to make inroads in
the last year or two.
Scania has a stronger presence in Indonesia’s mining
truck segment, however. The com
pany estimates last
year’s truck sales in the country at 450 to 500 units, a
level largely unchanged from the previous year despite
the tough conditions in the mining sector - with coal
prices depressed for some tim
e.
Indonesia is one of Asia’s largest producers of
coal, which it exports to major regional m
arkets such
as India and China. Scania estimates that around
95% of its truck sales in this country are to m
ining
companies. Its largest client here is PT Pam
apersada
Nusantara (PAMA), which has one of the largest fleets
of mining trucks in the world - including 640 Scanias.
Mikael Benje, head of Scania’s representative office
in Indonesia, said around 2,900 Scania mining trucks
were currently in operation in Indonesia, as well as
Scania expands presence in South-east Asia
150-200 (mostly im
ported) buses.
Scania expects
its truck
sales to
increase
from current levels, particularly when coal prices
recover and investment in coal production rises
once again. Mr Benje believes the tough off-road
operating conditions in this segment offer additional
opportunities for his company.
The com
pany has
established a
new parts
warehouse in Singapore to improve afterm
arket
supplies and reduce its clients’ truck downtime.
“Mining vehicles are worked hard and require rapid
access to parts. One of the reasons we built a new
parts warehouse in Singapore is that we want to cut
lead times in the region”, M
r Benje added.
Large truck operators in Indonesia increasingly
look at the life-cycle costs of trucks, including fuel
consumption, and capacity utilisation, rather than
just the initial truck cost and load capacity, says
Scania. This is expected to benefit European truck
manufacturers such as Scania, as well as others,
Mercedes-Benz and Volvo for exam
ple, which offer
good fuel economy and durable trucks com
pared
with Japanese and Chinese trucks.
Scania is also enjoying strong demand for its
vehicles in Singapore, fuelled by the island-nation’s
construction boom. It sold over 200 trucks in this
market last year and the com
pany claims to have a
strong presence in the bus segment, having delivered
1,100 units since 2007. Deliveries in 2013 are
estimated at around 30 units, however.
As regards other markets in the region, Scania sold
around 670 comm
ercial vehicles in Malaysia and
500 in Thailand last year. It also recently established
dealer operations in Myanm
ar in 2013.
Product
Japan / Germany - Last m
onth saw Kawasaki-
based Mitsubishi Fuso Truck & Bus Corporation
New 8.55t Fuso Canter
now on sale in Japan
Aftermarket / Investm
ent
Japan / Singapore - Isuzu Motors Ltd of
Shinagawa-ku, Tokyo, Japan, through its subsidiary,
Isuzu Motors Asia Ltd has established a new
aftermarket centre in Singapore to help im
prove
aftermarket parts availability and service backup
across the ASEAN region.
The Singapore centre is to be managed by Isuzu
Motors Asia Ltd and is in response to increasing
volumes of Isuzu m
edium and heavy trucks in use
in the region and rising local content levels. Isuzu
Motors Asia Ltd was established in M
arch 1996
and its function is the control of Isuzu business
in ASEAN countries, supply of CKD parts/service
parts and providing support for after-sales activities
of distributors / dealers in the ASEAN region.
The new aftermarket parts facility has been set
up in Johor, on the southern tip of the Malaysia
peninsula and just across the causeway from
Singapore, with more than 30,000 parts in stock to
supply aftermarket distributors across the region.
A similar centre was established in Dubai in 2010
to serve Middle-Eastern m
arkets.
Isuzu establishes new
aftermarket centre in
Singapore
(a subsidiary of Daimler AG
) introduce a new high-
payload version of its Canter medium
-duty truck
through its network of dealerships across Japan.
The new truck has a payload of almost six tons
and a gross weight of 8.55 tons, compared with
a maxim
um gross weight of 8.25 tons previously.
The new truck model is also being rolled out this
year in 40 other markets worldwide.
Export / Expansion
USA / South Korea – February saw US truck-
maker, Navistar International Corporation of
Lisle, Illinois, USA enter the South Korean market
with the launch of its ProStar 6x4 range of heavy
cargo trucks, powered by its 475hp 12.4-litre
(Maxxforce 13) engine.
The m
ove by
Navistar follows
the recent
implem
entation of a trade agreement between
South-Korea and the USA in March 2012, which
eliminates im
port tariffs on these products.
Navistar says it has sold 70,000 units of this truck
model in the US to date and is upbeat about its
sales prospects in South Korea. The company
claims that the ProStar, which it has priced at KRW
159 million (USD149,000), is 9%
more fuel-efficient
than its European competitors.
Navistar suggests
the South
Korean heavy-
duty truck market is currently 55%
controlled by
European brands such as Mercedes-Benz, Scania,
Volvo and MAN, with the rem
ainder taken up by
domestic trucks from
Hyundai and Tata Daewoo.
Navistar plans to support products in South Korea
through its International truck dealerships, currently
found at six locations and plans to continue to grow
its service and support network.
ProStar units for the Korean market are built at
the company’s assem
bly plant in Springfield, Ohio.
Navistar enters South
Korea’s heavy truck market
SP
EC
IAL S
UP
PLE
ME
NT 1
AP
RIL 2014
Special Supplement to Truck & Bus Builder on C
omm
ercial Vehicle Developm
ents in South America
SOUTH AMERICA
AXLES
1
Dear R
eader,
Welcom
e to
our new
est regional
supplement
recording the
most
important
developments
concerning the
comm
ercial vehicle
manufacturing
industry in Brazil and other South Am
erican countries.
As w
ith our
other regional
supplements,
we
highlight new
business
relationships, new
products, legislation impacting the m
arket and the
manufacturers’ research and production strategies.
As usual we look at the m
arkets by product segment
and w
eight. In
this inaugural
edition w
e have
focussed on the largest market, B
razil.
Jim G
ibbins, editor
Jose C Secco
, local correspondent
Investment
Brazil
/ U
SA
-
Supplying
engines for
new
customer applications in trucks and buses is one
of the key pillars of Cum
mins’ grow
th strategy in
Brazil.
As
part of
this initiative,
Cum
mins
Inc of
Colum
bus, Ohio, through its subsidiary, C
umm
ins
Brasil Ltda of S
ão Paulo, B
razil plans to invest
US
D48m
on engineering technology and in further
modernization
of its
plant in
Guarulhos,
state
of São P
aulo unit, where its diesel engines are
produced. It also announced plans to invest more
than US
D90m
in the first phase of construction
of a new plant at Itatiba, in state of S
ão Paulo,
to where it plans to transfer its energy and filter
business areas. This new plant is expected to
begin operations during 2015.
The com
pany expects
the truck
market
to
grow steadily in 2014, by betw
een five and ten
per cent. A num
ber of truck manufacturers have
launched production
operations recently
with
trucks fitted with C
umm
ins engines. One such
example w
ould be MA
N Latin A
merica, w
hich has
been installing the Cum
mins IS
L 420hp engine in
the VW C
onstellation since 2012. Other brands
that have installed or plan to offer a Cum
mins
Cum
mins to invest U
SD138m
in diesel engine
manufacturing operations in B
razil
engine unit in Brazil are all C
hinese; they include
Beiqi Foton M
otor, Foton Aum
ark do Brasil,
Metro-S
hacman and JA
C M
otors should utilize
the brand’s
engines. Foreign
manufacturers
/
assemblers m
ust comply w
ith local rules, which
require that 65% of com
ponents must be sourced
from w
ithin Brazil – so thus requirem
ent ensures
that the engines are built by Cum
mins in B
razil and
not imported from
China.
Cum
mins estim
ates that nearly 70,000 diesel
engines are to come off its production lines this
year for installation in trucks. For the bus segment,
the company expects an increase in m
arket share
from 11%
to 20% w
ithin three years, with its
engines being offered in a number of new
models
and in
new
applications during
this tim
e; this
includes, says Cum
mins, the supply of engines to
Mercedes-B
enz do Brasil for installation in light-
duty Mercedes-B
enz buses.
Cum
mins Inc has four divisions and business
in Latin
Am
erica is
split as
follows:
Engines
45%, D
istribution 30%, Energy G
eneration 13%
and components 14%
. After a slow
er year than
expected in 2013, the company is now
focused
on meeting forecast projected grow
th.
Import / D
istribution / Agreem
ent
Brazil / C
hina - Following in the footsteps of a
number of its fellow
truck and bus manufacturers,
like Shaanxi A
uto, Sinotruck and Foton, another
Chinese
bus producer,
Shanghai
Shenlong
Bus C
o Ltd (Sunlong) of S
hanghai, China, has
announced that it plans to begin exporting buses
to Brazil before the end of June.
This announcem
ent w
as m
ade by
Brazilian
entrepreneur, Mauri M
oreira de Oliveira, w
ho has
been appointed
as S
unlong’s B
razilian partner.
Oliveira announced that he w
ould be investing
an initial BR
L15m (U
SD
6.4m) to construct a new
distribution centre on an 80,000 sq m site in Juiz
de Fora, in the state of Minas G
erais.
With 35 years of experience in the segm
ent and
having worked w
ith foreign bus chassis builders,
Volvo and Scania and B
razilian bus body builder,
Com
il, Oliveira stated that S
unlong’s arrival in Brazil
would be the result of three years of discussions
and negotiations with the C
hinese builder.
Oliveira says the buses and coaches are to be
imported fully built up ready for operation in the
Brazilian m
arket place and that already, a number of
vehicles were undergoing type approval in the country.
Shenlong Bus appoints industry entrepreneur
in Brazil to sell Sunlong buses
As is com
mon in the passenger car and truck
segments,
buses im
ported from
C
hina have
a
certain attraction and market place due to their
often highly competitive low
price. Oliveira points
out that
the vehicles
being im
ported, how
ever,
incorporate a great deal of advanced technology
to improve both com
fort and safety such as air
suspension, air conditioning systems and A
BS
.
Oliviera says that w
hilst all the imported vehicles
would be equipped w
ith diesel engines, Sunlong
has the technology to offer a full range of other
powertrains
including hybrid
vehicles, electric
vehicles and even buses propelled using fuel cells.
How
ever, import of such m
odels would only be
likely once the Brazilian governm
ent had defined its
incentive programm
e.
Oliveira
also announced
that S
unlong w
ould
consider producing buses in Brazil in a few
years’
time; this w
ould, if it went ahead, be its first plant
outside of China. O
liveira remarked: “O
ur plan is to
win a sm
all slice of the Brazilian m
arket by offering
products that complem
ent the market.”
Sunlong buses to be sold in B
razil are to include
9m to 12m
coaches and 12m city buses.
Brazil - In addition to the ungraded Ford C
argo
816, Ford Trucks of São B
ernardo do Cam
po, has
announced that later this year it plans to expand its
presence in the medium
truck market by offering
the 11 ton Cargo 1119 m
odel. Details w
ere not
released but Ford suggests it will have the highest
output and load capacity in its class.
Product
Ford to offer new 11t truck
Sweden
/ B
razil –
Worldly
knnown
for its
brake system
s and
brake com
ponent products
for comm
ercial vehicles, Sweden’s H
aldex AB
of
Landskrona, is targeting the Brazilian truck and bus
markets to expand sales.
Brazil is, indicates H
aldex, the largest and single
most im
portant country in South America. It points out
that, after a slow year in 2012, the B
razilian economy
once again started to show its strength during 2013.
In addition to a growing econom
y, Brazilian legislation
was also driving technical developm
ent forward. An
emissions standard equivalent to EU
RO
5 had, Haldex
points out, already been introduced, as well as rules
regarding ABS and autom
atic brake adjustment.
AB
S
legislation w
as introduced
in 2013
and
required new trailers in B
razil to be equipped with
AB
S system
s, comm
ents Haldex, adding that the
legislation would be fully im
plemented in 2014.
The AB
S legislation w
as also expected to increase
the penetration rate of automatic brake adjusters
in order to fully utilize AB
S perform
ance. Haldex
draws
attention to
the fact
that annual
trailer
production volume for the S
outh Am
erican market
amounted to approxim
ately 80,000 vehicles.
In its annual report for 2013 it points out that Haldex’
new m
anufacturing plant in São José dos Cam
pos
saw a 50%
increase in production volume. This, it
says, is a brand new facility w
ith a new organization,
so this positive progress is a welcom
e addition to
meet the grow
ing demand in South Am
erica. The
plant in São José dos Cam
pos replaced three former
sites, and it was, says H
aldex, carefully chosen for its
strategic and logistical location.
Sales
Haldex targets Brazilian m
arket
VOLUME 35 ISSUE NUMBER 4 MaRch 2014
www.truckandbusbuilder.com 1
The International Newsletter of commercial Vehicle Manufacturing Developments
Contract
China - BYD Auto Co Ltd of Shenzhen, China, a fast expanding new energy company, with its short but very progressive 15 year history in battery technology and now since 2003 and 2009, also specializing in the manufacture of electrically powered cars and taxis and most recently buses, announced at Busworld last month that it has won an order for 2000 full size electric buses from the City of Shenzhen, Guangdong Province, China.
Paul Lin, senior manager, branding, BYD, explained that the city of Shenzhen announced in July this year that by 2015 all public vehicles buses, taxis and other state-owned vehicles operating in the city would be those that were fully electrically powered only with zero emissions. Lin added that during the recent Universiade2011 (University games) held in Shenzhen in August this year, 40, BYD electric buses (eBUS-12) served the sports village, sports venues and media centre, to provide transportation for competitors, technical officials, reporters and spectators. Lin said that already 200 eBUS-12 were being operated as part of Shenzhen’s public transportation system.
The eBUS-12 is a three-door full low floor city bus made of an all-aluminium monocoque body construction. It is fitted with a synchronous e-motor, which drives through a 3-speed automatic transmission, with electrical energy stored in BYD’s own Fe battery pack, for which BYD calculates, will last a full ten years based on 4000 cycles. (He also stated that the company made battery packs with capacity for 6000 full cycles, the equivalent to 15 years life). The battery pack, says Lin, can then be recycled for energy storage in another application such as solar power storage. The eBUS is fitted with ZF rear drive axle and has electronically controlled air suspension front and rear which provides a kneeling function. Lin is also able to installed the 100kW charging station and thereby provide a turn key solution to
Vehixel and Indcar announce collaboration to expand business internationally
its customers).The eBUS-12, has a curb weight of 13.8t and
offers what Lin considers to be a conservative range of 250km on a single charge in urban conditions with stop-start depending on the duty cycle (280 to 300km is possible on less demanding routes, says Lin). The bus can be fully charged in 3.5 hours with a 100kW charger; energy consumption, says BYD, is around 130kWh/100km with a battery power pack density of 324kwh.
BYD exhibited at both APTA Expo in New Orleans, USA and Busworld in Kortrijk, Belgium, last month to introduce its eBus on both continents. At Busworld, Lin announced that the eBus would enter trial service in several European cities, including Copenhagen and Frankfurt, in the coming months. It is also understood that BYD’s electric bus has started undergoing trials at one of the world’s busiest airports in the city of Los Angeles.
The company added that the eBUS-12 was the first in a range of electric buses under development; other variants are to include a 10m model (eBUS-10, 280km per charge), a double deck (eBUS-12D, 200km per charge) and a right-hand-drive version of its eBUS-12.
A further development announced as Future Fuels & Power was going to press was an agreement signed by BYD and Daimler AG to establish “Shenzhen BYD Daimler New Technology Co Ltd,” a 50:50 research and technology centre to develop electric cars in China.
A further development announced as Future Fuels & Power was going to press was an agreement signed by BYD and Daimler AG to establish “Shenzhen BYD Daimler New Technology Co Ltd,” a 50:50 research and technology centre to develop electric cars in China.
A further development announced as Future Fuels & Power was going to press and technology centre to develop electric cars in China.
Product / Technology
Product / Technology
USA - BAE Systems of Johnston City, New York, USA used APTA Expo 2011 in New Orleans, Louisiana, last month to launch, the HDS 300 system, its HybriDrive series propulsion system for articulated buses.
Based on the company’s proven HDS 200 hybrid electric propulsion system technology currently deployed in more than 3,500 transit buses across the globe, the HDS 300 system will allow higher capacity buses with gross vehicle weight ratings of up to 63,000lbs (28.6t).
BAE Systems said it was currently working with bus manufacturers New Flyer and Nova Bus to make its HDS 300 hybrid electric propulsion system available to North American bus transit fleets. The system, BAE added, can be purchased as a standard package or with electrified accessories which further increase the system’s efficiency by reducing energy demands on the engine. Electric accessories offer reduced maintenance and improved safety over their conventional counterparts, eliminating the normal jungle of belts and hydraulic lines from the engine compartment.
USA - BAE Systems of Johnston City, New York, USA used APTA Expo 2011 in New Orleans, Louisiana, last month to launch, the HDS 300 system, its HybriDrive series propulsion system for articulated buses.
Based on the company’s proven HDS 200 hybrid electric propulsion system technology currently deployed in more than 3,500 transit buses across the globe, the HDS 300 system will allow higher capacity buses with gross vehicle weight ratings of up to 63,000lbs (28.6t).
BAE Systems said it was currently working with bus manufacturers New Flyer and Nova Bus to make its HDS 300 hybrid electric propulsion system available to North American bus transit fleets. The system, BAE added, can be purchased as a standard package or with electrified accessories which further increase.
Kässbohrer moves into truck body building
Irizar plans entry into USA
Truck & Bus Builder
IN THIS ISSUE
Dietrich Carebus pioneer’s new child seat 2
Indcar to build buses in Romania 3
DCG importing Yutong coaches to Europe 4
EEC trailer innovation award results 6
ATDyanmics enters Europe with boat-tail 8
Foton enters Europe with new energy 9
Germany / USA - Voith Turbo GmbH & Co KG of Heidenheim, Germany, has opened a hybrid power-train development centre in Poway, California, north of San Diego for the further development of its hybrid diesel/electric drive systems for transit buses.
Also, a large solar panel installation provides electricity for most day-to-day facility operations.
“We are extremely excited to open a US-based Hybrid Power-Train Development Centre,” said Rob Wiss, vice president, Voith Turbo US Road Division. “The centre will allow us to further develop hybrid bus technologies and cater to
Voith opens US hybrid centre
the specific needs of our customers who want to expand their use of this emerging technology. Above all, we are making an important contribution to the US economy by expanding the use of clean-energy technology in transportation fleets across the country.”
California-based Maxwell Technologies is to supply Voith with ultra capacitors; it already uses Maxwell to supply systems for its patented DIWAhybrid parallel drive system, which went into production last month. Voith has been working with Gillig to field test its parallel DIWAhybrid drive system and says the clean-energy technology in transportation aim of the Hybrid Power-Train Development Center to expand on DIWA and create new hybrid technologies for the US market.
Development SAMPLE
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Strategy
Kazakhstan / Turkey - Hakan Kefoglu, export director for the Kocaeli, Turkey-based bus and coach builder, Anadolu Isuzu (Anadolu Isuzu Otomotiv Sanayi ve Ticerat) speaking at Busworld Central Asia in Almaty last month said the company was actively looking to expand bus and coach sales in the region. With over 60% of its revenue in 2019 already being generated from export sales, he said, Anadolu Isuzu intended to increase this percentage even further in the coming years; in part by taking advantage of the free trade agreements between Turkey and the Commonwealth of Independent States (CIS), which offers it a competitive advantage compared with other European manufacturers based outside Turkey.
Kefoglu said Anadolu Isuzu already has 65 vehicles in operation in neighbouring Tajikistan and were currently the largest provider of buses in Azerbaijan, Kazakhstan’s neighbour across the Caspian Sea. Furthermore, he said, the company’s delegation in Almaty had had several productive meetings with transport officials representing Almaty and Astana during their time in Kazakhstan as well as with representatives from cities in Azerbaijan.
Kefoglu pointed out municipal and national tendering processes in Kazakhstan and other central Asian republics were inclined to give priority to manufacturers that build vehicles within their country or within the region. When asked if Anadolu Isuzu intended to set up an assembly or manufacturing facility in the region, Kefoglu said discussions were being held regarding CKD (Complete Knock Down)
Anadolu Isuzu focussing sales in Central Asiakit assembly, but nothing yet had been finalised.
For Kazakhstan and other countries central Asia, Anadolu Isuzu is focusing on sales of its 9.5m and 12m CNG buses. Whilst the overwhelming majority of buses sold in Kazakhstan are currently second-hand diesel buses, Kefoglu said municipalities across the country were looking to overhaul their fleets over the next five years, and can access an element of funding to achieve this through the European Bank for Reconstruction and Development (EBRD) and the International Bank for Reconstruction and Development ( IBRD) providing they acquire qualifying low-emission vehicles. Given the abundance of natural gas within Kazakhstan, and other countries in the region, Anadolu Isuzu (and other manufacturers) believe CNG-fuelled buses offer the best solution. In answer the prospect for electric buses, Kefoglu suggested the harsh and very climate conditions in Kazakhstan and the central Asia region presented real challenges in terms of maintaining the integrity of the batteries of an electric bus - notably the temperature range of the battery cells. Kefoglu added that Anadolu Isuzu were in talks with China’s BYD, regarding use of its NMC and Li-ion batteries, and the prospect of developing electric vehicles which could cope with the extreme seasonal temperature changes characteristic of the region. He also emphasised that Kazakhstan, and other Central Asian countries, had budgetary and infrastructural constraints which meant that the latest in electric vehicle technology was simply beyond the budgets of many municipal authorities and private operators.
Strategy / Export
Kazakhstan / Turkey - Otokar* of Sakarya, Turkey attended Busworld Central Asia held in Almaty, Kazakhstan at the end of June to showcase its products in a country and region where it sees considerable potential for export growth. Representatives at the show stated Otokar had already sold buses in Azerbaijan, and it currently has vehicles on trial in Georgia, and it is keen to expand into other countries in the region.
Emre Sarp, commercial vehicles sales and marketing group manager at Otokar said it was still evaluating its strategy for the region, but would work on the basis Central Asian Republics would, under incentives from the European Bank for Reconstruction and Development (EBRD) and the International Bank for Reconstruction and Development (IBRD), move towards adopting European emissions and safety standards. Should this happen, Sarp said, Otokar would be well-placed to make inroads into the market. Turkey, he added, has pre-existing bilateral free trade agreements with the constituent countries of the Economic Cooperation Organisation (ECO), of which most Central Asian states were members. Reduced trade barriers with and between ECO nations would put the Turkish Otokar at an advantage over other European manufacturers, which do not enjoy the same ease of access.
Otokar evaluating strategy for exporting to Central Asian region
Continued on p8
5 www.truckandbusbuilder.com Established 1978
Truck & Bus BuilderT&BB August 2019
Assembly / Agreement
Kazakhstan / China - Astana Motors of Almaty in March this year it had begun to assemble Chinese buses from Xiamen Golden Dragon Bus Co Ltd of Xiamen, according to Adilbek Gayev, the head of distribution for commercial vehicles at Astana at Busworld Central Asia in June. On display was the electric 12m XML6125CLE model. Equipped with a Lithium iron phosphate battery (LiFePO) battery (LFP 576 VDC / 540 Ah (311KWh)), it can carry 40 passengers up to 350km on a four-hour charge. It featured ZF RL82EC independent front axle and ZF AV 132 rear axle. The XML6125CLE, like most of Golden Dragon’s current range, has a monocoque body which has been electro-plated in a series of coats and polymers, thus increasing the strength and corrosion resistance of the body. Buses with this “e-coating” not only have decreased maintenance costs but are enabled to have lighter and thinner body frames – a particularly important consideration for electric buses.
In China, Golden Dragon has three manufacturing plants producing 40,000 units each year. Plans for the Astana plant are more modest: At present, Gayev indicated the Golden Dragon buses on display at the show were the only ones yet to have been produced at the Astana plant.
Astana Motors adds Golden Dragon to growing portfolio
However, Golden Dragon’s strong historical sales in the region do point towards demand for locally assembled Golden Dragon buses, which can be sold without tariffs within Kazakhstan, and exported without tariffs to other CIS countries.
The Golden Dragon brand is the company’s third foreign commercial vehicle brand that it is now assembling and distributing in Kazakhstan and the surrounding region. Astana Motors today is Kazakhstan’s largest vehicle dealership. Founded 27 years ago, it expanded into commercial vehicles in 2005, and currently claims to have a 26% market share for commercial vehicles in the country.
In 2011, it started assembling vehicles at its plant in Astana. Initially, it assembled Hyundai trucks and began assembling Euro IV and Euro V Hyundai County midi-buses the following year. In 2017, it expanded into assembling MAZ (Minsk Automobile Plant) trucks and heavy specialised vehicles. Assembling these units in Kazakhstan has allowed Hyundai and MAZ to gain a significant presence not only in the country, but also in the region: According to Astana Motors’s owner, Nurlan Smagulov, Hyundai is the second highest-selling brand of vehicle in CIS (Commonwealth of Independent States) countries.
Strategy / Export / Assembly
Belarus / Kazakhstan - Belkommunmash of Minsk, Belarus, a producer of trams, trolleybuses and more recently low floor full electric buses, used the inaugural Busworld Central Asia exhibition in Almaty, Kazakhstan to display two scale-models of its electric buses; the Electrobus E321 (a 12.2m, 18t gvw, low floor, three double-doors, 180kW motor and passenger capacity of 83 with 26 seats) and the Vitovt Electro E420 (a two-axle low-floor vehicle with two sets of double doors between the axles).
A spokesman for Belkommunmash at the show said it was the company’s intention to export more electric vehicles: This year it shipped four electric buses and two charging units to Uzbekistan and, by the end of the year it would also have delivered both electric trams and trolley buses to Uzbekistan. In the past year it has also shipped several electric trolley buses to cities in Moldova, Kyrgyzstan and St. Petersburg in Russia.
The spokesman also announced that in January this year, Belkomunmash had signed a manufacturing cooperation agreement with the Ganja Automobile Plant in Ganja, Azerbaijan. This agreement was for the delivery of four electric bus model E321 units in CKD kit form for assembly by the Ganja Automobile Plant for a pilot electric bus route in Ganja this year.
Belkommunmash’s recent growth in exports, the company said, was due to the company’s electric vehicle design and particularly for its inclusion of differential supercapacitors, made by Aowei. Whilst current electric bus models fitted with these supercapacitors have a limited range (for example, just 30km in its 8m model and 50km for its 10m model), Belkommunmash claims they have the advantage of being fully re-charged in just six
Local CKD assembly with Azerbaijan’s Ganja raises expectations of sales in Central Asia for Belkommunmash
minutes, making the vehicle highly suited to urban operations. Another advantage stated was that unlike batteries, supercapacitors don’t lose energy density with the number of charging cycles and so the supercapacitor is expected to last double the lifetime of batteries, offering an average of ten years of use (90,000 charge cycles) rather than five years with traditional / standard battery technology.
In order to expand its presence in Central Asia and Eastern European countries, Belkommunmash says it has created two types of hybrid buses. Its hybrid models use the same supplier for the batteries and supercapacitors, and the engines are manufactured and supplied by BelGee, a local Belarusian company.
Belkommunmash targets western Europe
Belkommunmash also announced at the show its intention to expand into the EU. It plans to unveil a new electric bus model at Busworld in Brussels later this year. It announced it has established a joint venture with an unnamed Polish company in order to lower the cost of entry into the European market. However, it is still to receive an EU certification for its vehicles.
Founded in 1973 to manufacture trams and trolleybuses, Belkommunmash began producing electric vehicles in 2016, and since then it has had considerable success within Belarus. Currently it has 80 full electric buses in operation in Minsk; 48, 18m articulated E433 Vitovt Max Electro buses and 32 shorter Electrobus E321 12.2m buses, as well as electric trolleybuses and trams in cities across the county.
Otokar evaluating export strategy for Central Asian region
Central Asian adoption of European standards wouldalso help Otokar compete with Chinese and Russian companies, which historically have dominated the region, stated Sarp.
Otokar’s model focus for the region would be midi-buses with either Euro-6 diesel or CNG engines, as well as 12m CNG buses for intercity travel. Sarp said Otokar was developing its new electric bus range for the European market - a 12m prototype made its inaugural display at UITP in June. However, he stated he did not see a large market for electric buses in Central Asia, which was for three reasons: The region’s extreme climactic conditions, the lack of appropriate charging infrastructure, and the comparatively smaller budgets of transport authorities in the region.
Otokar - Otokar Otomotiv ve Savunma Sanayi A.S., is known simply as Otokar. It is a Turkish bus and military vehicle manufacturer headquartered in Sakarya, Turkey and is a subsidiary of Koç Holding.
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Manufacture / Joint Venture
Turkey / Tajikistan / Kazakhstan - Akia Avesto Automotive Industry LLC (a joint venture company established in January 2018 between Akia Hess Otomotiv Karoseri Imalat San. ve Tic. Ltd (Akia) of Istanbul, Turkey and the Avesto Group (a diversified group of companies operated by the Tajik government for encouragement of foreign investment and technology in the country) of Dushanbe, Tajikistan, announced at Busworld Central Asia in Almaty, Kazakhstan that in June this year it had inaugurated a bus factory in Dushanbe, Tajikistan.
With an initial annual bus manufacturing capacity of 300 units a year, the Turkish company said it planned to increase sales in the region, and that this goal would be aided by its ability to build vehicles within the Commonwealth of Independent States (CIS) and thereby, avoid import tariffs part on vehicles built outside the CIS.
At the show it displayed three buses, an 8m (Ultra LE 8) 12m (Ultra LF 12) and a double deck; all featured Euro 5 Mercedes-Benz engines with ZF transmissions and axles. The Ultra LE-8, for instance, featured a Mercedes-Benz OM934 LA 5.1-litre Euro 5 engine, capable of generating 130kW output and 750Nm of torque, matched with ZF transmission and axles. It can accommodate 26 seated or 30 standing passengers.
At the show, while Serkan Denizmen, Akia’s Sales and Marketing Manager, acknowledged its buses carried a higher upfront cost, the high-quality level and lower maintenance and service costs over the lifetime of the vehicles meant a higher level of passenger comfort for a lower cost of ownership for the operator.
The joint venture operation of Akia Avesto has been established at a stated cost of 90 million Somoni (EUR8.5m) and was expected to generate work for some 200 people. It has six lines for production comprising welding, priming and painting, mechanical and electrical assembly, interior fitment and final quality control.
Local production in Tajikistan with JV partner expected to give Akia sales advantage in CIS countries