THE delay in awarding bus contracts to meet demand for the 2010 Soccer World Cup is causing concern for local bus manufacturers, who warn that the longer they have to wait, the more strain it will put on delivery and that necessary job training will suffer.

Thomas Hemmerich, chief executive of MAN Truck and Bus, said it was critical that orders were placed with bus assemblers in the next two to three months if up to 1500 buses were to be delivered on time.

Hemmerich said the sale of around 50 buses a month, manufactured by MAN, had all but ceased and stocks are building up.

Geoff du Plessis, former CEO of MAN Truck and Bus and now head of MAN Truck and Bus UK, said at the Johannesburg International Motor Show at the end of October that the delay in awarding bus tenders could negate the job-creation and skills training that would be required. It was also reported at the motor show that it takes up to 800 man-hours to build a commuter bus and double this for a luxury bus. It was vital that tenders are awarded by the national department of transport so that assemblers could begin the process for delivery.

At the end of last month, the mayor of Johannesburg, Amos Masondo, announced that Scania had won the contract for the supply of 143 buses for the Rea Vaya Rapid Bus Transit system. Deliveries of 102 complementary buses and 41 articulated buses will begin in the first week of April and be completed by the middle of June.

While Scania has the capacity to assemble the buses and Marcopolo the bodies, the late granting of the bus contract will mean that all will be imported from Brazil fully built up.

Kobus van Zyl, vice president of commercial vehicles at Mercedes- Benz, said the company had taken note of the recent tender that had been issued.

He added that the group had invested significantly in people, infrastructure and skills and will be able to follow all possible opportunities in the market. The company expects to benefit from its local production and BEE profile.

Eduard Chvatal, CEO of Iveco, said although the initial tenders had been issued several months ago, more than 1420 buses would be needed by early next year to meet demand. An order of this size would represent a full year’s production from a major plant in Europe.

He added, though, that the longer manufacturers had to wait, the longer it will take to deliver and the less time there will be for training drivers.

Several buses from the Orient will also be offered as possible candidates for 2010. Hyundai will provide the Universe bus, the China Motor Corporation will import the Yutong bus. CAM will bring in the Xiamen bus from China and Tata will introduce two new buses, one of which is a luxury model.

PUBLICATION: Business Times
AUTHOR: Don Robertson
DATED: 9th February 2009