Alexander Dennis revs up for £60m bus deal in New Zealand

SCOTTISH bus builder Alexander Dennis is on the verge of signing a £60 million order for 300 vehicles for the New Zealand market as the Falkirk-based firm continues its international expansion.

The company will next week deliver the first of 118 buses to Auckland-based Swift Transport for its NZ Bus subsidiary, with the chassis and bodies built in Scotland and then assembled "down under".

The Scotsman has learned that the Scottish firm, which is the UK's biggest bus builder, is already in talks to supply Swift with a further 300 buses over the next three years.

Alexander Dennis is expected to see turnover hit 360m this year, against 170m in 2007, on the back of its rising global sales in Asia and the Antipodes.

The firm employs about 2,000 staff directly and supports a further 4,000 posts through its supply chain.

The initial contract with Swift was supported with a credit guarantee from the UK government's Export Credits Guarantee Department (ECGD), which allowed ANZ National Bank to loan Swift cash to fund the NZ$45.8m (22m) purchase.

Alexander Dennis commercial director Robert Davey praised the ECGD for its "minimum of bureaucracy" and for "recognising the need for urgency" to complete the deal.

A lack of credit guarantees has been one of the big stumbling blocks for exporters highlighted by the British Chambers of Commerce in recent years.

Davey said: "There is no doubt that ECGD played a significant role in us penetrating this important new market.

"It is clear the UK government, through ECGD and other departments, is prepared to put its money where its mouth is when it comes to helping UK companies access new export markets.

"We have an opportunity to change the transport landscape in Auckland and across New Zealand. Our new-build partnership with Kiwi Bus may also provide the gateway to Australia."

Buses assembled by Alexander Dennis in New Zealand have the potential to be exported to Australia with fewer import tariffs than if the vehicles came directly from Scotland.

ECGD chief executive Patrick Crawford said: "I'm very pleased that ECGD's support helped Alexander Dennis to conclude this important deal.

"Alexander Dennis beat several other companies - including MAN and Scania - and hopefully this success will act as a break-through for them in both New Zealand and Australia.

"This shows how ECGD's support can help UK exporters bring home significant deals in markets across the world."

In March, Aberdeen-based transport giant FirstGroup awarded a 160m contract for 955 single- and double- deckers to Alexander Dennis and Northern Ireland's Wrightbus. The order included 40 hybrid vehicles for Glasgow, Leeds and Manchester.