Dennis gears up on Stagecoach's £50m bus order

The Falkirk manufacturer, whose 900 Scottish workers were on a three-day week earlier this year due to weak demand across the industry, has secured the lion's share of the work on the Stagecoach order for 340 vehicles.

The latest orders by the Perth-based transport group take its total investment in new vehicles for the UK for the 2010-11 financial year to more than 65m and to 260m in the past four years.

The buses and coaches will go into operation on the firm's provincial bus routes across the UK later this year and during 2011.

Les Warneford, managing director of Stagecoach UK Bus, said: "We are committed to driving up the quality of travel for our passengers by investing millions of pounds each year in greener vehicles, better facilities and improved services.

"This latest investment is a sign of our confidence in future demand for bus travel. We believe continued investment is vital to attract even more people on to our greener, smarter bus services."

Bill Simpson, corporate affairs director at Alexander Dennis, said the orders represented a significant achievement at a time when bus and coach business in the UK was down more than 40 per cent year-on-year.

"We have a very strong working relationship with Stagecoach and these latest orders, won in the face of fierce competition, demonstrate the quality of our vehicles and our ability to deliver on time," he said.

The latest order includes 133 Alexander Dennis single and double-deck buses and 76 of the company's midi-buses. The Falkirk site, where workers returned to a five-day week in April, manufactures bodies for the vehicles.

The facility will also be involved in bodywork for 17 coaches to be supplied by Alexander Dennis's Plaxton arm and for the 100 Scania double-deck buses which also form part of the order. The remaining nine vehicles in the order will be manufactured by Lancashire-based Optare.

Although overall UK demand in the bus industry is significantly down amid nervousness among public transport fleet buyers over large expenditure programmes, Simpson said the latest orders were evidence the firm was "riding a depressed market".He said the firm was also seeing success in export markets including North America and Hong Kong and that its new hybrid vehicles, which have 30 per cent less emissions than standard vehicles, were attracting considerable interest across the world.

In June, the first of 56 electric-hybrid buses ordered by Stagecoach and part-funded by a 5m support package from the Department for Transport's Green Bus Fund went into service.

Alexander Dennis was bought out of administration in 2004 for 90m by Souter Investments, the family investment vehicle of Brian Souter and his sister Ann Gloag, Sir David Murray and merchant banker Angus Grossart.

Although Souter is also chief executive of Stagecoach it is understood his involvement in Alexander Dennis has no bearing on the transport group's fleet buying decisions.