Wednesday 27 January 2010

IRs driving demand for China-made buses

More and more China- made buses are plying Singapore roads, with demand being fuelled by the Integrated Resorts (IRs).

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Guanyu said...

IRs driving demand for China-made buses

China bus brands accounted for about two-thirds of private buses sold last year

By SAMUEL EE
27 January 2010

More and more China- made buses are plying Singapore roads, with demand being fuelled by the Integrated Resorts (IRs).

There are nine China bus brands in Singapore and together, they sold 148 units last year, or almost two-thirds of the total estimated 230 large private buses sold in Singapore in 2009.

Of these mainland makes, the top brand is King Long with a market share of 40 per cent for its segment. The Xiamen bus manufacturer produces 23- to 49-seater models and last year, it sold 61 buses here to major local transport operators who service the IRs.

‘Our clients began buying our buses as early as in the third quarter of 2008, when construction of the Marina Bay Sands and Resorts World Sentosa began,’ said Charles Tan, director of King Long (Singapore) Pte Ltd, a subsidiary of Goldbell, the long-time distributor of Mitsubishi commercial vehicles.

Mr. Tan said the buses then were used for ferrying construction workers and other staff on training. Those purchases of more basic buses are now giving way to more luxurious models, with specifications like reclining seats, LED lighting, flat-screen TVs and DVD players. He estimates that at least half of his buses bought last year serve the IR.

Even as King Long speeds ahead, another China brand is revving its engines as it prepares to supply the IR fleets.

Golden Dragon Coaches Pte Ltd, the distributor of Golden Dragon buses, has been preparing for an IR tender over the last two months. Managing director John Ng said the requirement is for 20 buses which can seat 30 to 40 passengers.

‘These are luxury buses with fewer and bigger seats for more comfort,’ he explained. ‘There is also a hi-fi and TV with more classy interior.’

Also on order are 20 to 40 units of the Golden Dragon VIP MPV model, which can seat five to seven people. Mr. Ng said these will be used by the IRs for airport transfers. In addition to direct purchases, the IRs are also creating spillover demand. Mr. Ng said school bus operators are also preparing to change their buses because these companies also tender for IR transportation jobs.

‘The market is quite big and includes school bus operators who want to change their buses because the IRs don’t want to see old buses being used for their jobs,’ said Mr. Ng.

Since 2007, the Golden Dragon brand has put almost 100 units on the road here.

The newest China brand on the market, Foton, is not directly targeting the IRs although it expects its bus operator customers to be engaged by the IRs.

‘Our buses will eventually serve the IRs because those who buy from us are the logistics people with the contacts and network to run the routes that the IRs require,’ said Paul Ng, general manager of Foton AUV Singapore Pte Ltd, the distributor of Foton buses.

The Beijing-based brand was launched here last month and has already sold 30 buses. ‘Our buses are custom made, so if the bus operator gets the IR account, we can spec to the required equipment level,’ added Mr. Ng.

The main allure of the China-made bus is its lower price and maintenance. According to Mr. Tan, King Long is China’s top brand and the most expensive, yet the price of a 49-seater luxury coach ranges from $145,00 to $235,000, including COE. A similar model from a European brand can cost $65,000 extra.

Little wonder then that from zero in 2007, China- made buses now account for 64 per cent of its segment after just three years.

The Chinese bus is also ‘a reliable product’, claims Mr. Tan. For King Long, China is merely used as a production base because of lower costs but the key components of a King Long bus come from Europe.

‘The engine is from the UK, and the transmission, power steering and brakes are from Germany,’ said Mr. Tan.

Guanyu said...

He added: ‘Although it is a China-assembled bus, we pay special attention to the look and feel because of driver and passenger comfort. If it is difficult, the driver won’t like it. That is why our clients who have used our buses have confidence in us.’