MUSCAT, DEC 5 - Prominent Chinese bus manufacturer Higer has been named the technology partner for the Karwa Motors project — an Omani-Qatari joint venture due to be established at the Special Economic Zone (SEZ) in Duqm.
Karwa Motors is a joint venture partnership between Mowasalat Qatar — the national transport company of Qatar (with a 70 per cent equity stake) and Oman Investment Fund (OIF), a sovereign wealth fund of the Sultanate of Oman (with the remaining 30 per cent stake).
Investment in Phase 1 of the project is estimated at $90 million.
Higer Company Limited, based in Suzhou (Jiangsu Province), manufactures and exports buses and coaches to more than 100 countries and territories across South Asia, Middle East, Africa, Russia, East Europe and the Americas.
Its roughly 1 million sq metre manufacturing facility in Suzhou rolls out an estimated 35,000 units of coaches, city buses and commuter buses annually, generating sales revenues in excess of 11.7 billion yuan ($1.8 billion) in 2015.
As Technology Partner, Higer will supply Completely Knocked Down (CKD) units of the buses and coaches due to be assembled at Karwa Motors new plant at Duqm. Higer will also support the training of Omanis in various technical positions that will become available when the plant comes into operation in 2020. Knowhow transfer is another key spinoff from this arrangement with Higer. Details about the Chinese automotive brand’s leading role in the operational phase of Oman’s first bus manufacturing venture were unveiled at a well-attended cornerstone laying ceremony of Karwa Motors at the SEZ last week.
Present were Yahya bin Saeed al Jabri, Chairman of the SEZ at Duqm (SEZAD); Salim bin Mohammed al Nuaimi, Transport Affairs Under-Secretary of the Ministry of Transport and Communications; and leading figures from the Wilayat of Duqm. Also in attendance were Khalid al Hail, Chairman of Karwa Motors; Nasser bin Mohammed al Malki, Chairman of Mowasalat Qatar, and Khalid al Yahmadi, Chief Executive Officer of Oman Investment Fund (OIF) who is also Vice Chairman of Karwa Motors.
Speaking at the cornerstone-laying ceremony, Khalid al Hail, Chairman of Karwa Motors, said: “This project represents the future vision of the leaders of Oman and Qatar in realising the socioeconomic ambitions of the two nations, as well as aspirations for growth of the their peoples. It marks the culmination of two years of efforts by the joint venture partners leading to today’s foundation-stone laying ceremony.”
The project is being built on a 220,000 sq m site that will be suitably designed to manufacture coach buses, city buses and school buses tailored for the local and regional markets. Phase 1 however will be equipped primarily for welding, painting and assembly of buses and coaches. But over time, the project is expected to attract investors setting up workshops and ancillary plants that will supply components and parts to Karwa Motors — a move that will spark the growth of an automotive manufacturing hub in Duqm.
Production is initially envisioned at 1,000 units per annum of coach buses, city buses and school buses. This will be progressively ramped up to 3,000 units in stages in line with market demand, with total investment in the project rising three-fold to an estimated $270 million at full capacity, the Chairman said.
Around 200 jobs will be created during Phase 1, which may double after the expansion with the addition of R&D, design, parts manufacturing and global marketing units, he noted. “This plant will enable Karwa Motors to sell buses in the largest market of the MENA region while providing greater flexibility for Oman and Qatar. Worldwide demand for buses is growing and this is the first step towards becoming a leading regional bus manufacturer,” said Al Hail.
“Karwa Motors will leverage Oman’s existing automotive supply chain network to gain a foothold in the Oman and Qatar markets, which is tipped to become the region’s largest by 2022,” he added.
Conrad Prabhu
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