BYD and ADL strengthen links

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BYD and ADL strengthen links Escorted by BYD’s Founding Chairman Wang Chuanfu, Chinese President Xi Jinping boarded the bus, 100% designed and built by BYD, in the presence of the Duke and Duchess of Cambridge.

Single deck deal with potential for decker collaboration

When I spoke to BYD Europe MD, Isbrand Ho, during the Busworld exhibition, it was clear that he saw more opportunities arising from the new relationship formed between his own company and Alexander Dennis Ltd (ADL). It had already been announced that the two manufacturers are to collaborate on the construction of 51 single deck electric buses which are to be supplied to
Go-Ahead London for use on the 507 and 521 services, making the Waterloo depot allocation 100% electric. They follow two entirely BYD single decks that have been operating for the past
18 months and will have BYD chassis and ADL bodies and be completed in time to enter service in August 2016.

Isbrand Ho, Managing Director, BYD Europe commented, ‘This event really underlines that the era of electric buses has truly arrived.’

Isbrand Ho, Managing Director, BYD Europe commented, ‘This event really underlines that the era of electric buses has truly arrived.’

In a major extension of the original deal, a joint venture agreement has been signed which envisages an initial contract between BYD and ADL to build 200, 12-metre single deck buses a year, representing potential turnover of around £660m over the next ten years. Furthermore, the two parties have revealed that they are in advanced discussions with a view to extending their alliance to include double deck buses, the sector in which ADL is the world leader. If and when this happens, there is potential to triple the scale of the current deal to almost £2billion, which would represent a big step towards ADL’s aim of becoming a £1billion annual turnover business.

The basis of the deal, signed by Wang Chuan-fu, Founding Chairman of BYD, and Colin Robertson, Chief Executive of ADL, is that BYD will supply its Iron Phosphate battery and electric chassis technology and ADL its experience in bus bodybuilding. Final assembly of the complete buses will take place at the Falkirk plant in Scotland.

The announcement of the deal was made at Lancaster House in London last Wednesday (21st) during the State Visit to the UK of Chinese President, Xi Jinping. He joined Wang Chuan-fu, Colin Robertson, Prince William and the Duchess of Cambridge to inspect one of the first of the five full electric, completely BYD built, double decks that will shortly enter service with Metroline. Another of the buses was last week shown at the Busworld exhibition in Kortrijk.

Speaking at the signing ceremony, Mr Wang said: ‘Working with top industry partners such as ADL will enable us to speed up acceptance of our vision for fully-electrified public transport systems that can make a major contribution towards the clean air challenges facing cities around the world. ADL’s know-how and local market experience in the UK, combined with their global expertise in the double deck sector and our class-leading knowledge of electric technology, creates the perfect platform to jointly develop a range of cost effective, emission-free vehicles to suit every requirement.’

Colin Robertson commented; ‘This is the start of an exciting journey with enormous potential and we are delighted to be working with BYD. Their expertise in electric vehicle technology is second-to-none, while we have a global reputation for robust, reliable, high performance vehicles that deliver what they promise – and are backed by world-leading parts and service support, both in the UK and international markets. The combined strengths of BYD and ADL create a powerful new alliance and I look forward to our business relationship flourishing in the years ahead.’

Colin Robertson, CEO of Alexander Dennis Ltd (ADL) with BYD’s Founding Chairman Wang Chuanfu following the signing ceremony at London’s Lancaster House.

Colin Robertson, CEO of Alexander Dennis Ltd (ADL) with BYD’s Founding Chairman Wang Chuanfu following the signing ceremony at London’s Lancaster House.

Isbrand Ho had commented in Kortrijk, ‘The ambition of BYD is not only buses. It’s about transforming the whole of Emobility in society and moving it towards much greener, more power battery driven vehicles. Our E-Refuse vehicles, E-tipper trucks, E-Street Cleaners, is where we are going, but before that happens we already have our E-taxis and E-Forklifts. We’re not here to conquer the British market, we’re here to make sure we’ve got the right partner to spread the gospel with us.

‘You walk around the exhibition (Busworld) today and you see a lot of manufacturer OEMs who put one electric bus on their stand, and say ‘we have it too, by the way’, but, ask them how many vehicles do they have deployed on the streets? Without having the vehicles on the streets and having the hundreds of millions of kilometres logged, how do you know how good your product is? We have learned our lessons, we have learned from the two buses we have in London on the 507 and 521. We’ve learned about some mistakes, for instance the battery stacks next to the entrance areas. We’ve learned about complaints about the noise because of the high frequency pitch versus the low frequency drumming or rumbling of the diesel engine, so we are making a different approach to filter out rather than absorb the noise, we are deflecting the noise right now. These things we have learned from listening to the customers. The ADL alliance is extremely important to us because, how do you beat 75 years history of bus building? You can’t. How do you beat understanding the local legislation? I’d rather concentrate on what we know best, the battery power system and the control system, working with a very credible partner.’

‘I think this is the right way to go, we’re very excited about this partnership. I think what is important is the people standing behind the contract. That really matters. Since we have talked about the collaboration, we’ve had at least ten exchanges, with ADL coming to China and Chinese delegations in Edinburgh, understanding the mentality and history of the company, the strengths and weaknesses, the areas of collaboration. I think that speaks volumes. Some people sign contracts and have never even visited each other. As we speak today, there are about 15 of our engineers in Falkirk. I think
it’s very important that we continue with this relationship and we look forward to extending it beyond just buses.’

ADL and BYD’s initial collaboration will deliver 51 single deck electric buses based on the Enviro200 MMC body structure to Go-Ahead London.

ADL and BYD’s initial collaboration will deliver 51 single deck electric buses based on the Enviro200 MMC body structure to Go-Ahead London.

He also suggested that there was potential for the electric system within the coach market. ‘We think that in London, with the current price of diesel, we are looking at break even in four years comparing a diesel bus and an electric bus. If you want to drive 300 miles or 400 miles, then the break even period is even shorter. If you run a coach from Birmingham to London and back four times a day you are talking about 800 miles, and for that the break even could be even less than a year. That could be a very interesting financial proposition for the operators. It can be done. We are already running electric coaches between two cities; Zhuhai (next to Macau) and Shenzhen, where our head office is. We want to make sure that it’s workable because bus operators and coach operators as well are talking about TCO, total cost of ownership.’

Interestingly, BYD also showed a small midibus at Kortrijk. Although this was to a Chinese specification, BYD has made it clear that it will be developed and fully homologated for Europe. You would think this might be another direction in which the alliance could go. ADL has massive midibus experience and know-how.

And as Isbrand Ho commented, ‘Whose to say it’s not possible to build ADL buses over at the BYD factory. So a lot of discussions are taking place right now.’

Continuing activity

Despite the new deal with BYD covering electrics, ADL will continue to offer and develop other alternative propulsion systems including the established hybrid programme in conjunction with
BAE Systems and the gas bus technology provided in conjunction with Scania, as well as its Cummins powered diesel options. It will also continue all of the other alliances it has forged around the world.

BYD has other existing manufacturer partnerships having launched the new Denza brand for the Chinese car market in March 2012 in conjunction with Daimler AG.

Last word

The deal makes a lot of sense for both companies. BYD’s strength is in the electric technology but the buses it has produced thus far have been let down by the quality, layout and finish of their bodywork. Innovative and groundbreaking though it is,
even the latest all electric double decker is not up to the body standard routinely supplied by the UK manufacturers, with a relatively narrow staircase, finish issues and lacking some  the design flair seen in the latest generation E400H City launched by ADL in Birmingham.

For ADL, which is committed to moving towards an electromobility goal, it is teaming up with a committed partner with working technology and a worldwide presence. There is currently no bigger player in the electric bus market. Though good at exploiting niche markets, such as those for double deck applications, ADL cannot hope to take on the big European manufacturers in their core solo citybus and articulated citybus markets, but in conjunction with BYD the scope to get into additional markets is immense, not just in Europe but elsewhere too. In the medium term there may be a risk of substitution sales in markets such as Hong Kong where ADL is very strong, but Colin Robertson will have gone into this with his eyes open and obviously believes the potential advantages are there to make this a good next step for ADL’s growth.

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