60 | Challenges ahead for company Managing Director of Kiwi Bus Builders, Richard Drummond, warns of challenging times ahead for the manufacturing sector. MANUFACTURING Kiwi Bus Builders Sue Russell Tauranga-based Kiwi Bus Builders will this year, blow out 30 candles. Three decades spanning huge changes, challenges and opportunities, says Managing Director Richard Drummond. “It is difficult at this time to be optimistic for the local industry. We were this country’s largest manufacturer of commuter buses and tour coaches. In the urban/city bus operations there is a lack of will/ability by both Central and Local government to rise to the level of investment required to match their climate change, clean green narrative and Government set targets. Scarily for the industry and local manufacturers there is a current Government preference to fund overseas manufacturers. Government is funding overseas manufactured, massively heavy electric buses. These are causing extensive damage to the roading network, now concerning local councils as they have to pay for the damage. Not one to mince words, Richard gives a recent example of this, in the form of New Zealand Green Investment Finance Fund, established by Government to accelerate investment that helps reduce greenhouse gas, deciding to invest $20million in 18 buses and infrastructure for Christchurch. “It’s extremely disappointing to have a visit from Minister for Climate, James Shaw, to our factory one day and find out the next day that this decision had already been taken and announced,” says Richard. “Building tour coaches again is going to happen again one day. But one day isn’t concrete enough to plan and invest. There was a time when Kiwi Bus Builders employed 220 staff building 150 buses a year. A major project building 31 electric double-decker buses for Tranzit to operate in Wellington, has carried the business through these tough times. Today, the company employs 55, with nearly one-quarter of the staff as apprentices. “In fact the whole national manufacturing sector is just stuck in my opinion. Enticing staff from companies with higher pay seems to have stopped. So the ability to increase charges in for manufacturing has hit the top of what the buyers can pay. From here lesser or no margins will be the go forward. I foresee that you just won’t be able to have many goods produced, serviced or repaired, as it will be commercially not possible to do it. This is already happening. “ And frustratingly, a recent opportunity to take up a large contract, slightly out of Kiwi Bus Builders’ main business, has been turned down, simply given the uncertainties of employing sufficient staff to see the contract completed on time. So, meeting the current climate head-on has meant a shift away to local service manufacturing. The company operates from a purpose-built facility at Tauriko, Tauranga’s new industrial precinct. It moved on to the site in Easter 2011. “This space is one of the best in the world for what we do. It is not just one long production line. “We’ve evolved areas off to the side where complete bus components are completed rather than having the bus built from scratch on the one assembly line. “It’s proved a game-changer in terms of efficiency and output. We have the ability to compete with overseas bus builders, removed from New Zealand participation. The Government has set targets that all urban buses must be fossil free by 2035. Currently in Auckland all buses going into their urban fleet must be fossil free. Be it new or replacements. Electric buses being the preferred option at this stage as hydrogen infrastructure is still in its infancy. Richard explains that a rule exists around requiring refurbishment of an urban bus after 10 years, half-way through its life. He doubts this is happening today with many regional councils not enforcing it. “It’s just another example of why the sector is suffering. “A regulated refurbishment is required, was factored into costings, but is not being enforced by many regional councils.” Design & Manufacture of Doorgear, Windows & Roof Hatches for Public Transport Fleets. Wheelchair Ramps. Tel: 09 444 4510 www.johngilbert.co.nz Proudly supporting Kiwi Bus Builders TRANSIT DOOR & WINDOW SPECIALISTS YOUR CONSUMABLES PARTNER ESHOP.WURTH.CO.NZ | SALES@WURTH.CO.NZ | 09 262 3040 BAY SANDBLASTING the same for the last 38 years but a little different. admin@baysandblasting.co.nz | 07-575 6641 | 2 Maru St, Mount Maunganui, Tauranga
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