Saudi Arabia aims to build buses, operate toll roads

Daimler last May won an order from Riyadh for 600 Mercedes-Benz Citaro buses, the largest order for the vehicles in the history of its bus division. (Photo courtesy of Daimler)
Updated 07 May 2018
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Saudi Arabia aims to build buses, operate toll roads

  • Toll road plan under consideration
  • Kingdom looks to cut imports and boost manufacturing

RIYADH: Saudi Arabia has held preliminary discussions with foreign firms about manufacturing buses domestically and plans to convert part of its highway system into toll roads to help make its transport system more efficient, the transport minister said.

“We are developing the public transport system with a lot of buses, so we want to see how we can leverage this to develop domestic industry,” Nabeel Al-Amudi said in an interview on the sidelines of a business conference in Jeddah on Sunday.

He declined to name the companies with which Saudi Arabia had been talking.

The Kingdom, which does not have a significant auto manufacturing industry, is spending billions of dollars to expand public transport systems in the capital Riyadh and other big cities, and has imported thousands of buses in the last few years.

Last May, German vehicle maker Daimler received an order from Riyadh for 600 Mercedes-Benz Citaro buses, the largest order for the vehicles in the history of its bus division. China Yuchai International last month announced the delivery of 800 buses to Saudi Arabia.

Producing the vehicles locally would allow Saudi Arabia to save on import costs while creating jobs and expanding domestic industry — key goals of an economic reform program designed to reduce the economy’s dependence on oil exports.

Amudi said the potential bus project was separate from a memorandum of understanding signed by Toyota Motor Corp. in March last year to conduct a feasibility study on producing vehicles and parts in Saudi Arabia.

The reform program features plans to have the private sector operate much of the Kingdom’s transport infrastructure, including airports and sea ports, with the government keeping a role as regulator.

Amudi said that approach would be extended to the highway network.

The government hopes to establish between four and six toll roads which private companies would operate in exchange for fees, although this may be difficult because of the need to give road users the option of taking a non-toll route in each case, Amudi said.

Draft plans for this project may be ready in six months, he added.


Tesla plans 7% staff cut as CEO Elon Musk says company must ‘work harder’

Updated 10 min 7 sec ago
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Tesla plans 7% staff cut as CEO Elon Musk says company must ‘work harder’

  • Tesla delivered over 245,000 electric cars and SUVs last year, nearly as many as all previous years combined
  • But its 2018 production fell far short of a goal set nearly three years ago of manufacturing 500,000 vehicles for the year

Saying the road ahead was “very difficult,” Tesla’s CEO Elon Musk said Friday that the company would be cutting its staff by about 7 percent.
The electric car and solar panel maker notified its employees about the staff cuts and other plans in an email posted on Tesla Inc.’s website.
Musk said Tesla hopes to post a “tiny profit” in the current quarter but a 30 percent expansion in its workforce last year was more than it can support.
Tesla’s shares tumbled earlier this month after it cut vehicle prices by $2,000 and announced fourth-quarter sales figures that fell short of Wall Street estimates.
“Our products are too expensive for most people,” Musk said in the memo to Tesla staff, saying the company has to “work harder.”
“Tesla has only been producing cars for about a decade and we’re up against massive, entrenched competitors,” he said.
Musk said in a tweet in October that Tesla, based on Palo Alto, California, had 45,000 employees. A 7 percent cut would involve laying off about 3,150 people.
“We unfortunately have no choice but to reduce full-time employee headcount by approximately 7 percent ... and retain only the most critical temps and contractors,” he said.
The company says it delivered over 245,000 electric cars and SUVs last year, nearly as many as all previous years combined. But its 2018 production fell far short of a goal set nearly three years ago of manufacturing 500,000 vehicles for the year. That goal was announced in May of 2016 based on advance orders for its mid-range Model 3, which Musk said sells for $44,000.
Musk said Tesla plans to ramp up production of the Model 3, “as we need to reach more customers who can afford our vehicles.”
“Attempting to build affordable clean energy products at scale necessarily requires extreme effort and relentless creativity,” he said in the memo, “but succeeding in our mission is essential to ensure that the future is good, so we must do everything we can to advance the cause.”
Tesla broke ground earlier this month for a factory in Shanghai, its first outside the US. Musk said it plans to begin production there of the Model 3 and a planned crossover by the year’s end.
Tesla and other global automakers including General Motors Co., Volkswagen and Nissan Motor Corp. are pouring billions of dollars into manufacturing electric vehicles in China.