The case of Alexander Dennis, the bus builder based in Falkirk now expected to axe 650 jobs, highlights the need for government to think big about how it tackles this economic crisis. Alexander Dennis is the leading bus manufacturer in the UK, and a world leader in double-decker bus manufacturing. It has developed the ability to produce hydrogen-powered buses, all-electric buses, has done trials in autonomous, self-driver buses. It is one of the biggest employers of manufacturing jobs left in Scotland and probably one of the most strategically important, given the need for a zero-carbon transition which prioritises clean energy public transport.
It has also been a hugely successful firm until Covid-19, exporting as far away as Hawaii and Hong Kong, and was sold to a Canadian firm in May last year, NFI, for £320 million. The changes announced by Alexander Dennis is part of a wider restructuring of NFI including at its US and Canadian plants. As demand from private bus operators for new buses collapses in wake of Covid-19, NFI is eyeing job cuts internationally.
However, just because private bus operators aren’t investing, it doesn’t mean investment is not dearly needed. 70 per cent of UK buses are still running on diesel. Data last year from Transport Scotland showed bus use had fallen 7.5 per cent in five years, while prices were up 18 per cent over the same period. Meanwhile, the use of motor vehicles reached new peaks. The need for change in Scotland’s transport sector, the single biggest carbon emitter, was clear well before Covid-19. Now it really is an emergency.
So what is to be done? Alexander Dennis have an idea. Outgoing Chief Executive Colin Robertson has suggested that government could buy their buses rather than private operators.
He said: “We have a fantastic product line-up from the ultra-clean diesel through hybrid, through battery-electric. We have the infrastructure and experience. We’re in the right place, provided government move quickly.
“The UK typically orders 3,000 buses each year to keep an average age of eight years. With the green agenda, with battery and zero emission technologies, you could argue now is the time to accelerate that investment. And that certainly, in the near term, needs to be supported by government, because operating companies which have traditionally bought their vehicles are effectively standing still until they see how ridership comes back to their business models, post-Covid.”
That’s certainly one approach, but then what does the government do with all these shiny new buses? Surely not just hand them over to the Brian Souter’s of this world? Ever since Margaret Thatcher privatised bus services in 1986, bus companies (which are largely the only operator on their route; the idea of market competition in bus service delivery is ludicrous) have benefited from years and years of massive public subsidies, including in this crisis. Paying for all their future infrastructure costs would take socialising the costs and privatising the profits to a new pandemic extreme. Public ownership of the buses is a popularidea.
So governments (remember, in Scotland transport is devolved) should be asking deeper questions about the sector right now. If they are serious about a zero-carbon transition then affordable, high-quality, clean energy buses are an absolute must in cities. But even that won’t be enough alone to tempt many people back on to the bus, if they think there is a risk of infection. Now is the perfect time for an infrastructure upgrade in the country’s buses from the perspective of designing a model geared around public safety from transmission as well. The alternative is that the trends away from buses towards cars that was evident pre-crisis accelerates, a disaster from the perspective of the environment.
Another way of broaching this issue could be to look at the skills on offer at Alexander Dennis’ Falkirk site and think about what Scotland needs over the next ten years in terms of delivering a Green New Deal. The Falkirk plant could be nationalised and act as the basis for a bigger public transport manufacturing firm which also looks at moving HGV, forklift trucks, large agricultural vehicles to hydrogen.
“Scotland will require 20 to 30 large truck depots providing hydrogen refuelling,” Common Weal’s Common Home plan for delivering a Green New Deal in Scotland finds. “A National Transport Company should identify suitable locations for these in Scotland and build them. These will also fuel smaller long-range vehicles. Assuming 30 depots in Scotland, a cost of £600m is estimated. Some buses will run on electric and others on hydrogen. Local authorities taking control of bus services should plan accordingly for appropriate charging and hydrogen production infrastructure. The existing hydrogen bus manufacture industry in Scotland should diversify.”
The capabilities at Alexander Dennis is a perfect example of the huge gap between use value and exchange value in this crisis. To put it simply, the workers at Alexander Dennis produce things that society desperately needs, but that capital doesn’t currently want to pay for. That problem can be resolved by socialising the production and service-delivery of Scotland’s buses. Alexander Dennis is an important test-case of whether the Scottish Government really do understand that this crisis cannot be business as usual.
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