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Optare on green bus mission

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Optare's recently-appointed CEO Jim Sumner says the Leeds and Blackburn-based bus builder is aiming to be a "global leader in green bus technology". He has ambitious plans to develop low-carbon bus technologies for the UK and export markets.

And as the company that has developed an all-electric, zero emission midibus, Optare already has strong environmental credentials. However, on hybrid buses, Sumner is unconvinced, seeing it only as an interim stage. "The cost-benefit analysis for hybrid in the bus industry doesn't work," says Sumner. "Thirty per cent fuel reduction will only be achieved in some cases and that is still not enough to justify it."

Challenging remarks from a company which is already in the hybrid market with its Tempo and Versa buses in London. And Sumner has also had something of a rethink on the company's integral hybrid double-deck. Launched as the Rapta at last November's NEC show, the name has been dropped as there are some "problematic translations" into other languages and the whole project now appears to be under review.

Sumner recognises that given the state of the market this year , it is perhaps not the best time to launch a new double-deck product. And since Optare is working on Boris Johnson's 'New Bus for London', it makes sense to wait until the position is clearer on future vehicle specifications for the capital. In other words the integral double-decks originally scheduled to appear later this year are now unlikely before 2010.

Optare is making a virtue of its focus on customer choice in the power arena. When the SCR and EGR scenario emerged at Euro 4, it offered customers alternative options, adding MAN to its offering of Cummins and Mercedes engines. It believes that this strategy will also work when it comes to alternative power sources.

"We're not going to be backing just one horse," he says. "Our customers will make the choice."

Sumner points to the design feature of the Solo and Versa which has its power pack on a removeable cradle. This enables easy switching of the engine and has already been utilised in equipping the Solo EV with its electric motor.
Sumner hints that his agenda on green bus technology will be focussed on the whole vehicle parque, not just new vehicles, so the re-engining option is likely to feature strongly in its pitch for sales of new and emerging low carbon technologies.

Export markets are also likely to figure on Optare's green marketing agenda. Sumner says that he is targeting the USA, continental Europe and the World Cup in South Africa next year for low carbon buses. "We need to generate a level of exports to balance the UK market in what will be a very challenging couple of years ahead," he says. "But it will be more targeted and focussed as we simply can't afford the global marketing campaigns of the major OEs."

Sumner expects to announce the first orders for the Solo EV electric bus in the USA or continental Europe. The UK market is interested, he argues, but buyers are likely to wait until the full details are fleshed out for the government's recently-announced £30million fund for low carbon vehicles.

Sumner has joined the Optare business at a tough time. Following closely on the company's "year of consolidation" as it brought the former Darwen/East Lancs, Leyland Product Development and 'old' Optare together, has been the recession and the resulting rapid fall-off in future orders for buses.

As Bus and Coach Professional goes to press, Optare is about to confirm that the number of job losses at Blackburn will be far less than the original estimate of nearly half the 320-strong workforce.

Optare's production programme for the third quarter of 2009 is now full and the fourth quarter looks a good deal better than it did two months ago, according to Sumner.

A major exercise has been conducted at the Blackburn plant to bear down on work-in--progress and inventory stocks, resulting in much faster build times - down from six weeks to three weeks for double-decks. And as well as keeping customers happy with quicker deliveries, the new processes also mean that the company has freed up around £7million worth of cash. In addition, Optare says that it is looking at sourcing more components from low-cost countries to reduce ongoing material costs.

Coming from Leyland Trucks, Sumner is keen to introduce proven techniques in automotive manufacturing. "The bus industry is some way behind the truck side when it comes to customer service and quality and reliability issues," he says.  "On innovation Optare is a leader, but on quality we have been pretty average. Now we are aiming to set the benchmark for quality in the industry".

The techniques employed at Blackburn will also be used at the Leeds plant, which since the closure of Rotherham this month, is now the only other production site. However Rotherham is still the home of Optare Product Support.
Sumner is aiming to achieve an outcome where all bus models can be built at either Blackburn or Leeds in order that the company retains maximum flexibility to meet any order mix.

Flexibility is an important word in Sumner's lexicon. He believes that it is one of the two key issues that will determine the winners in today's bus manufacturing environment - the other is maintaining the lowest possible break-even point.
Sumner points out that modern manufacturing techniques enable a company to be both flexibile to customer requirements while also maintaining high levels of efficiency.

Earlier this year Optare dropped its plans to move to a new factory in Blackburn and while Sumner says that he doesn't rule out looking at this again in a couple of year's time, he stresses that it will be in the local area since that is where its skills base is.

Sumner has moved quickly to re-shape his management team in a number of new appointments, with the most significant being the return of Optare founder and former chairman Russell Richardson who will provide consultancy assistance on new product development. Richardson will work with Terry Gallagher who is the new engineering director, replacing Mark Houlton who is off "to pursue other interests". Two others returning to the Optare fold are Rick Betton who is heading up the Optare Direct sales operations to smaller independents following the ending of the relationship with Mistral, and Richard Matthews who becomes parts sales director.

Mark Wallis has been appointed to the new role of customer service director and has the pleasant task of composing a daily email to Sumner alerting him to any customer issues across the network. Wallis' appointment coincided with the departure from the company of Ritchie Bignell who lasted only a short time as product support director.

Sumner has also put his money where his mouth is as he and chairman John Fickling acquired around one million shares each in the AIM-listed company earlier this month. The move was reinforced by investments from fellow directors Mike Dunn, David Maughan and David Stonehouse.

Buying into the company at this stage is designed as a clear statement of intent and confidence that the management team is ready to meet the challenges that inevitably lie ahead.

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