Addis Fortune (Addis Ababa)
Issayas Mekuria
21 January 2008
Addis Ababa — One of the 90 (at the time Fortune went to press on Friday) mid-sized buses that entered the country after arriving at the Djibouti Port from China encountered trouble on the Ring Road near Saris. Part of the Anbessa City Buses Enterprise's efforts to alleviate transport shortages in the city, the bus arrived to its compound damaged,. Another bus did not even make it that far. It rolled over near Mile in the Afar Regional State.
The state-owned Walia Intercity Bus Service Enterprise has been selected to carry out after sales maintenance of the 500 mid-sized buses procured from China. The government, through Anbessa City Buses Enterprise, has procured the 25-seat capacity buses at a cost of 13.2 million dollars from HIGER Bus Company Ltd.
"We have been selected satisfying representatives of the supplier with our number of staffs and maintenance facility," Sisay Yimer, general manager of Walia Bus, told Fortune. "It is also an opportunity for us to grow."
The government decided to import 2,000 medium sized buses on credit in 2006 in a bid to alleviate the shortages of public transport in the city. The responsibility was subsequently given to the Ministry of Transport and Communications (MoTC), which instructed the Federal Transport Authority (FTA) to a find credit supplier.
Accordingly, Anbessa Buses signed an agreement with the HIGER in June 2006 on behalf of the Authority for the procurement of the 500 buses. Only 90 of the buses have arrived in Ethiopia thus far, but two are already damaged.
The agreement also obliges the company to provide maintenance services.
Anbessa Buses decided to sub-contract it to a local company instead of setting up a new maintenance facility from scratch.
According to the accord, HIGER is also required to supply eight million dollars worth of spare part with the buses.
"As we currently do not want them to dump all the spare parts in our warehouses, we have opened a letter of credit (LC) with 106,000 dollars to bring the spare parts at our convenience," Sisay told Fortune.
Walia Bus opened the LC at the Commercial Bank of Ethiopia (CBE) three weeks ago.
There are however concerns among the participants of the procurement.
"I do not believe it is right to bring in the spare parts in an extended time as the agreement is to them all at once," an official who participated in the procurement told Fortune. "This procedure is prone to corruption."
Walia Bus will also offer the spare parts for sale in addition to rendering maintenance services in its workshop off Smuts Street.
Walia Bus was born in 1995 detaching itself from Anbessa Buses established during the Derg Regime. Going operational with a capital of 16.9 million Br, Walia has a five per cent market share with its 31 buses.
However, the company is operating at a loss. Though PPESA repeatedly put the company on the auction block, no buyer was interested to acquire it. Thus, of its 900 staffs, the government has recently laid off 500.
But Sisay has hopes that some of the laid off mechanics would get re-employed when Walia launches maintenance services.
"We need 43 mechanics," disclosed Sisay. "Former employees will be given priority as they have experience."
The company's workshop repairs only Mercedes vehicles. For the maintenance of the new buses, HIGER will also send six mechanics from China.
"Only three mechanics were supposed to come for the agreement," said Sisay. "HIGER doubled the mechanics considering the potential market that exists in Ethiopia."
If the remaining 1,500 buses are procured by the government, Walia has planned to open spare part outlets in every district, according to the general manager.
Be the first to Write a Comment!
Copyright © 2008 Addis Fortune. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.
AllAfrica aggregates and indexes content from over 125 African news organizations, plus more than 200 other sources, who are responsible for their own reporting and views. Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica.
