The foundation stone for Karwa Motors project, a strategic partnership project between Oman and Qatar, was laid in Duqm Special Economic Zone on Thursday, under the patronage of HE Yahya bin Saeed Al Jabri, chairman of the Special Economic Zone Authority at Duqm (SEZAD). Also gracing the event with their presence were Khalid Al Hail, chairman of Karwa Motors, Nasser bin Mohammed Al Malki, chairman of Mowasalat Qatar, and Khalid Al Yahmadi, CEO of Oman Investment Fund (OIF) who is also vice chairman of Karwa Motors, along with dignitaries, senior officials from SEZAD and other invited guests.
Karwa Motors is a joint venture partnership between Mowasalat Qatar – the national transport company of Qatar (with a 70 per cent equity stake) and Oman Investment Fund (OIF), a sovereign wealth fund of the Sultanate of Oman (with the remaining 30 per cent stake). Together, the partners will invest around $90mn in the initial phase of the project – a venture with the potential to underpin the growth of a bus hub at Duqm over the long-term.
The stone-laying ceremony marks a key milestone in the development of a landmark initiative to build the nation’s first-ever bus manufacturing and assembly plant based on a strategic investment by the governments of Oman and Qatar.
The plant is initially planned for a production capacity of 1,000 buses a year, which can increase up to 3,000 buses per annum in a phased expansion based on market demand.
The plant is designed to produce Coach buses, City buses and School buses tailored for the local and regional markets. The project is expected to create around 200 jobs in Phase 1, which may double after the expansion with the addition of roles in R&D, design, parts manufacturing and global marketing.
In a statement, Khalid Al Hail, chairman of Karwa Motors, said, “Karwa Motors will leverage Oman’s existing automotive supply chain network to gain a foothold in the Oman and Qatar markets, which is tipped to become the region’s largest by 2022.
“This plant will enable Karwa Motors to sell buses in the largest market of the MENA region while providing greater flexibility for Oman and Qatar. Worldwide demand for buses is growing and this is the first step towards becoming a leading regional bus manufacturer,” he added.
The first stage of the project will be on a 220,000sq meters site located not far from a world-scale multipurpose port currently being developed at Duqm. Al Hail explained, “Proximity and ease of access to the Port of Duqm ensures reduced shipping time and less effort and time on road transportation for raw materials as well as quick dispatch of finished buses to customers. This also assists in speedy release of goods from the port, reducing storage time.”
The state-of-the-art facility will be initially equipped for welding, painting and assembly of buses and coaches. But over time, the project is expected to pull in investments in auto parts, components, engineering services, electronics, workshops and so on, thereby creating an automotive-based manufacturing cluster in Duqm.
Significantly, the leading Chinese bus manufacturer, Higer Co. Ltd., has been named the technology partner and CKD Kit Supplier for the project. Based in Suzhou in Jiangsu Province, Higer is one of the fastest growing bus brands internationally, underpinned by its reputation for innovation, safety and durability.
As with any automotive industry anywhere in the world, Karwa Motors is expected to contribute immensely to knowledge transfer, skills development and socio-economic growth within Duqm and beyond. Besides creating high-value technical and administrative jobs for Omanis, the project has the potential to catalyse the growth of a flourishing automotive components sector, nurture technical talent pools, and also position Oman as a destination for sophisticated industrial manufacturing.
A key spinoff is its potential to support the development of an advanced design, engineering and processing knowledge base in Oman, fuel innovation in processes and product design, and drive the growth of export-led private investments in this industry.