Jorge Navarro
Director of People Transport Solutions
Scania México
/
View from the Top

Scania Prepping to Make Electromobility a Reality in Mexico

By Antonio Gozain | Fri, 05/13/2022 - 16:00

Q: What role does Scania want to play in the transformation of Mexico’s urban mobility landscape?

A: Scania México has been transforming the industry for the past 25 years, importing the latest technology available for driver and passenger safety and energy efficiency to offer a less polluting, more profitable product.

We are working on transitioning from diesel to electric vehicles. The process begins with testing the technology in Mexico, tropicalizing it and finally massifying it. We started with urban gas vehicles and now our focus is on electromobility. Scania México will bring the chassis from Europe and will partner with a national body builder to become more competitive and develop electromobility in the country.

Q: What role does the buses division play within Scania México’s operations?

A: Buses are key to transportation in Mexico. Annually, passengers take 3.2 Million rides by bus, which represents 97 percent of total travel. We have a responsibility to transport people in the most efficient, safe, integral and inclusive way.

Scania arrived in Mexico offering both buses and trucks. In 2007, we paused the manufacturing of trucks and buses became our main business unit. Five years ago, we returned to the trucks market. The bus division remains a key business for Scania México, with over 8,000 vehicles circulating in the country. Mexican clients prefer technology from the EU for the coach segment, due to its safety, efficiency and our integral presence.

Q: What strategies has Scania México implemented to maintain its position as a market leader in the coach sector?

A: We are well-known for our aftersales services. Ten years ago, we implemented a new customer service strategy: building service agencies in our clients’ facilities, which is essential for companies because they no longer need to take their vehicles to an off-site mechanic. We offer corrective, preventive and predictive maintenance, charging a standard fee per kilometer. For example, when the pandemic hit and most buses stopped, we did not charge our clients for service.

Scania México reached a milestone with its aftersales integral service, guarantees, technology, telematics and technical customer service.

Q: How does the Scania Connect service help companies with their fleet management?

A: We can analyze vehicles remotely. For example, if a bus is stranded, our technical staff does not need to visit the site to examine the unit, then return to our facilities for the necessary tools and drive back to the bus to fix it. Instead, we only do one trip because we already know what is wrong with the bus thanks to the remote diagnosis, saving a lot of time.

In addition, technology allows us to plan maintenance and help clients to better manage their fleet. Also, telematics allows us to analyze driver habits to boost energy efficiency and safety. The chassis itself has 14 computers gathering valuable data, which Scania México uses to boost our clients’ operations.

Q: Recently, Scania México announced the Scania Volt with E-Urviabus body. What are the bus’s main features and how will it disrupt mobility in Mexico’s main cities?

A: The Scania Volt is a fully-electric, 19-ton, 11-meter chassis vehicle with a low floor designed for main cities. It can carry 90 to 110 passengers. It is pluggable and has 10 batteries that charge 330kW per hour and an autonomy between 250-300km.

We decided to develop this bus in Mexico. Chassis made in the EU are not always adaptable to the needs of the Mexican urban market. Therefore, we decided to build the body locally with Beccar, a body builder with which Scania México has had partnerships before and which is also betting on electromobility. 

Q: How is Scania México preparing to launch its first e-bus in Mexico?

A: We will have a demo vehicle circulating in Mexico City for several months. Then, we will test it in Monterrey, Guadalajara, Aguascalientes and Merida, which are cities interested in renewing their fleet and reorganizing public transportation routes. This technology is new and we are still developing it and learning its implications. While we already dominate aftersales in diesel and gas, Scania México is still learning and perfecting EV aftersales.

Finance plays a key role. Electric buses are three times more expensive than diesel. New engineering training, specific tools and battery management are also important. The goal is to begin production of the Scania Volt with E-Urviabus body in January 2023, starting with 20 units.

Q: What are the main challenges to boost electromobility in Mexico?

A: The transportation industry is a virtuous triangle: the bus manufacturers, carriers (our clients) and the public sector. The first challenge is the vehicle. Bringing an EU chassis to Latin American markets does not always work. Needs and demands are different, which is why we take the time to test the technology and tropicalize it. Governments usually demand the cleaner, most beautiful vehicles but in that case payment becomes a problem. Buses are not subject to credit and tariffs are politically standardized. For instance, in certain cities, rates should be around MX$15, but due to social implications, they remain at MX$10, generating a 30 percent income deficit.

Q: What challenges do carriers face and how can other actors contribute to solving them?

A: New trends and mobility concepts demand long-term business plans. Owner-operators must become companies to have access to credit and be able to invest. Scania México brings international finance and insurance companies to the country but operators have to become established companies.

Once owner-operators become companies, the next step is the public sector. Governments must give carriers guarantees and incentives to invest in a 15-year loan. For example, Santiago de Chile and Bogota already have over 1,000 e-buses rolling. Those cities’ governments created incentives and owner-operators became bankable. In Mexico, the ROI depends entirely on the people transport business, making it more challenging for carriers.

Q: What were Scania México’s accomplishments in 2021 and what are the company’s priorities for 2022?

A: 2021 was not a year for sales. Scania México sold 172 buses, compared to the 800 to 900 units we previously sold annually. Our main accomplishments amid the historic crisis that the industry is facing were to retain our human capital and remain close to our clients.

When the pandemic began, tourism was paralyzed and 90 percent of fleets stopped. Our goal was to be close to our clients by offering them the quality service that distinguishes us. Although sales figures were far from ideal, we focused on investing in the country. Scania México has a new logistics center and tripled the size of its central warehouse. We are starting to serve the mining industry and we need space. We also created a financial arm, Scania Finance, which is a Mexican company.

Throughout 2022, we will continue working and preparing for the industry’s recovery, which we expect to happen by 4Q23. Our focus will be to continue investing in the country, developing electromobility solutions and bringing the latest technology for our coach, interurban and urban segments, while innovating through our maintenance policies and integral services.

 

Scania is a Swedish company that manufactures heavy trucks and buses. It also builds diesel motors for industrial and marine applications. The company is active in more than 100 countries with a global workforce of 52,000 employees.

Antonio Gozain Antonio Gozain Journalist and Industry Analyst