Daewoo Express plans to introduce 200 inter-city electric buses in Pakistan

Daewoo Express, one of Pakistan’s leading inter-city transport service providers, is planning to introduce 200 Electric Vehicle (EV) buses gradually in the next two years along with 1000 EV rickshaws for Karachi and Lahore in collaboration with Sazgar Engineering, Business Recorder has learnt.

If it goes as planned, it will be the first EV-based inter-city bus service in Pakistan.

Sheriar Hassan, General Manager at Daewoo Express, says the company has taken the initiative to introduce cutting edge transport technology in the country as well as protect the environment, while helping improve Air Quality Index (AQI) levels through use of green technology.

Daewoo Express is hopeful that multi-million dollar financing for these two projects will be finalised by January-February 2024 with an Asia-based development funding agency.

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“There are two main reasons for this plan to introduce these EV buses for inter-city transport. As market leaders, we feel it is our responsibility to lead the transition from fossil fuel based transport vehicles to environment-friendly electric vehicles. This transition will help in improving Pakistan’s worsening environment indicators through zero tailpipe emissions and lower noise pollution,” Hassan told Business Recorder.

The company is planning to introduce 200 electric buses for short inter-city routes across Pakistan gradually in the next two years, along with 1,000 electric rickshaws for Karachi and Lahore. Sazgar Engineering will collaborate with Daewoo in assembling the custom-made electric rickshaws.

The electric buses are expected to start operations during summer next year, and all 200 buses will be in operation by mid-2026.

The EV buses will operate on short routes having a maximum distance of 225 kilometres so that they don’t have to stop during journey for charging as it would be inconvenient for passengers.

These 200 electric buses will run on 17 short routes such as Karachi to Hyderabad; Peshawar to Rawalpindi; Lahore to Faisalabad; Lahore to Sialkot etc.

“We will have charging facilities on all of our terminals where these electric buses will operate,” Hassan said.

Hassan said it is difficult to predict how introduction of these electric buses will affect inter-city fares as no one knows what will be the price of diesel and electricity by the time these buses are introduced.

“However, it should be remembered that upfront cost of electric buses is significantly higher than that of diesel buses,” he added.

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The company says it’s working with three to four Chinese bus manufacturers, but yet to finalise the one manufacturer it would eventually be purchasing the buses from.

“If this pilot project of 200 buses is successful, we may consider entering into the electric bus manufacturing business,” Hassan said.

The company already has a manufacturing facility in Sundar near Lahore, which it acquired from Swedish auto manufacturer Volvo in the early 2000s as Volvo in Pakistan switched its business from Completely Knocked Down units to Completely Built units.

So far, it has signed a Memorandum of Understanding (MoU) with Sazgar Engineering for manufacturing of 1,000 EV rickshaws, which Daewoo Express will operate in Karachi and Lahore as a ride-hailing service.

“Introduction of EV rickshaws will also go a long way in improving air quality and reducing noise pollution in the two biggest cities in Pakistan,” Hassan said.

Separately, a source in the government told the scribe that the company is in talks with the Asian Infrastructure Investment Bank (AIIB) for around $24 million for the project.

Another source informed that the AIIB would also engage other financing agencies since the financing amount required for these green projects is higher than $24 million.

However, the company didn’t share or confirm this detail.

What do experts say?

An official of the Ministry of Climate Change (MoCC), on condition of anonymity, said the Ministry of Finance shared details of the project with them for its ministry’s expert opinion.

“We told them that it’s a good project. We also want EVs to make it to Pakistan roads as traffic has a huge contribution to pollution. Look at the smog today. Four districts in Punjab are shut down, there are smart lockdowns because of pollution,” the official said.

However, the official added that MoCC conveyed that the company should use renewable sources of energy to charge its electric buses such as solar energy otherwise using conventional electricity through the grid would not give the desired results to reduce carbon emissions since electricity produced in the country largely comes from fossil fuel.

“It has been agreed that initially the company will use conventional sources and later they will convert electricity sources to renewables to charge their buses.”

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Hassan confirmed this, saying Daewoo Express already has plans to introduce solar farms in Karachi and Lahore as a part of this project.

Dr Aazir Anwar Khan, Founder and Director, Integrated Engineering Centre of Excellence (IeCE), University of Lahore, says bringing 1,000 electric rickshaws would be helpful in reducing carbon emissions.

“It’s a small number as compared to 500,000 rickshaws on roads (and 100,000 being sold every year since 2019) in the country. But it’s a good start,” he said.

Mentioning a study, he shared that on average a petrol CNG/LPG rickshaw emits 8 tons of carbon dioxide, and by introducing 1000 rickshaws, 8000 tons of carbon emissions could be reduced.

“However, there will be a need for swappable battery stations for these rickshaws. Because it will be difficult for these rickshaws to get battery charged from a charger,” he said.

Battery swapping or battery switching is an electric vehicle technology that allows battery electric vehicles to quickly exchange a discharged battery pack for a fully charged one.

“About the plan of Daewoo Express bringing some 200 buses, it’s something one should support as a total of 9600 tons of carbon emissions can be reduced. But the company should also work on transfer of technology. It will not be just that it will keep importing buses or CKD (Completely Knocked Down) kits. The company should gradually localise in the long run, “ Aazir Anwar Khan said.

Yasir Hussain of Climate Action Center – a group that creates awareness for climate change initiatives - termed the initiative “a big and welcome jump” towards achieving green goals of the industry.

“This initiative will not only help in improving air quality but would also prove to be financially viable because of pure scientific reasons,” Hussain said. “From engineering point of view, fossil fuel has higher energy losses as compared to electricity. It means an internal combustion engine (ICE) wastes a lot of energy, but an electric motor doesn’t do the same. ICE is a 100 year old technology.

“Electric vehicles are also easier to maintain because the number of parts are very much lesser than an ICE vehicle,” he added.

An auto sector expert Mashood Khan said electric buses in the country have been imported separately by different provincial governments.

“Sindh, Punjab and KP are all importing buses separately. If there was a joint plan, a plant for making buses could have been established,” he said, adding that there is a huge potential in two-three wheels as well as buses for public transport on the back of a huge gap presently.

“If work is sincerely done, we can see quite progress. But there is a need for sincerity. There should be investment in the industry. There shouldn’t be just trading that you import and not work on manufacturing in Pakistan,” Mashood Khan emphasised.

The article, originally published on November 15, was updated on November 17 since it erroneously mentioned that Volvo had wrapped up its business in Pakistan. The company clarified that it switched its business from Completely Knocked Down units to Completely Built units. The error is regretted, and has been rectified.