Alexander Dennis awaits funding deal on bus orders – Daily Business
2 min read
Alexander Dennis: needs orders (pic: Terry Murden / DB Media Services)
The future of bus maker Alexander Dennis will depend on the outcome of a key funding decision due before the Scottish parliament goes into election purdah later this month.
Bus operators are awaiting the outcome of Transport Scotland’s latest allocation of grants which will then trigger deals with manufacturers.
It is believed that Falkirk-based Alexander Dennis has been negotiating with bus companies which it will confirm if they are successful in the £45 million Scottish Zero Emission Bus Challenge Fund (ScotZEB 3).
This is expected to be announced before parliament dissolves on 26 March, three days after the £4.1 million furlough scheme protecting 400 workers at Alexander Dennis expires. The furlough scheme has yet to be drawn as it is conditional on the company winning orders.
At today’s SNP conference, Deputy First Minister Kate Forbes told Daily Business that she could not comment on the process, but said the government’s commitment to Alexander Dennis had been “resolute”.
She said: “We want to provide support to them and we have negotiated extensively for the last few months.”
Speaking about the furlough scheme, she added: “We made clear at the beginning that that money was contingent on them securing orders.”
On whether it will be extended if there is no announcement on orders, she said: “This has to be resolved before 26 March.”
Ms Forbes said the UK government must deliver on regulatory changes that can achieve longer-term solutions across the UK bus market.
The Falkirk plant was rescued from potential closure last September after its owner announced plans to move production to a factory in Scarborough, North Yorkshire. The furlough scheme was put in place to retain the workforce in Scotland on about 80% of their wages.
ScotZEB 3 complies with the UK Bus Services Act 2025 which prohibits the use of new non-zero emission buses on local bus services. It is focused specifically on operators of registered local bus services.
UK based manufacturers currently face particular challenges from China which has set up UK based companies to secure work that is then transferred to Chinese manufacturers.
This has enabled China to increase its share of procurement from 25% in 2024 to 50% last year.
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