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Irizar has the U.S. on its radar

By Doug Jack

It is once again time to bring BUSRide readers up to date on the activities of Irizar, a very interesting and progressive company headquartered in the Basque country of northern Spain in the small town of Ormaiztegui. It is a beautiful region, which prides itself on being the workshop of the country.

Twenty years ago Irizar was one of a number of Spanish companies building inter-urban and touring coach bodywork on all the main makes of European chassis. At that time, it was building around 250 bodies per year, and there were serious concerns about its ability to survive in the industry.

New management came in and quickly decided the key to long-term survival would be as a global player. In Europe that meant entering as many markets as possible, usually in conjunction with Scania, keen on becoming a more widely recognized coach brand without having to design and develop its own complete coach products.

Outside of Europe, the new Irizar team looked at countries with a tradition of people traveling by coach, usually due to usually inadequate rail networks and airfares beyond reach of most passengers.

Since 2008, Irizar has operated in Spain as an independent cooperative, a structure only retained in Spain where the company currently employs 735 people. Another 2,465 work in normal limited companies in China, Morocco, Brazil, Mexico, India and South Africa.

Irizar has four subsidiaries in Spain. Hispacold is a leading manufacturer of air conditioning. Masats makes doors, luggage lockers and other components. Both supply not only Irizar, but also many of the company’s competitors. JEMA is a leading company in the power electronics sector, and INT is its latest acquisition, a company that produces information systems currently in use on trains, but with potential applications for coach drivers and passengers.

I talked to Gotzon Gomez, export sales director, and one of eight Irizar board members in Spain. An industrial engineer by training, he joined Irizar in 1996 and spent his first two years in production. He moved to Brazil in 1998 when Irizar established its subsidiary in that country. His experience as managing director also included the establishment of Irizar South Africa, supplied from the plant in Brazil. Gomez is also responsible for the introduction of the first Irizar. He returned to the headquarters in September 2009 to take up his current position.

Last year, despite difficult conditions in a number of markets, because of the global financial crisis, Irizar still managed to build around 1,400 bodies in Ormaiztegui.

The plant is highly efficient, building four main families of coach bodies on a wide variety of chassis in various lengths and heights.
The range starts with the i4 inter-urban family. The long-running New Century and the new i6 bodies fill the main volume segments in the coach industry. The PB, which stands for New Project in the Basque language, is the top sector coach body.

The assembly floor consists of three parallel lines on one side, a wide avenue through the middle, and two and a half parallel lines on the other side. In a highly organized logistics operation, vehicles delivering components and sub-assemblies on a just-in-time basis to the stations where they are required use the avenue. This saves time requires accurate timing and strong discipline on the part of suppliers.

There are 14 stages on the main lines and they move once every 24 hours. The fourth to sixth stages have paint spray booths, capable of carrying out some very elaborate schemes, including dramatic graduated colors.

The factories in Brazil, China, Mexico, Morocco and South Africa build products that are broadly the same as those in Spain, although not necessarily the full range of the parent factory.

The Moroccan plant also builds the Irea city bus body. Vehicles produced in India and mounted on Ashok Leyland chassis are more heavily adapted for local conditions. Gomez says Irizar has the flexibility to build to maximum widths of 96-inch, 98.5-inch and 102-inch, depending on regulations in its many markets.

Irizar can also adapt to requirements in individual markets. For instance in South America, customers on long distance coaches prefer a much softer seat than in Europe. The factory has even built sleeper models with 16 fully flat beds in a tri-axle 49-foot coach. Almost as comfortable are coaches with two large reclining seats on one side of the gangway and single seats on the other side.

Although Irizar builds city bus bodywork only in Morocco, it is working on a project with JEMA, academic partners, and the bus company in San Sebastian, to produce an all-electric bus, with a target introduction of 2015. Irizar feels that hybrid buses might just be an interim stage. Battery technology is improving all the time, and offers zero emission operation on city streets.

Last year, despite financial problems around the world, Irizar built 4,200 bodies, despite many of their smaller customers finding it practically impossible to obtain finance for fleet renewal. There was a 20-percent improvement in output in the first half of 2011, compared with the previous half year, but Gomez is still cautious with his forecasts. While he thought there would be an overall improvement, there was weak demand in some of the company’s important markets in Southern Europe.

Two years ago Irizar launched integral versions of its i4 interurban coach and the PB and since introduced the new i6. Although the Century coach family continues in production, Irizar’s current practice is to use model numbers rather than names. Gomez says the Irizar brand is all-important.

I asked him why Irizar had taken the decision to develop its own complete integral vehicles. After all, it has a good working relationship with all the main chassis manufacturers, particularly in Spain, where the company regularly enjoys a 40-percent share of the interurban and coach market.

“We are increasingly finding they want to sell their own complete coaches,” says Gomez. “It can be difficult being both partners and competitors. We have customers who are loyal to Irizar, therefore we cannot run the risk of being shut out of any of our markets. We will continue to work with the chassis manufacturers in Spain, but will develop the integral range on a market-by-market basis. We think the integral product is complementary, which will help us increase our overall share in a number of countries.”

For European customers, Irizar is using DAF (Paccar) engines, which have an excellent reputation for durability and economy. ZF supplies the gearboxes and axles. The integral model saves weight compared with a chassis and body combination. This is an important factor, especially on touring coaches with large baggage loads.

I asked Gomez if Irizar had any plans for the United States. A number of years ago the company supplied 80 to 90 bodies on a chassis built in the U.S. but proved less than ideal for the market.

Since then, Irizar has have opened a factory in Mexico to build integral coaches. Paccar will take around 6,000 DAF engines from the Netherlands this year, for Kenworth and Peterbilt trucks. Some of the essential building blocks for a U.S. coach are falling into place.

“The issue is not technical, but strategic,” says Gomez. “We realize that units like ZF axles are not well known in the United States, but there are other potential suppliers who would be more acceptable. DAF engines meet EPA-10 and a service network is in place through Paccar. There are no tariff barriers between Mexico and the States. In the medium term, I am sure that we will go into the U.S., but it must be a step-by-step process.”

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Posted by on Oct 20 2011. Filed under Letter From Europe. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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