Truck maker Scania invests in Dubai to tap Gulf growth

Swedish truck maker Scania said on Thursday it would build a factory in Dubai to strengthen its presence in the high-growth Gulf region.

“There is very high demand for heavy trucks and buses in the region due to large investments in infrastructure and new construction — not only in the United Arab Emirates but also in the other Gulf states,” the company said in a statement

“The market for heavy trucks is beginning to approach 20,000 per year. Demand for tourist coaches and public transport buses is also increasing.”

The factory, to be located in an industrial site in the port area of Jebel Ali, is to be used for building the body of trucks and customizing completed vehicles.

The facility will have the capacity for customization of about 1,400 vehicles per year and operations will begin in late 2008, the company said.

German car group Volkswagen seized control of Scania in early March and now owns 68.60 percent of the voting rights in the group.


Volkswagen gets shares to take over Scania

Volkswagen, Europe's biggest carmaker, was set to take full control of Swedish truck manufacturer Scania on Tuesday after a small but crucial shareholder agreed to sell its shares.

Volkswagen gets shares to take over Scania
Swedish pension fund Alecta previously held out for a higher share price but agreed to sell its 2.04-percent stake in Scania, paving the way for Volkswagen to acquire full control the company.
On April 30, the German car giant said it lacked less than two percent more shares to reach its 90 percent goal, and thereby force the sale of the remaining shares.
"After new discussions with Volkswagen we have concluded that there will be no increase in their offer," Alecta said in a statement, referring to Volkswagen's refusal to pay more than 200 kronor ($30.5) per share.
In February, Volkswagen offered €6.7 billion ($9.3 billion) to acquire the nearly 40 percent of Scania it did not already own and to strengthen its position against its German competitors Daimler and the Swedish truck maker Volvo.
Scania's board of directors recommended shareholders not to part with shares at the price offered.
The offer expired on April 25th. However, confident that shareholders could be won over, Volkswagen extended its offer to May 16.
The German auto giant already owns truck and bus-maker MAN and bought into Scania in 2000.
It had previously said that it could make annual savings of €650 million through economies of scale by taking full control of the Swedish company.
The takeover is just the latest to hit Sweden's beleaguered vehicle manufacturing sector which has seen Chinese takeovers of the once iconic car brands Saab and Volvo.
Volvo Trucks announced more than 4,000 job cuts over the last six months and a voluntary redundancy scheme aimed to cut costs and increase profitability.