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UKEF provides £26mn guarantee to finance zero-carbon bus exports

UK Export Finance (UKEF) is providing a £26mn guarantee to Wrightbus, a Northern Ireland-based transport manufacturer, to boost exports of the company’s hydrogen-powered, zero-carbon double-decker bus to markets worldwide.

UKEF is extending an 80% guarantee on Wrightbus’ financing from Barclays, which comprises a £18mn green trade loan and a £8mn green bank guarantee.

Wrightbus, based in Ballymena, introduced the world’s first hydrogen-powered double-decker bus in 2020, and also produces electric-powered single and double-decker buses. The manufacturer says it aims to produce 3,000 zero-emission buses by 2024.

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“The production of zero-emission vehicles is a capital-intensive process and Wrightbus needed to bridge the gap from the warehouse to road-ready,” UKEF says.

The company has received orders for more than 200 buses, including from Ireland’s National Transport Authority, and has secured contracts for sales to buyers in Australia and Germany, the export credit agency says.

Wrightbus now plans to export to Italy, France, Spain and Southeast Asia, with UKEF’s support enabling it to increase production. The company is also looking to hire 300 staff next year after expanding its headcount by 40% in the last year.

“At Wrightbus, we are entering the next stage of our ambitious growth plan, significantly growing our export volume from our UK base and becoming one of the leading battery electric and hydrogen bus manufacturers in Europe. UKEF’s support will strongly help us on our future global growth path,” says Ben Werth, Wrightbus chief commercial officer.

The company is looking to grow exports to over 40% of turnover in response to increased global demand.

At a GTR roundtable in December 2021, Louis Taylor, former chief executive of UKEF , cited Wrightbus’ expansion as an example of British technology exporters’ role in the transition to net-zero carbon emissions.

“I saw Wrightbus’ hydrogen double decker bus – the first in the world – at Cop26. It’s a great example of the fact that technology is changing enormously, and that this technology is going to have to be rolled out across the globe. There’s no point in the UK hitting net zero in 2050 if nobody else does,” said Taylor.

The export credit agency’s support for Wrightbus forms part of a wider strategy on sustainable trade. UKEF said in July last year it had identified a “huge pipeline” of overseas opportunities for renewable energy projects, and in August 2021 issued its first green transition export development guarantee.

UKEF has historically faced criticism for supporting fossil fuel activity, however. Earlier this year, it was up against a legal challenge for its support of a liquid natural gas project in Mozambique, and an inquiry last year found nearly 90% of the £12.bn UKEF committed in 2020/21 went to just nine companies, including fossil-fuel reliant aviation companies.

The post UKEF provides £26mn guarantee to finance zero-carbon bus exports appeared first on Global Trade Review (GTR).

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Published 23 November 2022