Eastern Petroleum, Russia’s GAZ in deal for bus import

Published in BusinessMirror, September 7, 2017

Written by Lenie Lectura


Eastern Petroleum Corp. and GAZ Group of Russia will work together to bring into the Philippines light commercial vehicles meant to replace dilapidated buses that mostly traverse along Edsa.

The independent oil firm said on Wednesday it signed a cooperation agreement with GAZ Group, one of the leading manufacturers of commercial vehicles in Europe. GAZ, also exporter to more than 40 countries, is part of one of Russia’s leading diversified industrial groups Basic Element.

Based on the signed agreement, Eastern Petroleum was granted the right to distribute and conduct after-sales service of GAZ’s light commercial vehicles in the Philippines, including exclusive rights to sell Gazelle Next 17-seater minibus and Gazelle Next Cityline 20-seater bus.

The companies agreed that the GAZ Group would supply in the Philippines reliable and modern Gazelle Next buses which fully meet the requirements of the Philippine government’s Fleet Modernization Program (FMP). The FMP is a large-scale state program to replace old buses. At the first stage, until 2023, more than 200,000 units – minibuses, medium and large buses – will be replaced by new buses and more than 150 new bus routes will be launched. The key goal of the program is the full transport system modernization that should rely on reliable, safe and comfortable buses meeting the highest environmental standards.

Eastern Petroleum Chairman Fernando Martinez said the partnership with GAZ Group allows his company to aggressively participate in public-transport modernization that “badly needs private and public sector investments.”

“More than 200,000 units of the commonly used mode of transport called jeepney and vans are due for immediate replacements in the next five years,” Martinez said. “The GAZ Group products fully comply with the environmental standards of the Philippines and also meet all requirements for comfort and safety.”

Martinez said 12 sample units will arrive in the country before the end of the year.

“These samples will be used for display and marketing, market studies, among others. Our bus lines will cover 17 to 70 passengers, depending on route,” Martinez said. “With respect to pricing, we are currently finalizing the local price for the units.”

For the modernization program, Eastern Petroleum is looking at selling the units to existing operators or individuals.

“Eastern is now organizing Gazelle Motors, which will handle the importation, distribution. Dealership program will also be established, while existing UV Express owners/operators will be a priority, as well as travel/hotel operators and corporate clients,” Martinez said. Aside from Martinez, the agreement was also signed by Christian Kremer, senior vice president for sales and marketing of GAZ Group, during the International exhibition of commercial vehicles “Comtrans 17,” which takes place in Moscow until September 9.

The Gazelle Next family is a line of light commercial vehicles that combine high functionality and modern technical solutions. The Gazelle Next range includes trucks, utility vehicles, vans and minibuses. Gazelle Next are equipped with diesel, gasoline or gas engines.

“The Philippine commercial vehicle market is growing by 30 percent annually, and the large-scale government’s Fleet Modernization Program begins in 2018,” Kremer said. “We are glad that GAZ Group was able to get such a reliable business partner, as Eastern Petroleum that will help us to develop rapidly in the market, and also become a full participant in the state programs for the public transport renewal. Our reliable, safe and comfortable Gazelle Next will appear on the Philippine roads very soon.”