The Ethiopian Shipping and Logistics (ESL), a dominant figure on the inland fleet scene in the region, discloses that it may consider adding more trucks to its fleet owing to the lack of saturation in the market.
During a ceremony held on February 16 at its Mojo facility, 78km east of Addis Ababa, the logistics giant officially disclosed that the new coming 185 trucks are scheduled for operation.
Wondimu Denbu, Deputy CEO for Corporate Service at ESL, told Capital that ESL, which recently rebranded its logo and name, has become a dominant player on the inland transport service since its truck collection expanded in the past few years.
As Wondimu explains, the good number doesn’t mean that the shipping firm may not add more to its fleet.
“Despite our big ownership in the field, the demand is still very high. Annually, we lease a big volume of trucks to transport cargos to the center,” the Deputy CEO explained.
Due to that ESL may consider to buy more trucks in the near future though at the current stage there is no plan on the table.
“The country demand for inland transport is very high. Based on that, we may add more trucks on our ownership fleet,” Wondimu explained.
The 185 new trucks, which set the firm about USD 15 million, now expand the trucks administered by ELS to close to 635. Over the years, ESL has often excluded old trucks from its ownership primarily for cost effective reasons of its handling of long distance operation on the way to Djibouti and other part of the country.
In the past budget year, the government’s logistics arm floated different bids to buy trucks, while some of them failed for different reasons.
For instance, on its failed float, ESL had tried to buy trucks on a differed letter of credit (LC) scheme, while it only managed to attract a Chinese company.
When the logistics firm refloated for the second time in March last year, with a bid opening on April 8, the enterprise invited bidders to submit their offer on both; normal procurement procedure and or deferred LC alternatives and finally concluded the process under direct LC.
“We benefit buying trucks on direct LC since it has a better specification, loading capacity, quality and even price,” Wondimu said.
He explained that on the scheme buying trucks through differed LC the process is undertaken through agents or partners that would have additional charges, “but when you buy the product on direct LC it is held directly with manufacturers due to that different incentives shall be added besides leveraging the negotiation.”
As per the process, the latest supplier is Sinotruck International Co, which is known for its heavy-duty trucks, Sinotrucks, and was coincidentally the company that won a year ago to supply 150 Sinotruck vehicles at the cost of 11 USD million.
The coming of additional 185 units of 6×4 track tractors with 3 axle cargo semi-trailer makes the Chinese prominent brand; Jinan Sinotruck heavy duty trucks a dominant the collection of the ESL inland transport arm.
The total cost of the 185 trucks is about USD 14.56 million, while the procurement of feed kits, recommended spare parts, and diagnostics laptops and software have been concluded at the cost of USD 665,123.
The trucks that are assembled at the arrival point in Djibouti have been engaged on transporting cargos be it containers or bulk.
Currently, ESL has about 373 Sinotrucks, 215 Renault brand of French and 17 units of car carrier trucks that were bought from Renault.