Bus maker Alexander Dennis is in the final stages of securing orders for 123 buses as part of a £45 million funding round from the Scottish government.

The company, whose Falkirk plant had been threatened with closure, will build 69 single deckers and 14 double deckers for the consortium bidder Rock Road and, in conjunction with Volvo, 40 double deckers for Lothian.

It’s not known how many buses will be built in Scotland, but the company has never built single deckers in Falkirk.

Funding for all manufacturers through the Scottish Zero Emission Bus Challenge Fund (ScotZEB3) will bring 334 zero emission vehicles into the Scottish fleet.

This is made up of 107 coaches and 227 buses, alongside the installation of charging infrastructure. Chinese manufacturer Yutong has been awarded 166 buses.

The contracts have been awarded subject to due diligence and there being no challenge to the outcome, as was the case in the last round which led to ScotZEB3 being set up.

The number of buses being won by Chinese firms against UK bidders has raised eyebrows in some quarters as China has set up companies based in the UK to secure work that is then transferred to Chinese manufacturers. This has enabled China to increase its share of procurement from 25% in 2024 to 50% last year.

Scottish Labour transport spokesperson Daniel Johnson said: “Any buses built at Alexander Dennis are welcome and reflects the genuine ambition of their skilled workforce – but the big picture of this announcement is a staggering lack of ambition from John Swinney and the SNP.

“This SNP bus scam lays bare a government that is stronger for China than it is for Scottish workers.”

However, it is the bus operators who negotiate with their chosen manufacturer, not the government.

Scotland’s biggest bus company McGill’s is seeking legal advice after its £4.3m bid to expand its electric bus fleet was rejected.

Owners Sandy and James Easdale wanted support to purchase 33 zero-emission vehicles from Alexander Dennis.

Instead, the largest single award – worth just over £13m – was granted to an intercity coach operator to add 100 Chinese coaches to its existing network which would not replace a single diesel vehicle on Scotland’s roads.

Ralph Roberts, chairman of McGill’s, said: “McGill’s Group made a bid which would have been worth £16 million to Alexander Dennis and supported skilled manufacturing jobs here in Scotland. We are disappointed that we were unsuccessful and will be reviewing how the bid was scored with our team.”

Transport Scotland said these awards mark the conclusion of funding from the Scottish Government to support large operators to make the transition to zero emission vehicles.

However, the government is looking at options to further support the phased uptake of zero emission buses on local services. 

Across ScotZEB and the Scottish Ultra Low Emission Bus Scheme (SULEBS), the Scottish Government has supported the introduction of about 800 buses and associated charging infrastructure through £154 million of capital funding.

Transport Secretary Fiona Hyslop said: “This final investment of £45 million from the Scottish Government through ScotZEB3 signals our commitment to a zero emission future for Scotland’s bus sector.

“Since 2020, we have invested over £154 million in zero emission buses and infrastructure. This additional £45 million will support the ambition and leadership of operators that seek to decarbonise their operations as quickly as possible.

“It also helps ensure that the bus sector can access the benefits of Scotland’s investment in secure, renewable sources of electricity.

“With every £1 of public funding leveraging over £2.50 of private investment, ScotZEB3 has demonstrated that government and industry can work together to deliver transformative climate action.

“The programme is not only reducing emissions – it’s supporting jobs and our economy, connecting communities across Scotland and improving the experience for passengers across the country.”

Alexander Dennis declined to comment on today’s announcement. It was not confirmed whether the furlough scheme to protect jobs has been renewed following its expiry on Monday.

Rock Road, launched in 2021, works alongside operators, national government, and institutional funders to deliver innovative finance structures that make net-zero transport more affordable.

In partnership with Aviva and the National Wealth Fund, it is providing a way for local authorities to fund new EV buses while retaining all benefits of public ownership without the high capital cost and long-term ownership risk.