Electric vehicle maker BYD Co Ltd is planning to start trial runs of its SkyRail monorail mass transit solution in Egypt soon, making it the second overseas destination for the Chinese company after the Philippines.
Demand for mass transit systems has been increasing in both the countries－key markets in China's ambitious Belt and Road Initiative. BYD officials told China Daily that the company was confident of further cooperation with these countries in the future.
The transportation authority of Alexandria, Egypt's second largest city, signed a Memorandum of Understanding with BYD for the project on Oct 21. The MoU envisages a monorail project spanning 128 kilometers and plans to conduct feasibility studies. It also marks the first time that SkyRail is being showcased in the African continent.
Alexandria is a well-known historic and cultural city, but plagued by frequent traffic jams. In 2013, local authorities began exploring options to relieve transportation pressure.
"BYD's SkyRail is a clean, affordable and safe way for people to commute. It also utilizes limited road space in towns and cities while minimizing disruption to local communities," said AD Huang, general manager of BYD Middle East and Africa Auto Sales Division.
Thirteen years ago, the carmaker started manufacture and sales of passenger vehicles in Egypt. Nearly one-thirds of the taxis in Cairo are made by BYD.
Khaled Eleiwa, chairman of the Alexandria Passenger Transportation Authority, said he expects the SkyRail to start operations in the seaport city as soon as possible.
Unlike subways, BYD's Sky-Rail requires only a fifth of the cost and one third of the construction time, according to the company.
One is currently operating in Yinchuan, capital of the Ningxia Hui autonomous region.
Monorail is now among BYD's four key business sectors which also include cars, mobile phone components and batteries. According to Securities Times, BYD has received intent orders from 10 cities so far.
Wang Liusheng, chief analyst for the automobile industry at CSM Securities, said he expects BYD's monorail operations to realize profits and generate income this year.
But he admitted that the profits would be minuscule for now and it would be difficult to gauge whether the same would grow as per market expectations in the future.
BYD's shares declined by 3.69 percent and 2.39 percent in the Hong Kong and Shenzhen stock exchanges on Monday.