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Thu 26 Jun 2008 12:05 PM

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Fuel costs force Aramex to convert fleet

EXCLUSIVE: Middle East's biggest courier company converts vehicles over fuel.

Aramex will convert its Middle East fleet to hybrid vehicles because of soaring fuel costs, its CEO has revealed.In an exclusive interview with CEO Middle East magazine, Fadi Ghandour said Aramex, the Middle East’s biggest courier company, had been hit hard by rising fuel prices but hybrid vehicles would be 50% cheaper to run than their petrol counterparts.

He said Aramex had already converted its fleets to hybrid in Jordan and to run on natural gas in Egypt and once tests had been completed on the vehicles in the GCC, it hoped to become the first company in the region to run an entirely carbon neutral ground transportation fleet.

“This is a big challenge for the whole transportation industry. We’re doing relatively okay but it is definitely affecting our costs. So we are trying to be innovative and flexible in finding alternatives.

“The hybrid vehicles do two things for us. From a cost perspective it is important. And much more important than the cost is our carbon emissions and reducing them, trying to become a carbon neutral company.

“In other markets such as Jordan we’ve already started. In Egypt we’ve transformed our usage of gasoline to natural gas cars so it’s more environmentally friendly and it’s less costly.

Ghandour revealed that the company, which has 307 offices worldwide, had spent two years trying to convert its GCC fleet to hybrid vehicles and he planned to introduce them immediately after testing on them has been completed.

“We’re the first company today in our business to introduce hybrid vehicles. These have not been introduced in the GCC because they are still testing them vis a vis how they respond to heat.

"But we’ve been for the past two years trying to get these vehicles. We will be immediately taking advantage of them.”

Ghandour described how as a result of soaring fuel prices, Aramex was increasingly reliant on transporting goods by ground instead of air in order to cut costs, describing how this makes hybrid cars all the more cost effective a solution.

“The best ways that we are trying to go about (finding solutions to high oil prices) is funding alternative modes of transportation and offering new products. For instance across the GCC we have a massive ground transportation network. We are one of the biggest express trucking operators across the Gulf.

“The client has the option to ship on ground rather than by air and by shipping on ground you are paying a lot less than when you ship by air.”

He admitted that as well as absorbing some of the rising fuel costs itself, Aramex was passing on these increases to its customers.

“The airline passes onto to us the cost increases and we also have a system of passing on a good chunk of that cost to the client. There is that understanding in the marketplace that we can’t absorb all these costs.”

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