Note that the significant expansion of Hig Speed Trains expansion is
described in the timeframe of "by 2010." This is only 1 1/2 years
from now. The figures given below are huge. It remains to be seen if
such a development expansion is possible in the time described. But I
have a feeling the ambitions will be even more astoni****ng, something
like five years to build and bring the projects to operation.
Chinese train deal worth US$569M
Scott Deveau, Financial Post Published: Sunday, November 04, 2007
http://www.financialpost.com/Story.html?id=69297
Mychele Daniau Canadian trainmaker Bombardier trains will provide
high-speed trans****t in Asia.
Bombardier Inc.'s trans****tation division yesterday announced a
US$1.5-billion joint-venture deal to build 40 high-speed trains for
the lucrative Asian rail market.
It is the largest single passenger-train deal in Chinese history.
The Montreal-based plane and train maker said it will receive
US$569-million for its part of the contract, which was awarded to
Bombardier Sifang Power Trans****tation Ltd. (BSP), its Chinese joint
venture that includes Power Corp. of Canada and China South Locomotive
and Rolling Stock Industry Corp.
Though significant, the contract is small given the op****tunity China
represents for Bombardier and its competitors in coming years. It is
estimated China will invest nearly $160-billion upgrading its rail
infrastructure by 2010.
Bombardier, the world's largest train maker, trails France's Alstom,
Germany's Siemens AG and Japan's Kawasaki Heavy Industries Ltd. in the
Chinese market, according to Jacques Kavafian, a Research Capital
Corp. analyst.
He said Bombardier struggles in part because the Canadian government
has done little to help lay the groundwork in a country where business
contracts often find their roots in diplomacy.
"In China, you've got the governments of Germany and France heavily
lobbying Chinese officials, whereas our government doesn't lift a
finger," Mr. Kavafian said.
But even a fourth-place finish leaves Bombardier's trans****tation
division in a lucrative position.
"They may still be the smallest five years from now, but they will
still keep getting billions of dollars worth of orders," Mr. Kavafian
said.
Increased air pollution and traffic congestion triggered by a massive
influx of people into China's cities are driving passenger demand,
while its soaring economy is driving freight volumes.
Accordng to Bombardier, China has 43 cities with a population of more
than one million. Only 10 of them operate a subway system; another 33
have plans to develop their own.
Likewise, the population density of cities along China's East Coast
provides a sound financial case for an inter-city high-speed train
network.
By 2010, Bombardier estimates passenger traffic will grow 119% over
2006 levels to 1.5 billion people.
Bombardier has forged three joint ventures in the country to compete
in the rail sector: one for building subways, another for propulsions
and BSP, which is focused on inter-city commuter trains.
Yesterday's deal aims to deliver 640 cars for the 40 highspeed trains
to the Chinese Ministry of Railways beginning in February, 2009, and
August, 2010.
The trains will be capable of speeds up to 250 km/h, although no
locations have been named for their use.
The deal will add to Bombardier's rail presence in China, which
includes more than 1,000 subway cars, highspeed trains (total orders
for 80), automated transit systems, locomotives and signalling
products.
Since the start of the year, Bombardier's partner****ps have won five
contracts in China, of which the Montreal company's share is nearly
US$1.3-billion.
"The interesting part of it is, it's not just for one product," said
David Slack, a Bombardier spokesman. "The broader your product
****tfolio, the broader your product base, the more of an impact you
have."
scdeveau@[EMAIL PROTECTED]
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