8608FW: [Tr2000] Bombardier puts the brakes on N.A. high-speed train plans
- Jun 3, 2005The HSR situation here in North America. Till later, Andrew Dawson
>Bombardier puts the brakes on N.A. high-speed train plans
>Unit's president sees little appetite for it here; no projects are
>By BERTRAND MAROTTE
>Globe and Mail
>Friday, June 3, 2005 Page B1
>MONTREAL -- Bombardier Inc. has put on ice its once-ambitious
>plans for high-speed train travel in North America.
>Andr� Navarri, president of Bombardier Transportation, said in
>an interview yesterday that there is little appetite for high-speed
>rail in North America, unlike in Europe and parts of Asia.
>"For the time being, there is no project which is close to being
>promoted," he said. Asked about the potential for its once highly
>touted JetTrain technology in North America, he replied: "As there
>is no high-speed corridor for the time being, there is no
>Bombardier Transportation spokeswoman H�l�ne Gagnon said
>later that Bombardier is no longer in discussions with any
>government bodies anywhere in North America regarding the
>funding of high-speed train travel.
>"There is no project of any kind in Canada or the United States
>that is the subject of discussions," she said.
>Bombardier Transportation is the rail unit of the global plane and
>Montreal-based Bombardier had for the past several years been
>running a major campaign to spark interest in its high-speed
>train technology in the United States and Canada.
>A high-profile attempt to win approval in Florida for its
>240-kilometre-an-hour JetTrain failed last November after
>taxpayers voted it down.
>And Bombardier, along with French partner Alstom SA, has been
>plagued by technical and other problems with their Acela
>Express train operated by Amtrak in the Washington-New
>York-Boston corridor, the only existing high-speed train in North
>"Is there a market in North America for a very high-speed train?
>It's a difficult issue," Mr. Navarri said at corporate head office.
>While high-speed trains have staked out a place in the popular,
>well-established rail system of Europe, "it's a little more difficult
>to find the right [rail] corridors in North America," he said.
>"We are still prepared to discuss the [high-speed] potential in
>North America, but in North America we will mainly focus on the
>mass transit market," said Mr. Navarri, a former senior executive
>at Alstom who was hired last year by Bombardier to lead a
>sweeping restructuring at Bombardier Transportation.
>It is difficult to get all the players -- especially governments -- to
>agree on how best to develop high-speed train travel in North
>America, he added.
>"Up to now, it has not been possible to find this agreement, with
>the exception of Acela."
>In Canada, Bombardier had high hopes for its JetTrain,
>particularly in the Quebec City-Windsor, Ont., corridor, and had
>been lobbying the federal government for financial assistance to
>upgrade the corridor at a cost of up to $3-billion.
>"Quebec City-Windsor for the time being is on ice, for financial
>reasons," Ms. Gagnon said.
>Other city-to-city links that Bombardier had identified included
>Calgary-Edmonton, Chicago-St. Louis, Los Angeles-San
>Francisco and Orlando-Miami.
>Mr. Navarri said he is not disheartened by an embarrassing
>series of technical glitches, delivery delays and contractual
>disputes related to the Acela Express.
>He said he is confident that the latest snafu -- the Acela was
>yanked out of service in April after cracks on brake components
>were discovered -- will be amicably settled and won't degenerate
>into a legal brawl, as happened four years ago over costly
>Meanwhile, Mr. Navarri said he expects strong growth from
>Eastern European countries as they join the European Union
>and become eligible for funding to upgrade their aging rail
>Bombardier Transportation -- the world's largest manufacturer of
>rail transportation equipment -- also sees growth from the
>planned standardization of Europe's patchwork rail signalling
>system, as well as from the boosting of its services unit to about
>30 per cent of revenue from 17 per cent today, he said.
>Outside Europe, China represents a huge potential market for
>Bombardier, Mr. Navarri said.
>He also said Bombardier Transportation's restructuring plan --
>announced last year -- is on track and even ahead of schedule,
>with a work force reduction of about 15 per cent, to about 30,000
>from more than 35,000 and the closing of seven facilities in
>Europe by the end of this year.
>"All these plans are starting to show good results, especially in
>terms of profitability," and the rail unit should reach its target of
>6-per-cent profit margins in the medium term as expected.
>Six per cent is not the ultimate goal, he added.
>"After that, we want to go even further."
- Next post in topic >>