Siemens-Alstom Merger & Amtrak

Real Talk: CRRC will be a force to be reckoned with in 10 years. Look at Sumitomo/Nippon Sharyo and the Japanese in general. In the 1970's, nobody ever believed the Japanese would make it here, to the point that mainstream American buyers picked up sub-bar rolling stock from SLC and Budd (IE highliners and Metroliners). Then Sumitomo gets a 40-car order from the little interurban in Indiana that refuses to die. Then Kawasaki gets a little streetcar order. Then it keeps happening until Kawasaki and Sumitomo are the tops (until this recent screwup).

Look at China. They're building HST's, they're building diesels (admittedly crummy ones compared to GE and EMD). Argentina is basically sole-sourcing their rolling stock from China when they were once Alco and EMD stalwarts. Then you have CTA and MBTA buying subway cars from CRRC. There is a giant subway car plant going up a few hundred yards from the Hegewisch train station on the South Shore.

Siemens/Alstom is the right move and here's hoping Boeing gets BBD and makes that stronger, too. Perhaps we'll also see a Breda/Talgo/Stadler tie up, or a Hitachi-Nippon Sharyo merger. It's coming.

Far-out prediction: if CAT can't get results from EMD, it goes to the Chinese.

Tadman wrote:Siemens/Alstom is the right move and here's hoping Boeing gets BBD and makes that stronger, too.

Unless Boeing wants to reenter the rail industry? Second time around might be better.

Tadman wrote:Real Talk: CRRC will be a force to be reckoned with in 10 years. Look at Sumitomo/Nippon Sharyo and the Japanese in general. In the 1970's, nobody ever believed the Japanese would make it here, to the point that mainstream American buyers picked up sub-bar rolling stock from SLC and Budd (IE highliners and Metroliners). Then Sumitomo gets a 40-car order from the little interurban in Indiana that refuses to die. Then Kawasaki gets a little streetcar order. Then it keeps happening until Kawasaki and Sumitomo are the tops (until this recent screwup).

Let's see if they can compete on something besides cost, first. The Chinese are notorious for falling way short on quality, so far. About the only place they get it right is nukes. They haven't gone anywhere with airliners yet, despite numerous tries. Their industrial equipment by and large sucks. Buicks are aspirational in China. When your domestic population looks up to GM quality....

they're building diesels (admittedly crummy ones compared to GE and EMD).

With a nuke opening practically every month, it's pretty obvious what China's long term RR plans are (among other things). Why bother developing your own diesels unless you want to assault the US freight industry? Everything's going electric everywhere else.

Then you have CTA and MBTA buying subway cars from CRRC. There is a giant subway car plant going up a few hundred yards from the Hegewisch train station on the South Shore.

I think politics is playing a bigger role, combined with price. Remember part of Rotem in Philly was workfare. Though my rides on the SL V suggest they're not horrid, even if they're a bit below world class. No worse than anything Bombardier's done recently, though.

Siemens/Alstom is the right move and here's hoping Boeing gets BBD and makes that stronger, too. Perhaps we'll also see a Breda/Talgo/Stadler tie up, or a Hitachi-Nippon Sharyo merger. It's coming.

NO!!! Keep Breda away from everyone else! Talgo/Stadler might be fun to watch, though. The JDM market might be big enough to support a few Japanese builders, still.

Far-out prediction: if CAT can't get results from EMD, it goes to the Chinese.

More realistic: EMD just dies. Let's face it, they have no product right now.

Nasadowsk wrote:More realistic: EMD just dies. Let's face it, they have no product right now.

The tier 4 SD-70's aren't selling? Have the Union Pacific units had major problems or something?

Is part of the problem, though, just a general downturn in business and lackluster (at best) interest in tier 4 designs? Not saying you are completely off base or anything, just hadn't heard nearly so gloomy an assessment of EMD.

Phil, I think you are a really sharp guy and I respect your opinions and thoughts, but we kept saying this stuff about a lot of groups that have handed us our a** on a platter. Look at Hyundai cars, they were the butt of jokes for ten years. Now they make luxury cars that are really nice.

USRailFan wrote:...
(Contrary to what the political left wants people to believe these days, it was the USA that once was a colony of a European nation, not vice versa)

Generally we are urged to keep political opinions here to a minimum.

How soon would EU regulators make a decision on an acquisition of this magnitude?

Obviously, BBD is in need of recapitalization. The obvious route is into eventual bankruptcy, with CRRC coming in as a White Knight or buying it from the estate. The Chinese are flush with capital from all the goods we are buying, and they are using that capital to buy up the remaining good companies. BBD is a Canadian corporation, so Trump would have difficulty blocking the sale. CRRC can manufacture components in China, label the vehicles a Bombardier, and assemble them at CRRC factories in the US for Buy America. Public agencies pretty much have to accept the lowest reasonable bid. Owning BBD would allow them to manufacture the vehicle shells in Canada which makes more sense than shipping them from China.

BandA wrote: CRRC owning BBD would allow them to manufacture the vehicle shells in Canada which makes more sense than shipping them from China.

Stainless car shells are now produced in-house at Plattsburgh (since 2009).

ADMIN COMMENT:

A little cleanup here.

BandA wrote:Obviously, BBD is in need of recapitalization. The obvious route is into eventual bankruptcy, with CRRC coming in as a White Knight or buying it from the estate. The Chinese are flush with capital from all the goods we are buying, and they are using that capital to buy up the remaining good companies. BBD is a Canadian corporation, so Trump would have difficulty blocking the sale. CRRC can manufacture components in China, label the vehicles a Bombardier, and assemble them at CRRC factories in the US for Buy America. Public agencies pretty much have to accept the lowest reasonable bid. Owning BBD would allow them to manufacture the vehicle shells in Canada which makes more sense than shipping them from China.

As of this week, BBD just went into partnership with Airbus on the C Series. Taking what this transaction looks like a step further, BBD will probably be out of the commercial aircraft business within a few years should Airbus be able to buy out Quebec's share of the C Series...

If they got enough cash out of the Airbus deal, rail manufacturing may have a stay of execution for the medium term.