Alstom and Siemens to merge their rail operations

[whole diary]

[stuving]

From the BBC^» (British Broadcasting Corporation - home page):

Alstom and Siemens to create 'European rail champion'

    26 September 2017    From the section Business
Image copyright Getty Images
Image caption Alstom makes TGV^▸ (Train a Grande Vitesse) high-speed trains

France's Alstom and Germany's Siemens are to merge their rail operations.

The tie-up of the two engineering giants will create "a new European champion in the rail industry", Siemens president Joe Kaeser said.

Siemens makes the inter-city ICE trains that run on German long-distance routes, while Alstom makes the French equivalent, the TGV.

The new group, called Siemens Alstom, will be led by Alstom chief executive Henri Poupart-Lafarge.

In a joint statement, the firms said their businesses were "largely complementary" and the merger would enable customers to benefit from a "larger geographic footprint".

The deal is expected to help the firms compete with China's state-backed operator CRRC.

"The global marketplace has changed significantly over the last few years. A dominant player in Asia has changed global market dynamics and digitalisation will impact the future of mobility," Mr Kaeser said.

Alstom currently has a presence in markets in the Middle East and Africa, India, and Middle and South America, while Siemens is in China, United States and Russia.

The group headquarters will be in the Paris area, with half of the shares in the new entity owned by Siemens.

The French government, which owns about 20% of Alstom, will shed its stake as part of the deal.

The firms said the deal had already been approved by both their boards.

This news doesn't obviously belong as "UK^▸ (United Kingdom)" or "abroad", but Alstom themselves claim to have made a third of the trains running here. I think almost all of that's inherited manufacturership, from Metro-Camell, but it's still one less supplier to the market here and across Europe.

[ChrisB]

No mention of EU^» (European Union - about) competition inquiry, which I'd have thought must be necessary?

[stuving]

No mention of EU^» (European Union - about) competition inquiry, which I'd have thought must be necessary?

Presumably - these days "regulatory approval" is a standard step in the process, so referral isn't even seen as an event worth reporting.

For the UK^▸ (United Kingdom) market it's perhaps signalling that's more important than rolling stock. The grouping claims to be world leader in the field, and I suspect that may be true of the UK too.

Apparently the Frankfurter Allgemeine Zeitung is reporting that Bombardier may want to merge its rail business into this grouping too - but that does look like a step too far in.

[SandTEngineer]

Yes. A big looming problem for NR^» (Network Rail - home page).  Only one future signalling systems supplier for them.....

[Rhydgaled]

I wonder what this means in terms of product lines, will the new joint business offer to sell both TGVs^▸ (Train a Grande Vitesse) and Valero (which I think include ICE3) trains, along with Desiros and Cordias? Or will the design teams come together with the aim of producing a new 'best of both worlds' product line, with the old ones discontinued? Or will they simply ditch either the Siemens product or the Alstom one for each market (eg. the TGV for High-Speed and the Desiro for other services) and focus on the remaining one?

For the UK^▸ (United Kingdom) market it's perhaps signalling that's more important than rolling stock.

Unless I missed it, the article doesn't say whether both these areas are included in the merger, or just rolling stock.

[stuving]

I wonder what this means in terms of product lines, will the new joint business offer to sell both TGVs^▸ (Train a Grande Vitesse) and Valero (which I think include ICE3) trains, along with Desiros and Cordias? Or will the design teams come together with the aim of producing a new 'best of both worlds' product line, with the old ones discontinued? Or will they simply ditch either the Siemens product or the Alstom one for each market (eg. the TGV for High-Speed and the Desiro for other services) and focus on the remaining one?

For the UK^▸ (United Kingdom) market it's perhaps signalling that's more important than rolling stock.

Unless I missed it, the article doesn't say whether both these areas are included in the merger, or just rolling stock.

Alstom describe the merger as being "to combine Siemens’ mobility business including its rail traction drives business with Alstom." So that's all of Alstom, bearing in mind that all the non-rail businesses that were part of it have already been sold or merged elsewhere. Whether that includes any contracting businesses (other than manufacturers' support) they may have i don't know. There's a Reuters piece here that explains a bit more of the background , including the merger of Siemens with Bomardier's rail businesses that was abandoned in July.

As to merging the product lines, the obvious answer is that it will happen, but the timescale may be pretty long. I imagine they may even produce new designs that are visibly "TGV" or "ICE" for some time, even if the running gear underneath becomes more common. In any case they will be supporting all designs of trains and signalling in use now, or yet to be sold, for decades to come as well.