It’s official: the 31st of July 2020 marks the day the European Union approved the takeover of the railway rolling stock manufacturing division of Canadian company Bombardier by the French railway rolling stock manufacturing company Alstom. This approval comes with a few conditions.
When the EU rejected the Alstom/Siemens merger in 2019, the main argument was that it would have created a monopoly in the European railway market, which would’ve been unfair to other companies like Bombardier, Stadler, or CAF. To prevent another refusal, this time Alstom came forward with four engagements to ease the approval. These are:
- the divestment of the 780-employee Alstom production facility of Reichshoffen in Eastern France and the Alstom Coradia Polyvalent regional multiple-unit platform to another company
- the divestment of the Bombardier Talent 3 regional multiple-unit platform and the associated production facilities in Hennigsdorf, Germany, to another company
- the transfer of Bombardier’s contribution in the current and future Bombardier/Hitachi Zefiro very-high-speed multiple-unit platform to Hitachi (V300 Zefiro in Italy and HS2 bid for the UK)
- the grant of access to some of Bombardier’s products and interfaces of Train Control Management Systems and Signalling On-Board Units.
Financially struggling in all of its divisions (rail and air transport) in the recent years, Bombardier needed a solid candidate to buy the company and provide a viable future for its factories and employees around the world. Alstom proved to be this ideal candidate, and this takeover will enable Alstom to grow in size and revenue and become the world’s second-biggest railway rolling stock manufacturer, after China’s CRRC. The creation of this European railway giant will enable the continent’s railway business to confidently face an industry that is at risk of being dominated by Chinese companies, harming fair competition principles in Europe.
The new giant Alstom will, after the 6 billion EUR takeover, have more than 75 000 employees (before the above-mentioned divestments), and a revenue of more than 15 billion EUR.
The work is not over yet. There still needs to be a few more regulatory approvals and conditions. The process is expected to be finalised in the first half of 2021.
About the conditions:
This product platform of EMUs and BMUs will be up for sale. The sale of the French manufacturing plant in Reichshoffen, near the German border, employing around 800 people, will be included in the divestment.
The (third generation of) Talents will also not be a part of Alstom’s new portfolio if the takeover is approved. The Talent platform will be divested too, and so are the corresponding production lines in Hennigsdorf, Germany.
Bombardier’s stake in the Zefiro projects will be ‘transferred’. It concerns the high-speed train platform developed in cooperation of Hitachi in Italy and the joined bid for UK’s High Speed 2 project.
- Deeper access to onboard systems
Along with this, Bombardier will enable access to certain interfaces and products for onboard signaling units and train control management systems.