Bombardier inks U.K. deal for train cars as rivals set to merge

Bombardier Inc. has signed a US$724-million contract to supply 333 of its electric Aventra vehicles for a United Kingdom rail franchise as the Montreal-based firm’s train division braces for steeper competition due to a massive merger between its European rivals.

Bombardier Transportation announced Tuesday it signed a contract with Corelink Rail Infrastructure and West Midland Trains to supply the new vehicles, as well as maintenance and support services through to April 2026, with an option to extend.

Will Tanner, a spokesperson for Bombardier Transportation (BT) in the U.K., said the division remains strong in the European market, and that the proposed merger between Germany’s Siemens AG and France’s Alstom is not a concern for the company’s most profitable division.

“BT remains the best global customer relationships and product portfolio,” Tanner said in an emailed statement. “While it’s obviously an important development, the proposed transaction between Siemens and Alstom has yet to be notified to the regulatory authorities, and will delay either company’s ability to respond to BT’s transformation program, which we are already halfway through.”

Siemens announced in September it planned on merging rail operations with Alstom in order to compete with Chinese rail giant CRCC Corp., leaving Bombardier out in the cold after months of negotiations.

Tanner called BT’s Aventra platform “a real success story,” pointing to the more than 2,500 vehicles on order in the U.K. for the Elizabeth Line, London Overground, and Southwestern, Greater Anglia and West Midlands franchises. In June, the company landed its largest Aventra deal to date for 750 trains with First Group and MTR in the United Kingdom, a contract worth an estimated US$1.1 billion.

Bombardier will produce the 333 carriages at its U.K. facility in Derby, which is expected to add 300 more staff in 2018 to meet existing demand. The new vehicles are set to be delivered between 2020 and 2022.

Chris Grayling, the U.K. secretary of state of Transport, said in a statement the investment is part of “the biggest rail modernization program for over a century.