Bombardier and Siemens ‘in talks’ about rail merger

Train builders Siemens and Bombardier are reportedly in talks about merging their rolling stock and signalling operations.

The reports first surfaced on Bloomberg on April 11. Neither company would corroborate the reports, but the media giant described the talks as “pretty far advanced”.

Bloomberg claimed that Bombardier and Siemens started talks earlier this year, with Siemens Mobility said to be valued at around 7.2 billion euros (£6.1bn) and Bombardier’s 70% share in Bombardier Transportation worth $5bn (£3.9bn). The merger or joint venture, should it take place, is in response to growing competition in the global marketplace from Chinese companies.

Bombardier has a train building facility in Derby, but Siemens’ rolling stock for the UK is built in Europe. It has signalling operations in the UK. It is unclear whether competition authorities would sanction such a merger, or what the implications would be for possible job cuts.

Bombardier has recently agreed a joint venture project with Hitachi Rail Europe to bid for the Deep Tube Upgrade scheme (formerly New Tube for London).

Both companies already have large orders in place in the UK, with Bombardier building 1,619 vehicles across four orders (66 nine-car Class 345s for Crossrail, 45 four-car Class 387s for Great Western Railway, 45 four-car Class 710s for London Overground and 89 five-car and 22 ten-car Class 720s for Greater Anglia).

Siemens is currently building 1,440 vehicles (60 eight-car and 55 12-car Class 700s for Govia Thameslink Railway, 30 five-car Class 707s for South West Trains and 25 six-car Class 717s for GTR’s Great Northern operations).