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Perfidious Albion betrays the French again
We live in a global market for engineering products and traction and rolling stock is no exception. While the major suppliers have national factories production is pan-European. All of the big three - Alstom, Bombardier and Siemens – may assemble locally, but they source the components of a new train from their plants across Europe .
For the suppliers the upside of a global market is the ability to supply standard products and source them from wherever capacity is to be found. If a customers wants more trains faster, or local production is falling behind, you simply fire up another assembly line in another country with spare capacity.
But the downside of a global market is that all customers know what goes on everywhere. I had a charming lady reporter from German TV on the phone only the other day asking about all these new British trains sitting around in storage sidings because they didn't work.
So there are no longer purely local problems – as Alstom Transport is finding out. Readers may have noticed that in the UK the company has, to put it tactfully, failed to meet pretty well every delivery promise - of which there have been many.
And some of the on-going failures are spectacular. First Great Western ordered its Class 180 diesel multiple units in May 1998, two months after Virgin ordered its Voyager and Super Voyager diesel electric multiple units.
Service date for the Class 180s was the end of 2000 while the larger Voyager fleet was due to be in service by May 2002. At the time of writing the last Voyager has been delivered while First Great Western are hoping to have two Class 180 diagrams in the June timetable.
Truly grim, and I bet First are beginning to wonder whether they should have cancelled the contract and taken up the option on Voyagers back in September last year.
Of course, anyone can have a rogue contract. Following my rumination on Bombardier's ability to deliver planes and trains, a fellow TAP in the readership pointed me to a report in Flight Magazine on the less than happy debut of the Bombardier Q400 prop liner.
And thanks too to the fellow Pedants who pointed out that it was the eponymous Scaramanga in The man with the golden gun, not James Bond, who remarked on coincidence, happenstance and enemy action. And in the case of Alstom the enemy action in the UK market is causing substantial collateral damage.
When the latest Alstom interim report was published in January, the impact of the UK was much in evidence. For example Transport's operating income amounted to € 88 million in first half of fiscal year 2002, a decrease of 17% on € 106 million in first half of fiscal year 2001. ‘This drop was due to protracted delays in completing deliveries on five Juniper/Coradia contracts for passenger trains in the UK, as a result of initial safety approval delays and subsequent reliability issues', the Report said. And five UK contracts required an increase in working capital of €75million.
So it was understandable that in a review of the business on the internet Alstom Transport President Michel Moreau was quoted as saying, ‘Our biggest disappointment comes from Great Britain . The very poor results from Washwood Heath have not only brought heavy financial losses but have also dragged down our reputation. And this damage to the Alstom name has wide repercussions, not only in the UK but elsewhere as financial backers shy away from taking a “risk” with us. Without the Washwood Heath problems, Transport would have met our financial objectives, but in any case, our current performance is insufficient to meet our objectives for the future'.
From the heart indeed, and with Pendolino already slipping since the ‘handing over' ceremony just before Christmas, there could be more pain ahead for M. Moreau. On top of which the lack of orders in the UK market has knocked 10% points off Europe 's share of Alstom's global business.
As you will have seen from the lead item on the Strategic Plan, no one has any idea who is going to spend SRA Chairman Richard Bowker's £7bn on new trains promised for the next ten years – other than those already on order. And I can tell you that I have long and serious discussions with my chums in the city, the Rolling Stock Companies and the manufacturers about the approaching black hole. So even if Alstom didn't have reputational problems in the UK , it is debatable when the next orders might come
When we all went to Old Dalby last Valentine's day to see Pendolino, the writing was already on the wall for Washwood Heath. To liven things up I offered Mike Lloyd, then Vice President Alstom Transport, a veiled bet. ‘Two years from now Washwood Heath won't be building EMUs and DMUs', I challenged. And when he express surprise, he agreed that £5 would prove me wrong. Since when Mike has left the company.
Were Alstom to close Washwood Heath it would be very bad news for Virgin Trains. It would mean that the factory was running down as the last Pendolinos were built. And, of course, the best staff always go, or are head-hunted, first.
There have been rumours that Siemens might buy the factory for a new UK assembly operation. Well they are probably arrogant enough to think that they could make it work, but a green-field site would surely be the most effective way forward.