Delivery of Units to Begin in 2007
ERIE, Pa. and BEIJING, China (November 1, 2005) -- General Electric today announced that it has signed a contract worth more than $450 million with theChinese Ministry of Railways (MoR). Under the agreement, GE, in an industrial cooperation with Qishuyan Locomotive and Rolling Stock Works (QLW), will supply three hundred 6,000-horsepower locomotives.
"We are excited and pleased to advance our presence in the rail industry in China," said John M. Dineen, President and CEO of GE Infrastructure's Rail business. "This industrial cooperation will open new lines of revenue, give us a larger installed base outside of North America and enable GE to better compete to replace China's current fleet of 6,500 mainline locomotives over the next 15 years."
Design and logistics work is underway, with the first locomotives under this contract to be delivered in 2007. Deliveries will continue through 2009. Last year, China's MoR awarded over $300 million in contracts to GE for rail technology including locomotives, switching machines and advanced train control technology.
In order to address the rapid increase in demand for rail services, the MoR has initiated an extraordinary capital improvement program to upgrade and expand the rail system in China to increase the throughput of the nation's goods and raw materials. GE's locomotives, Incremental Train Control System™, CTS-2™ switch machines and Locotrol™ distributed power will play an important role in helping the MoR realize its goals of increasing velocity, capacity, productivity and reliability throughout China's rail network.
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The signing of this contract represents a significant advancement in the Rail business' globalization strategy," said Luke Clemente, President of GE Infrastructure --Rail, China. "With this contract GE will not only participate in the substantial growth in the North American rail industry but we also are positioned to become a long-term supplier to the MOR in order to participate in the growth of the China market."
In June 2005, GE formed six industry-focused businesses to penetrate fast-growing, global markets. GE Infrastructure is comprised of GE's Rail, Aviation, Energy, Oil & Gas, Water and the financial verticals associated with those industries.
Dineen believes there is tremendous growth potential for Rail's products and services in markets such as China, Russia and the CIS region. "Many of the world's railways are congested and outdated and can benefit from GE technology. More often, our locomotives and signalling technologies are being called upon to help customers around the world to operate more efficiently, reliably and with the environment in mind."
GE is recognized as one of the leading suppliers to the rail industry. Earlier this year,GE began commercial production of its Evolution Series™ locomotives, one of GE'secomaginationSM products, to help North American Class I railroads meet new, stringent EPA Tier II emissions standards and to help improve fuel efficiency for all its customers.
Added Dineen, "The 16-cylinder engine that powers these locomotives is based onthe Evolution engine platform currently in production in the United States. Ecomagination is about helping all of our customers, in North America and around the world, solve their most challenging environmental issues."
About GE Infrastructure - Rail
GE Infrastructure - Rail, a unit of General Electric Company (NYSE: GE), delivers technology solutionsfor the rail, marine, mining and energy industries. Products and services include freight and passenger locomotives, diesel engines for marine and stationary power applications and motorized systems for mining trucks and drills.
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GE Infrastructure - Rail
Chris Banocy