In one of its hardest won battles, Bombardier has beat France's mighty Alstom SA for the right to supply €1.5-billion ($2.03-billion) of high-speed trains to Italy.
The contract, to be split between Bombardier and AnsaldoBreda, the rail division of Italian engineering and defence giant Finmeccanica, marks the Canadian company's biggest sale in Italy and one of the biggest in Europe, Bombardier spokesman Luis Ramos said.
It also marks the first sale of Bombardier's Zefiro train in Europe. Previous sales were made in China. "This makes the Zefiro the most successful new high-speed train on the market," Mr. Ramos said.
Trenitalia, the government-owned operator of Italy's train system, said in a statement that the Bombardier-Ansaldo bid was superior to Alstom on both technical merits and price, though the competition was tight.
Alstom, the maker of the famous TGV and Eurostar high-speed trains, fought hard for the Italian contract. At one point in the spring, French President Nicolas Sarkozy sent a letter to Italian Prime Minister Silvio Berlusconi touting the merits of the Alstom bid. Sources said Canadian Prime Minister Stephen Harper did not get involved on Bombardier's behalf.
Bombardier has had a presence in Italy for some 30 years and essentially controls the Italian market for electric locomotives. The new Italian contract puts its at the heart of Italy's effort to modernize its passenger rail system, giving the country trains that are as fast, or even faster, than the high-speed trains in France and Germany. Italy's latest Frecciarossa (Red Arrow) trains, made by a consortium that includes Bombardier, go as fast as 300 kilometres an hour on the main intercity routes.
Bombardier's new Zefiro, known as the V300, will have a "commercial" speed of 360 km/h and is capable of 420 km/h. Bombardier and Ansaldo will supply 50 train sets, each capable of carrying 600 passengers. Each train set is 202 metres long is valued at €30.8-million.
The work will be divided between Bombardier's Italian factory near Genoa, in northern Italian, and Ansaldo's factory near Florence. Bombardier will have roughly 60 per cent of the work and will be responsible for the propulsion and electrical system. Ansaldo will be responsible for the train body and final assembly.
Bombardier has won orders for 160 Zefiro trains to China. It hopes the Italian contract will lead to more European orders.
High-speed and very high-speed rail is one of Europe's biggest growth industries. While France has been the leader, Spain is coming on strong and plans to surpass France's high-speed network by 2020. Belgium, Germany and Italy also have high-speed systems and Portugal, Poland and Russia are developing them. So are Morocco, Saudi Arabia, Argentina, Brazil and several other countries.
China has made high-speed rail an infrastructure priority to fight traffic congestion and slow the rise of carbon dioxide output. It expects to have 50,000 kilometres of high-speed rail by 2020.
Bombardier says the global sector grew by 135 per cent between 2006 and 2009. By 2009, there were more than 10,700 kilometres of railway lines capable of taking trains travelling faster than 250 km/h and another 13,500 km of lines under construction. By 2025, it said, the global high-speed network could reach 70,000 kilometres.
Trenitalia's recommendation that Bombardier be awarded he contract has to be approved by Trenitalia's board of directors, after which the formal contract can be signed. The Bombardier trains will enter service in 2013.