New Deal Secures Specialized Skill and the Most Advanced Propulsion Technology for Russian Market
BERLIN, GERMANY -- (MARKET WIRE) -- May 25, 2007 -- Bombardier Transportation and Transmashholding, Russia's leading rail technology manufacturer, signed an agreement today creating two joint ventures: an engineering joint venture to develop advanced propulsion technology and technical solutions for railway equipment plus a production joint venture to manufacture a family of traction converters based on Bombardier's proven MITRAC(i) propulsion technology.

The agreement was signed in the Russian city of Sochi in the presence of the Russian Railways' President, Vladimir Yakunin.

The engineering centre will be located in Moscow and serve customers from Russia and abroad. The centre is expected to be operational in Autumn 2007. Both companies plan to offer out of this center their capabilities for development of rolling stock and related equipment.

The manufacturing joint venture will produce the first traction converter family at the Transmashholding's plant in the city of Novocherkassk in Russia. In its initial phase, the joint venture will manufacture advanced converters required for a new generation of locomotives with asynchronous propulsion. The propulsion equipment will be used for locomotives of the Russian Railways and for other customers, also outside of Russia. Production of at least 600 converters is targeted by 2012.

For that purpose, Russian workers will be trained by Bombardier in Europe. European experts will also support the production start-up to ensure that the new production site will be designed according to the latest European standards.

Both engineering and production joint ventures will be owned equally by Bombardier Transportation and Transmashholding. The two partners will together invest a total of EUR 12.5 million ($ 16.9 million US) in both joint ventures.

With an unparalleled market demand for up to 7,500 new locomotives in Russia by 2015, these joint ventures ensure that the best technology and engineering skill will be in place to help meet that need for the long term.

During the signing ceremony on May 25, 2007, Bombardier Transportation Chief Operating Officer Wolfgang Tolsner said: "This agreement demonstrates the firm commitment of both parties to develop a long-term industrial partnership that addresses the fast growing Russian market. This industrial base will also be used to jointly enter new markets. We are very proud to take part in the future of Russia's rail industry with Transmashholding and to offer our innovative products and state-of-the-art technology to our partner."

Chairman of Transmashholding Directors' Board Dmitry Komissarov commented: "For the first time in Russian railway manufacturing, a technologically independent engineering centre will be created. Together with our foreign partners, it will develop new advanced products based on mutual experience, knowledge and technologies, not only for the Russian market, but also for other countries."

Photography is available at: http://www.transportation.bombardier.com/photography.jsp