Alstom, rolling stock manufacturer (France), has stated that it is willing to gradually localize up to 35% of locomotive production and maintenance in Ukraine and that it plans to move production operations to Ukraine, starting with the 11th electric locomotive produced for the Ukrainian Railways joint-stock company (Ukrzaliznytsia).
The CFTS portal reported this, citing the Interfax Ukraine news agency.
“To take advantage of a French Treasury loan, the French government requires that at least 50% of the products covered by the loan be produced in France. This is why Alstom's localization volume will be increased gradually: the first 10 electric locomotives will be manufactured in France in order to meet this 50% requirement; starting with the 11th electric locomotive, production operations, namely the production of locomotive bogies, including bogie frames, locomotive roofs, equipment for locomotives, as well as testing and certification, will be moved to Ukraine," the company said.
That notwithstanding, according to Alstom, sourcing from Ukrainian suppliers will begin with the first electric locomotive despite this commitment.
From the very first day of the project, Alstom will be able to purchase such equipment as automatic couplers, alarm systems, fire protection systems, etc. in Ukraine.
“The purchase of electric locomotives is linked to operations involving their maintenance over 40-year service life. The level of localization can reach 35% because of this,” Alstom said.
According to its representatives, the company has already begun searching for suppliers and partners not only to work on the electric locomotive market, but also to take advantage of a number of opportunities in European markets.
“We have already signed over 50 non-disclosure agreements with Ukrainian companies, paving the way for what we hope will become the foundation for a lasting and fruitful partnership,” the company said.
Asked where the company plans to start the project in Ukraine, Alstom said that its representatives have visited a number of production sites, both public and private, in Ukraine in recent years. “We will possibly select various enterprises for production of rolling stock and provision of technical services,” the company said.
As the CFTS portal reported earlier, the Ukrainian Parliamentary Committee on Economic Development’s deputy head Dmytro Kisylevskyi has described the French company’s decision to increase the level of localization of production of electric locomotives for Ukrzaliznytsia from the planned 15% to 35% as the right and reasonable decision.
"France’s Minister of Economy, Finance, and Reconstruction Bruno Le Maire stated that Ukraine’s demand for localization of production was legal. He confirmed his words by signing in Kyiv an intergovernmental agreement on purchase of locomotives worth EUR 900 million by Ukraine with a 35% production localization level (instead of the 15% originally proposed). We saw the minister of one of the key EU countries directly saying that our conditions that production localization during procurements by state-owned companies are reasonable and justified," he said.