Caterpillar starts the manufacture of locomotives in May

The North-American group Caterpillar intends to start the locomotives plant operations located in Sete Lagoas, central area of Minas Gerais state, in May. The first 21 orders confirmed shall be delivered  in October. The business shall receive investments of US$ 70 million.

The information is given by the Director of Progress Rail Services, controlled by Caterpillar, Carlos Alberto Roso. According to him, the Company received this week the Installation License (LI – licença de instalação), granted by Copam – Conselho Estadual de Política Ambiental (State Council of Environment Policy),linked to the Semad – Secretaria de Estado de Meio Ambiente e Desenvolvimento Sustentável (State Secretariat of Environment and Sustainable Development). The Company is able to start the works with this license, he said.

The plant shall occupy a land owned by Ferrovia Centro-Atlântica (FCA), controlled by Vale S/A. The local government of Sete Lagoas obtained this area by commodatum and shall repass it to Caterpillar.

The Director explained that the engineering project for sheds suitability had already been contracted and it is ready, which will make easy the beginning of the interventions in the area. Besides, Caterpillar already got the equipment to be used in the production line.

In the unit, it will be assembled and manufactured Electro-Motive Diesel (EMD) locomotives, a Progress Rail Services subsidiary, a Company part of Caterpillar’s conglomerate. The plant shall be able to manufacture about 70 4-thousand HP machines a year.

In this first moment, a huge part of the components used for manufacturing is imported. According to the Director, the Company is looking for ways to develop a supply chain to meet the plant’s demand in the Central area of the state.

The enterprise shall  meet the intern increase needs of   locomotives, besides South America’s market. Roso did not discard the idea of future expanding investments, once the plant shall be installed in a 112-thousand square meter land, with 15-thousand square meters of built area.

Caterpillar’s plant located in Sete Lagoas shall occupy a 112-thousand square meter land, with 15-thousand square meters of built area, owned by FCA.

It is estimated that, once the activities start, it shall be created up to 600 job positions. According to the Director, some employees were already hired and they have being trained. The unit will be managed by MGE Equipamentos e Serviços Ferroviários Ltda., also a subsidiary group.

The plant announced last year, was being disputed by other two Brazilian municipalities. Among the crucial factors for the Company’s decision, in the opinion of the municipal administration, were the excellent location of the city, which has a federal highway, and the proximity of a transshipment station for broad gauge.

Besides, the Company is aiming to do business with the biggest companies of the rail industry. The most of them are located in Minas Gerais due to ore, steel and grains transportation, the main products of the State. Negotiations also counted on the State Government’s support through Indi – Instituto de Desenvolvimento Integrado de Minas Gerais (Minas Gerais Institute of Integrated Development), linked to the Sede – Secretaria de Estado de Desenvolvimento Econômico (Economic Development Secretariat).

This will be the second locomotive plant operating in the State. Currently, General Electric Transportation South America (former Gevisa) runs a unit in Contagem (RMBH). In November 2010, the Company announced that is planning to double the machine production by means of a contribution of US$ 35 million in the next three years.