Inside a factory as big as a dozen football fields in this provincial city in the United States, workers are testing new robots that will help weld together 200-ton train locomotives.
“I believe this will be the most efficient locomotive-manufacturing plant in the world,” says William Ainsworth, director of the railway division of Caterpillar Inc.
Ainsworth is under pressure to make that happen as soon as possible. Caterpillar is trying to catch up with General Electric Co. in the locomotive market amid a surge in demand, as rising profits allow railroads to upgrade their fleets.
Making much headway could be a challenge, at least in the short term, because Caterpillar is closing what had been its main locomotive-assembly plant, in Canada, after a wage dispute. The company is relying instead on its new Muncie plant, which opened last year in a former electrical-equipment factory, and on another plant still under construction in Sete Lagoas, state of Minas Gerais. With 12,000 square meters of production area, the new Brazilian plant should be ready at the end of the year and could generate up to 600 jobs by reaching its maximum capacity, according to the Company.
Bombardier Inc. of Canada also assembles locomotives for Caterpillar in Mexican plants.
Despite the disruption, Ainsworth says, customers will not face any delays: We do not anticipate missing a beat.
GE likewise, is gearing up production, adding a new locomotive plant in Texas, while keeping its main factory in Pennsylvania.
For years, GE easily outsold its main locomotive rival, Electro-Motive Diesel, which languished as its owner, General Motors Co., was distracted by its slide toward bankruptcy. Now, EMD is part of Caterpillar, which bought it in 2010, and has the financial muscle to take on GE.
U.S. railroads are expected to step up their buying of locomotives ahead of tougher emissions standards that take effect in 2015. The switch-over to new technology to meet those standards is going to be chaotic, says Brad Wind, executive vice president at Helm Financial Corp., which leases locomotives to the railroad industry.
Higher oil costs have made railroads more competitive with trucks. For long hauls of heavy loads, railroads can be four or five times as fuel efficient as trucks, says Noel Perry, an economist at FTR Associates, a transport consulting firm. That could lead to modest growth in their market share, Perry says, though railroads frequently can’t match trucks for short hops or deliveries to places lacking good rail links.
Albert Neupaver, chief executive of Wabtec Corp., a supplier of rail equipment, estimates 1,100 locomotives were produced in North America in 2011, about double the depressed year-earlier total. He says this year’s output should be about 10% higher. Typically, about a third of the locomotives produced in the U.S. are exported, Neupaver says.
GE and Caterpillar mainly produce freight locomotives, which sell for US$2 million and up, but they are eager to expand in the passenger market, competing with such suppliers as Germany’s Siemens AG and Bombardier.
Union Pacific Corp. plans record capital spending of US$3.6 billion this year, up from US$3.2 billion in 2010; a chunk of that spending is earmarked for 200 new locomotives, a Company spokesman said. Another railroad operator, CSX Corp., plans to buy 65 locomotives this year, according to a spokeswoman.
Caterpillar’s strategy is to start afresh in a new plant without the inefficiencies of the 62-year-old facility it is closing in Ontario. But that means disruption at a time of growing demand.
GE, by contrast, wants to keep all its production capacity available for the current upswing, and so is hanging on to its plant in Erie, which has an experienced workforce and offers wages that are about twice what Caterpillar pays at its Muncie factory. At the same time, it is also opening a lower-wage plant in Texas.
Rail equipment is just a sideline at both companies. Caterpillar makes most of its profits from construction and mining equipment, while GE is more focused on jet engines and energy equipment. But both companies see locomotives as a global growth opportunity.
GE’s transportation business, mainly locomotives, was its fastest-growing unit last year, with revenue up 45% at US$4.9 billion. “We see a good outlook for the future, driven not just by North America, but the international markets as well, such as Australia, Latin America, and Russia,” says Lorenzo Simonelli, who heads the GE unit.
GE’s share of the North American market for six-axle, high-horsepower freight locomotives, the type of large locomotive commonly used by major railroads, has been around 70% in recent years, according to the consulting firm RailSolutions Inc.
Caterpillar, which accounts for nearly all the remaining North American market, moved into the rail industry in 2006 with its US$800 million acquisition of Progress Rail Services Inc., a maintenance services Company.
Then, in 2010, Caterpillar bought EMD for US$820 million from a private-equity investors who had acquired it from GM in 2005.
EMD, once the world’s biggest producer of diesel locomotives, was eclipsed by GE in the early 1990s. Caterpillar estimates that 33,000 EMD engines remain in operation worldwide.
For GE’s Simonelli, new opportunities abound. There is a real renaissance of the freight railroad, he says.
Seja o primeiro a comentar