Bombardier Transportation wins US$91M for rail signal equipment in China

MONTREAL (CP) - In what it calls a groundbreaking deal, Bombardier Transportation (TSX:BBD.B) has won a contract for rail signalling equipment in China worth US$91 million. The new system will manage high-speed trains travelling at speeds up to 300 kilometres an hour along nearly 1,000 kilometres of rail line between the cities of Wuhan and Guangzhou.

The order came from systems integrator China Railway Signalling and Communications Corp. and involves European Rail Traffic Management System Level 2 technology, Montreal-based Bombardier said Friday.

The new system is scheduled to enter commercial operation in January 2010 and the contract involves a 15-year agreement between CRSC and Bombardier.

"This contract reinforces our excellent business relationship in China and further demonstrates the customer's confidence in Bombardier," Andre Navarri, president of Bombardier Transportation, said in a release.

The system will be developed at Bombardier Transportation's rail control solutions sites in Sweden and Thailand, and will include technology transfer so that the final units for the contract can be built in China. Product design will be carried out in Sweden and China.

On the Toronto stock market Friday morning, shares in parent company Bombardier Inc. were down 42 cents, or seven per cent, to $5.32.

© The Canadian Press, 2007