Alstom-Siemens Mobility merger won’t leave Bombardier out in the cold

By Keith Barrow, International Railway Journal, September 27, 2017

SEPTEMBER 26 brought a double-dose of bad news for Bombardier, with the US Department of Commerce imposing punitive tariffs of 219% on the import of C Series aircraft and Alstom and Siemens announcing the combination of their mobility businesses in a “merger of equals” which will create the world’s second-largest supplier of rail equipment.

Bombardier Transportation generated revenues of $US 7.6bn in the 2016 financial year with Ebit of $US 396m and an Ebit margin of 5.2%. Order intake was $US 8.5bn in 2016, with a book-to-bill ratio of 1.1, and the order backlog stood at $US 32.7bn on June 30 2017. This compares with combined revenues of around $US 18bn, adjusted Ebit of $US 1.4bn and an order backlog of nearly $US 72bn for Alstom-Siemens Mobility. The new entity is still dwarfed by market leader CRRC which, with annual revenues of around $US 35bn, is larger than Alstom, Bombardier and Siemens Mobility combined.

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