NEW York Stock Exchange-listed General Electric (GE) and SA’s Transnet Rail Engineering (TRE) said yesterday their joint venture to manufacture locomotives in SA was ahead of schedule.
The joint venture would see the two companies making a locomotive on South African soil for the first time. GE first delivered a locomotive made in the US to SA soon after opening an African office in 1898.
GE won a tender to supply 100 heavy-haul diesel locomotives to TRE. Earlier this year, the contract was extended for a further 43 locomotives, as Transnet expanded its rail capabilities. This followed years of criticism from the mining industry, frustrated by the low levels of capacity on coal and iron-ore export lines at a time when commodity prices were soaring.
As part of the tender, GE volunteered to include a local content programme, similar to those it had used in other countries, and set a self-imposed target of about 30% for local content, the company said.
The Mineworkers Investment Company was GE’s empowerment partner for the venture.
Transnet was expected to issue a tender for 1300 additional locomotives, 700 of which would be diesel. GE was interested in this potential tender. French company Alstom had also expressed an interest.
In terms of the deal, 133 locomotives were intended to be built locally and only 10 in Erie and Grove City, Pennsylvania. The latter 10 have been built.
So far 54 locomotives have been delivered. They were built by South Africans working for Transnet who were trained by GE staff, TRE’s CE, Richard Vallihu, said. "The key point is that it is difficult to build and manage trains on SA’s uneven terrain. As such, we have trained our staff with the help of the world’s best engineers. Still, this project is a local project which will benefit SA," he said.
The GE Model C30ACi locomotives were the first South African locomotives to meet UIC2 emissions standards.
They would be used to haul freight and coal.
Their advanced technology decreases life-cycle costs, improves fuel efficiency and reduces emissions. The global president and CEO of GE Transportation, Lorenzo Simonelli said the company was committed to building freight trains to service Africa but would have to involve a relatively large portion of local content.
GE said it had surpassed its self-imposed target of 30% local content as the locomotives assembled in SA had 37% local content.
"We are in this for the long haul. We have to be local if we want to do business in SA for years and beyond," Mr Simonelli said.
GE said the 42nd locomotive was a milestone of the order.
"The delivery of this locomotive is a big milestone for GE and the Mineworkers Investment Company as we are celebrating the first South African product delivered by our joint venture company GE South Africa Technologies.
"These locomotives represent great opportunities for Transnet and SA as well as GE.
"Transnet will be able to significantly improve hauling capability while reducing fuel consumption and greenhouse gas emissions," Mr Simonelli said.
Two GE locomotives would do the work of three older locomotives and save 600000l of fuel a year.
They would also reduce emissions by 1500 tons of carbon dioxide per year, equivalent to eliminating the emissions from 310 cars on SA’s roads.
I think it's crucial that as African countries we start putting conditionalities (reasonable of course) that would force multinationals that do infrastructure work on the continent to progressively do skills and tech transfer, with the long term goal of being self suffienct in strategic industries such as railroads, power generation. Africa has a dearth of infrastructure and the level of spending that is going to take place over the next 2 decades is going to stupendous, it will be a pity if we let Chinese, US, EU dominate these sectors. We definitely need them for the tech but they also need us for the growth so lets make sweeten their deals....
Here are the trains by the end of this decade I'm sure SA will be an OEM in the train and locomotive sectors....