(The Montreal Gazette published the following story by Nicolas Van Praet on its website on August 6.)
MONTREAL — Alstom Canada Inc., whose French-based parent has started talks with creditors to fend off a cash crisis, is weighing whether to move its train-building operations from Point St. Charles to a smaller site.
Alstom has been looking at other potential spaces for its train-making operation, Alstom Canada chief executive Pierre Gauthier said in an interview.
Gauthier said about five or six potential sites have been identified in the region of greater Montreal and that the move could occur as soon as this fall.
“We could leave Point St. Charles and set up somewhere else in installations that would be more in line with the capacity of the market,” Gauthier said.
The company rents about 500,000 square feet of space from Canadian National Railway Co., which owns a massive parcel of land in Point St. Charles. It is using barely one-fourth of that space, Gauthier said.
A move could be averted if Alstom strikes a deal with CN to shrink the space it rents. Both companies are in talks about a new arrangement, Gauthier confirmed. A CN official could not say yesterday what the company would do with the surplus land.
Alstom’s move would tear off another strip of Montreal’s former railway glory. Point St. Charles was eastern Canada’s railway focal point as the hub of Grand Trunk Railway in the late 1800s. Trains have been built and repaired there ever since.
Alstom set up shop Point St. Charles in 1996 and initially operated successful production lines that gutted and refitted diesel-train engines and locomotives.
That market has vanished over the past two years, however, and the company is trying to reinvent its Canadian train unit by focusing on passenger rail. It now employs about 150 workers at the Point St. Charles plant. Another 400 or so are on call.
Alstom’s U.S. rail unit, Rolling Stock Americas, is feeding the Montreal yard business as it waits for contracts to call its own.
Gauthier said the train maker has its eyes on several jobs. Alstom is one of four final bidders to provide a rail link between Toronto’s Pearson airport and that city’s downtown. It also plans on bidding on a much-talked-about passenger line in Vancouver, to be built in time for the 2010 Olympic Games.
Alstom SA, the Canadian division’s French-parent, is weathering its own financial storm. Yesterday, the company said its board would meet all day to hammer out a plan for an emergency bailout. Francis Mer, France’s finance minister, reportedly signalled yesterday his government’s intention to partially renationalize Alstom and take a 30-per-cent stake in the company.
Trading in Alstom was suspended for a second day yesterday in New York, Paris and London. The shares have shed 90 per cent of their value over the last two years.