(The following story by Tom Tobin appeared on the Democrat and Chronicle website on July 27, 2010.)
ALBANY, N.Y. — Amtrak’s decision to award a railcar assembly contract to an Elmira company dealt a serious blow to Alstom Transportation Inc., a global firm with a huge manufacturing plant in Hornell, Steuben County, and a smaller signaling facility in Henrietta.
CAF-USA, a Spanish company with a growing U.S. presence, including a large plant in Elmira, won the $298 million contract last week to build 130 cars as part an ongoing project to replace Amtrak’s aging passenger train fleet.
CAF expects to add 575 jobs in Elmira, jobs that might have gone to the 800,000-square-foot Hornell plant had Alstom prevailed.
The number of jobs at the Hornell plant, city mayor Shawn Hogan said Monday, is down to around 200 from a high of 1,100. Alstom spokeswoman Isabelle de Fleurac confirmed that a number of jobs in Hornell has been cut, which she said was consistent with way railcar manufacturing works.
“There’s a cycle,” she said. “We’ve certainly reduced the number of jobs from when we were working on a big job. I can’t give you the number. But we will cycle back when other jobs come through.”
The loss of the Amtrak contract was the second major setback this year. The Washington Metro Area Transit Authority chose Kawasaki Rail Car Inc., with an assembly plant in Yonkers, as the preferred bidder to build more than 700 cars for the Washington, D.C., system.
Alstom had won a previous manufacturing contract from the Washington transit system but its most recent bid fell short.
Alstom’s loss of the Amtrak contract, which de Fleurac called “disappointing,” was more telling given the historical context. In the mid-1990s Alstom built the first generation of Viewliner cars for Amtrak.
De Fleurac said Alstom does not plan any more job reductions at the Hornell plant, as the work force there already has been pared sufficiently. She said staffing at the Henrietta plant likely wouldn’t be affected by the Amtrak decision. Alstom recently won a $43 million contract to do signaling work for the New York City subway system.
“We feel that our bid was appropriate on the Amtrak job. We have standards and we stick to them,” de Fleurac said. “The business is definitely becoming more competitive now. Once, we had to compete against three other companies. Now, it’s eight.”
Hogan, the Hornell mayor, who questioned Alstom’s bidding skills when the Amtrak award was announced, said he received some reassurances Monday from Chuck Woechle, Alstom’s vice president of business development. Reached Monday, Woechle referred all questions to de Fleurac.
“They (Alstom) were stunned,” Hogan said. “They don’t think the CAF can do it for the bid they put in. They low-balled the thing.” Alstom’s bid was $90 million more than CAF’s and $120 million more than Kawasaki’s.
“There’s no doubt this is a tremendous blow for Alstom,” Hogan said. “And for us. This is a big loss of jobs regionally. Their message to me today was to be patient.”
Alstom is competing for contracts to build cars for the Port Authority Transit Corp., the New York City subway system and Bay Area Rapid Transit in San Francisco.
Alstom, which is a world leader in the manufacture of cars and equipment for high-speed rail, also has high hopes for American investment in that form of transportation.
Congress has appropriated $8 billion in the first phase of what the Obama administration says will be a major initiative in high-speed rail.