ERIE, Pa. — GE Transportation Systems Inc. booked $1 billion in new orders during the third quarter, a number that bodes well for the company as it heads into 2003, the Erie Times-News reported.
The new orders include about $500 million in deals for new DASH-9 locomotives that would be produced at the company’s Lawrence Park locomotive plant in 2003, the company announced Friday.
Based on an average locomotive price of $2 million to $2.5 million, that equates to 200 to 250 new locomotive orders booked during the third quarter, which ended Sept. 30.
The encouraging numbers, included in General Electric Co.’s third-quarter report, come during what has been a difficult year for GE Transportation Systems, Erie County’s largest employer.
GETS’s revenues for the third quarter totaled $521 million, down 12 percent from the $595 million it recorded during the third quarter of 2001.
Third-quarter profits were also down. The company posted third-quarter profits of $91 million, down 16 percent from $108 million in 2001.
A company official said the declines were expected, given the poor economy and a down cycle in the locomotive industry.
“The economy continues to be very tough,” GE Transportation Systems spokesman Jeff DeMarrais said. “We’re seeing the year play out as we expected.” But with $1 billion in new orders, the company could see better results in 2003.
GE Transportation Systems inked a $63 million contract with the Maryland Transit Administration for a state-of-the-art signaling and field communications system.
The unit also completed its acquisition of certain assets from Railway Technologies Inc. — a move that continues GE Transportation Systems’ move into remote-control yard switch products.
DeMarrais said the company has not yet made public its projections for 2003.
Union officials have said they expect GE Transportation Systems to fill about 460 locomotive orders by the end of this year and produce roughly the same total in 2003.
The expected 2002 total is ahead of the company’s original projection of about 350 orders.
GE Transportation Systems has seen orders for new locomotives decline steadily since 1999, when it filled orders for 911 locomotives.
As a result of that decline in orders, GE Transportation Systems outlined plans in January to eliminate more than 1,100 positions worldwide by the end of the year.
Of that total, about 900 were expected to come from its Lawrence Park locomotive plant through a combination of layoffs, early retirements and the outsourcing of 214 jobs to other plants.
GE Transportation Systems and United Electrical Radio & Machine Workers Local 506 reached a deal in May to protect 167 of those jobs as the company agreed not to send those positions to other plants.
In addition, union officials have said the company has been less aggressive than expected in cutting jobs.
As recently as late September, union officials said the company had laid off about 110 people. Another 250 opted for early retirement.
GE Transportation Systems said it still expects to hit its revised target of 750 positions.
Despite the decline in locomotive orders, GE Transportation Systems has been able to offset some of the lost revenue by increasing its service business and by expanding its signaling business, DeMarrais said.
For the first nine months of 2002, the company’s revenues were $1.6 billion, down 7 percent from $1.72 billion in for the same period in 2001. Profits dropped from $280 million in 2001 to $268 million in 2002, a decline of 4 percent.