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Transnet Freight Rail 1 064 locomotives acquisition programme, South Africa

19th August 2016

By: Sheila Barradas

Creamer Media Research Coordinator & Senior Deputy Editor

  

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Name of the Project
Transnet Freight Rail (TFR) 1 064 locomotives acquisition programme.

Location
South Africa.

Client
TFR.

Project Description
The project involves the acquisition of 1 064 locomotives – 599 electric and 465 diesel – for TFR's General Freight Business unit by 2018.

Contracts for the project have been awarded to consortiums led by four major international locomotive manufacturers – General Electric (GE), China North Rail (CNR), China South Rail (CSR) Zhuzhou Electric Locomotive and Bombardier Transportation (BT).

GE South Africa Technologies will supply 233 diesel locomotives; CNR Rolling Stock South Africa (CNR RSSA) 232 diesel locomotives; CSR Zhuzhou Electric Locomotive 359 electric locomotives; and BT South Africa (BTSA) 240 electric locomotives.

The contracts have stringent local-content, skills development and training commitments as dictated by the supplier development programme.

All but 70 locomotives will be built at Transnet Engineering plants in Pretoria and Durban. The suppliers have to date complied with and exceeded the minimum local-content criteria for rolling stock of 60% for electric locomotives and 55% for diesel locomotives.

Jobs to be Created
Not stated.

Value
Transnet announced in March 2015 that it had secured two funding agreements, collectively valued at R13-billion, with the US Export-Import (Ex-Im) Bank and Canadian export credit agency Export Development Canada, supporting TFR’s acquisition of diesel and electric locomotives from GE and BT.

The US Ex-Im Bank agreement entails a 14-year, R6-billion guarantee being extended to Transnet for the acquisition of diesel locomotives from GE. The guarantee assisted TFR in raising funds from South African financial institutions – R2.25-billion from Absa/Barclays, R2.25-billion from Standard Bank and R1.5-billion from Old Mutual.

Export Development Canada provided TFR with a 13-year, R5.24-billion loan facility, which, together with a R1.75-billion loan from South Africa’s Investec Bank, will be used to acquire 240 electric locomotives from BT.

These locomotives will be assembled at TE’s Durban facility.

Duration
One-hundred-and-forty-eight locomotives will be delivered in 2016, 492 in 2017 and 424 in 2018.

Latest Developments
Transnet reported in June this year that CSR Zhuzhou Electric Locomotive had delivered 55 of the 359 Class 22E electric locomotives it had been contracted to supply, while 34 of the 233 Class 44 diesel locomotives were delivered by GE South Africa Technologies. The 89 locomotives are, however, still undergoing acceptance testing.

Further, CNR RSSA has started production on the 232 Class 45 diesel locomotives, with two locomotives completed by June 2016.

Prototypes of the 240 Class 23E electric locomotives, to be supplied by Bombardier Transportation South Africa, have been delivered, with nine car bodies having been completed by June 2016.

Key Contracts and Suppliers
GE South Africa Technologies (supply of 233 diesel locomotives); CNR RSSA (232 diesel locomotives); CSR Zhuzhou Electric Locomotive (359 electric locomotives); BTSA (240 electric locomotives); Booyco (air conditioning for locomotive main cab); Duys (manufacture of the fuel tanks); Wabtec (radiators) and TE (manufacturing and assembling the locomotives’ platform, traction motors, bogies and alternators).

On Budget and on Time?
Not stated.

Contact Details for Project Information
Transnet, tel +27 11 308 3000, fax +27 11 308 2638 or email enquiries@transnet.net.
Booyco Engineering, +27 11 974 8640, fax +27 866 141 078 or email info@booyco.co.za.
Duys Engineering Group, tel +27 31 713 1722, fax +27 31 713 1727 or email enquiries@duys.co.za.
Wabtec South Africa, tel +27 11 974 3813.
TE, tel +27 86 172 7427.

Edited by Creamer Media Reporter

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