Alstom India to supply trains for two more metro projects in India: Alain Spohr

Of all the projects that we had bid for last year, we have won two projects. We will supply 66 metro cars to the joint venture between Tata Group firm TRIL Urban Transport and Siemens Project Ventures for the Pune metro project. We have started the execution of the Rs 693 crore project, which will connect Hinjewadi Rajiv Gandhi Infotech Park with Shivajinagar via Balewadi in Pune.

We have also emerged as the lower bidder to supply metro cars for another metro project in south India, but are finalising details of the project.

With the entry of local players in the past two years, how do you see competition shaping up in the metro segment in India?

In the last couple of years, we have seen the entry of BEML and Titagarh Wagons in the metro car manufacturing segment, which has increased competition in the space. They are respectable competitors and their entry has brought a big fall in prices of metro projects in India in 2019 and 2020.

But I think with rising raw material prices, we expect prices to stabilise as higher raw material prices will affect all players equally.

Commodity prices, especially of steel and crude, have risen over the past year and are expected to remain high. How will this impact margins?

In some projects, we have contract price adjustment and in those projects we are reasonably protected, but in other projects which have a fixed price we have been impacted.

And if you combine the inflation and the delay of execution, it starts to have a very significant impact on the execution on some of the projects. I request the government to intervene and look at these projects.

What are the biggest differences in project execution, for both the metro and Indian Railways, between India and other countries? How can the Indian government improve operations?

One of the main drivers for both the Indian Railways and the metro ecosystem in India would be to speed up execution of projects. At the moment, the time between the government inviting bids for a project and project commissioning is quite large.

Currently, the initial phase of development for any project takes a lot of time in India. It also takes a lot of time to obtain all permits to start project execution and financial closure also takes a lot of time…

The Indian Railways should also look to set up an independent body to supervise project execution and step in to make quick decisions when projects are stalled.

What is your manufacturing capacity in India for locomotives and what is the capacity utilisation? Are you looking at capacity expansion?

At the moment, we can manufacture 240 electric locomotives per annum from our manufacturing facility in Madhepura, Bihar. The Madhepura facility is at 80 percent capacity utilisation, manufacturing electric locomotives for the Indian Railways for freight movement.

Our manufacturing facilities in Savli, Gujarat, and Sricity in Andhra Pradesh have an annual capacity to manufacture 480 metro cars and bogies each. The Sricity and Savli facilities are currently operating at about 50 percent capacity utilisation, manufacturing for international and domestic projects. We also manufacture components from our facilities in Maneja, Gujarat, and Coimbatore, Tamil Nadu.

We employ close to 10,000 people in India and have six industrial sites. We already have a very strong base in the country… and over the next few years, we will focus on optimising the use of these facilities.

What is your expectation for how the rolling stock industry in India will grow over the next two to five years?

India is at the cusp of transformation in mainline and urban mobility and sustainable mobility will play a key role in helping the government. The focus of the Indian Railways has shifted back to the addition of rolling stock to its mainline and over the next few years, this is going to be a big opportunity.

The government coming out with large projects is going to shape the rolling stock market in India. It will not only be a big opportunity for rolling stock manufacturers but also for subcontractors and sub-vendors that manufacture equipment and even raw material.

How long did it take to make the first semi-high-speed Regional Rapid Transit System train and how many more will you supply in 2022-23?

We have taken around 10 months to manufacture the first semi-high-speed Regional Rapid Transit System train. The train was designed in Hyderabad along with our team in Bangalore and in close cooperation with our experts in Europe.

We have handed over the first six-car train set to the National Capital Region Transport Corporation and will hand over the second one very soon. Our aim is to supply the trains to the NCRTC so that they can start testing these trains and roll them out for usage by next year.

Once all the testing by the NCRTC is completed, we will start serial production and will roll out nearly three trains every two months. We will complete the delivery of all 210 regional commuter and transit train cars by 2024.

Orders from metro projects are expected to slow down in the next five years. How are you looking to diversify your operations?

In the last five years, we have worked with the Indian Railways directly while also supplying trains for metro projects across the country. Alstom is currently indigenously manufacturing 800 fully electric super-powered double-section locomotives of 12,000 HP capable of hauling 6,000 tonnes. Till now, we have supplied nearly 200 of our 12,000 HP locomotives to the Indian Railways.

We are also working here with the Indian Railways to set up freight corridors in the country. We have executed projects to lay down around 350 km of lines in the dedicated freight corridor till now.

We are also working with the Indian Railways as a component supplier by supplying propulsion systems and train control systems for locomotives.

Have you been negotiating with any private party that is looking to get into private train operations in India for the supply of wagons?

We were in talks with three private players to supply rolling stock to them when they were bidding for private train operations in 2020, but unfortunately, the tender from the government was scrapped. We are waiting for the government to come out with a new tender and when it comes we will support private players. We will look to supply goods for passenger locomotives and electric locomotives for freight movement to private players. Unfortunately, no private player has approached us till now for freight locomotives.