Why doesn’t the United States have an Alstom?

Alstom, the French conglomerate, has been much in the news lately. It’s all good things for Alstom. In addition to the deal to give birth to Amtrak’s next generation of high-speed, high-capacity, low energy consumption, tilt engineered trains, Alstom has recently announced several remarkable contracts in other aspects of railroading. Ranging from transit to heavy rail signaling, Alstom’s references include, or will include, maintenance of literally all of Ottawa, Ontario’s light rail system, trams, tramways and signaling in Australia, overhaul of Baltimore’s light rail system, PTC in New Jersey (on the Northeast Corridor), Switzerland’s first high-speed line, and signaling systems in Italy. I could go on.

The point is that Alstom—sometimes in partnership with Bombardier of Canada—has its corporate rail transportation and rail engineering fingers in a lot of worldwide pies. The closest comparison with any American company (major hesitation in calling any company truly American any more) is General Electric. GE has its fingers in a lot of pies, but the vast majority of them are not in rail transportation. When GE is in rail, it is in a big way, with locomotives and propulsion tech that blows away any other American competitor. But GE also let Alstom have its signaling business and agreed to “collaboration” in the transport sector in a narrowly reported 2014 deal in order to take over Alstom’s energy business.

The Buy American provisions of most government and, therefore, transportation agency contracts muddy the landscape a bit. It’s true that Alstom is multi-national, but it’s also true that they employ a lot of people in America. It’s also true that so did General Motors’ Electromotive Division, so did Pullman-Standard, so did Budd and ACF. Why didn’t any of those grow into an Alstom?

One reason is that European nations have always flirted with government ownership or control of rail. With the exception of a few short periods, government operation of rail is relatively new in America. Another reason is that European nations invested heavily in rail infrastructure in the late 19th and early 20th centuries and did not have the post-World War II prosperity to trade it all in for rubber tires and concrete highways. Third, and possibly most significantly, Europe saw the value of High Speed Rail earlier than America, and embraced it fully, taking a cue from the post-war bounce back of Japanese rail systems and the bullet trains they spawned.

Maybe a certain amount of jingoism kept Americans from embracing what appear to be purely foreign ideas. No political will ever developed as it did with the Interstate Highway System or the space program.

So Alstom had an open window, a sill with a lot of pies on it, and many, many miles of railroad on which to start its rise to the top. Once successful, the TGV embellished Alstom’s reputation and bought Alstom entrée to other world capitals and a wide variety of world economies. Lately America.

American outfits—the ones named above and more—tended more to try to impress the American railroad model on the rest of the world, while Europe and hundreds of other places saw Alstom as a company that could conform to their model of rail transportation and leave the big, overbuilt, and sometimes over-engineered American designs out of it. To a significant extent, world players in railroad technology do not have an easy time doing the reverse and conforming to those high American standards. See Nippon-Sharyo. Alstom seems to have jumped that hurdle with height to spare.

The final reason we don’t, and probably won’t, have an Alston-like American corporation on the world stage in the near future is that Alstom, Bombardier, Nippon-Sharyo, China South (and North), Siemens, Ansaldo, and Kawasaki have left little remaining room for competitors to find a way in. General Motors and GE had 16% of the worldwide market in 2010, as reported by Worldwatch, and GM’s selling of EMD along with EMD’s recent focus on its slow progress in meeting Tier 4 diesel standards in the United States have probably reduced that share to around 9% for both companies. In any case, both are still locomotive-focused and cannot, and may not ever, field the spectrum of products or services that Alstom has to offer. With the reduced demand for locomotives in the face of the rail freight slowdown in the US, neither company can look to American sales to finance big sales pushes in unproven territory.

So I guess the answer to my question is, “The market doesn’t need one.”

(Current news about Alstom: https://click.publicaster.com/ClickThru.aspx?pubids=0895%7c602212%7c42367%7c96451&digest=eDdmS0uw%2bp8NZWf4PIgsDw&sysid=1

©2016 – C. A. Turek – mistertrains@gmail.com

(Charles A. Turek is a writer and novelist based in Albuquerque, NM. After four decades working in areas of the insurance industry related to transportation, he now writes on all aspects of American railroading. Charles is a political conservative but believes in public funding of passenger rail as a part of the federal government’s constitutionally conservative obligation to provide for defense and public infrastructure so that private enterprise may flourish.)