China’s CNR to begin exporting locomotives to Brazil in 2008

19 July 2006

Sao Paulo, Brazil July 19 – China Northern Railway (CNR) has signed an accord with Brazilian railway company Engenharia e Investimentos Ferroviários (EIF) for supply of locomotives, which will begin to arrive in the Latin American country from 2008, company sources have announced.

The deal signed Tuesday between the Chinese state company and the Brazilian firm also includes the carrying out of a viability study on the assembly of locomotives in Brazil from 2010 using Chinese-manufactured parts.

The two railway companies currently have an accord on maintenance, leasing and financing of new locomotives.

China and the United States are the only countries that manufacture railway locomotives and Brazilian railway operators have to date mainly imported second-hand US equipment.

João Gemma, CEO of EIF, said the final cost of a Chinese locomotive for Brazilian operators is about a third less then the same US-supplied product.

Brazil currently has three main railway operating companies; Companhia Vale do Rio Doce, ALL and Ferrovia Centro Atlântica (FCA).

ALL (América Latina Logistica) is Latin America’s largest rail operator with 20,495 kilometers of track in Brazil, as well as parts of the Argentinean network.

The company operates in the south, southeast and central-western regions of Brazil with a fleet of 960 locomotives and 27,000 items of rolling stock.

The only railway company listed on the Sao Paulo Stock Exchange (Bovespa), ALL posted net results of US$ 78 million in 2005, up some 90% over the previous year. (macauhub)