Under the golden ceilings of Kiev station, the Rail Expo of Ukrainian railways took place in October 2019. A red stand dominates the others by its size: that of the world’s number one train manufacturer, the manufacturer Chinese CRRC. Opposite, the loggia of the French Alstom seems to stand on its lugs facing its competitor.
The image is striking. It sums up the current standoff between the two manufacturers for the winning of a mega-contract for dozens of freight locomotives. The market is considerable, since Ukraine has a fleet of 3,500 locomotives, of which specialists agree that 90% are obsolete today. At the end of the match: hundreds of millions of euros in turnover, work for national factories and a symbolic industrial victory on East European ground.
The contract covers 130 electric locomotives, for an amount
of 880 million euros
Nineteen months later, France finally wins. Thursday May 13, a Franco-Ukrainian intergovernmental agreement was signed. It provides, if ratified by the Ukrainian Parliament, the purchase from the French group Alstom, by the Ukrainian railways, of 130 electric locomotives, for an amount of 880 million euros, located 35% in Ukraine, and which could reach 2.4 billion if Ukraine adds maintenance over forty years.
How do you win such a battle? The world was able to access part of the backstage of the French politico-industrial lobbying which culminated in the arbitration of May 13. This tells of a long-term work of nearly five years. It will involve, alongside Alstom, three ministries (economy, transport, foreign affairs), as well as the Elysée. It combines technical and financial considerations, personal relations, diplomatic and geopolitical dimensions. A country-wide chess game.
In 2019, the French position is still fragile
But let’s come back to October 2019. We’re at half-time for the match. The French position is still fragile in the face of competition. In the ranks, we find Europeans like the German Siemens and the Czech Skoda, but who will mainly be used by the Ukrainians as hares in the negotiations. The number one opponent is the Chinese CRRC, with its ability to cut prices. “Our whole strategy will consist in torpedoing the Chinese supply”, summarizes a source close to the French Ministry of the Economy.
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