SA to benefit from trains: Gibela

By Drum Digital
26 June 2014

South Africa will benefit from the multi-billion rand project that will see Prasa replace its outdated trains, says Gibela Rail Transportation.

South Africa will benefit from the multi-billion rand project that will see Prasa replace its outdated trains, Gibela Rail Transportation said on Thursday. Gibela has been given the contract to supply 600 commuter trains over the next decade.

"South Africa a long time ago was a well-developed railway country," CEO Marc Granger told reporters in Johannesburg.

"This industry has not disappeared but has not benefited from investment for a long time."

Gibela intended helping to revitalise the industry in South Africa, as the project was not simply about building commuter trains.

The company would directly employ around 1500 people and create another 8000 jobs in the supply chain. There would be thousands of indirect jobs.

Gibela is 61 percent owned by France-based Alstom, with 39 percent locally held.

"All the know-how and technology is coming from Alstom. Over time we will transfer skills to local team members," Granger said.

The company aimed for a 70 percent level of localisation.

The Passenger Rail Agency of SA (Prasa) and Gibela signed the R51 billion contract for the project in October 2013.

"[T]hat makes the contract the largest-ever signed in the world in the railway business world for rolling stock, so it's a very significant one," the CEO said.

A total of R797 million had been budgeted for skills development, such as engineering, artisans, technicians and train drivers, with 19,000 skilled workers needed over the project's life.

The first 20 trains would be manufactured in Brazil, with South Africans involved in skills training. The remaining 580 would be built in South Africa, at a purpose-built factory in Dunnotar, on the East Rand.

The first trains, with six coaches each, accommodating 1200 people, and able to travel around 120km/h, would be delivered at the end of 2015.

They would become part of Prasa's service in June 2016. The first trains would be produced in South Africa in 2017.

Once the factory was fully established in South Africa, it would manufacture 62 trains a year, "a manufacturing rate among the highest in the world", Granger said.

A maintenance contract separate to the rolling stock contract had been signed. Its value would be dictated by the distances the trains covered.

Granger suggested the maintenance contract could be worth around R10bn over 20 years, but this was not a set figure.

Gibela had already received its first payment from the Treasury. The first five years of the contract would be paid in rands, after which payment would be made in multiple currencies.

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