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Viewing cable 10VIENNA54, Austrian Rail Industry Targets U.S. High-Speed Rail

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Reference ID Created Released Classification Origin
10VIENNA54 2010-01-13 13:21 2011-08-26 00:00 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Vienna
VZCZCXRO6926
RR RUEHIK
DE RUEHVI #0054 0131321
ZNR UUUUU ZZH
R 131321Z JAN 10
FM AMEMBASSY VIENNA
TO RUEHC/SECSTATE WASHDC 4012
INFO RUCPDOC/USDOC WASHDC
RUCNMEM/EU MEMBER STATES
UNCLAS VIENNA 000054 
 
SIPDIS, SENSITIVE 
 
USDOC FOR 4212/MAC/EUR/OWE/PDACHER 
 
E.O. 12958: N/A 
TAGS: ELTN EIND BTIO TSPL AU
SUBJECT: Austrian Rail Industry Targets U.S. High-Speed Rail 
Stimulus 
 
1. (SBU) SUMMARY: Austria's railway industry is exploring potential 
investment and sales in the United States connected to the U.S. 
stimulus funding for high-speed rail.  Austrian companies (some of 
which are already major investors in the U.S. rail sector) recognize 
the political imperative to create American jobs.  Austrian 
companies are competitive in rail sub-sectors including switches, 
high-tech steel rails, track-laying equipment, and advanced bogies 
(wheel assemblies).  Though this is clearly a private commercial 
initiative, Post will continue to monitor technology partnerships 
for any related opportunities to promote additional investment in 
the United States.  END SUMMARY. 
 
2. (U) On December 4, railway industry consultants briefed Emboffs 
on potential moves to increase investments in the United States (and 
future sales) in connection with the $8 billion in Recovery Act 
funds which will flow into several regional high-speed rail 
projects.  The Austrians say their interest is motivated less by 
short-term funding prospects than by the long-term growth potential 
it represents for the under-developed U.S. passenger rail market -- 
opining that energy/climate concerns will limit further expansion of 
air travel in many U.S. travel markets -- in particular since any 
rail project would be spread over decades.  Austria's rail sector is 
already selling into China (see Siemens Austria below) and sees the 
U.S. as another growth market. 
 
3. (SBU) According to Hans Georg Andras of Panrail (an Austrian 
railway consultant and integrator), Austrian industry understands 
the commercial and political imperative of investing in the United 
States and creating U.S. jobs in connection with long-term sales 
there.  Austrian rail producers are already significant employers in 
the U.S. and that presence would grow in connection with future 
sales.  Panrail and other Austrian companies are members of relevant 
U.S. industry associations and know the sensitivities surrounding 
large procurements (opining that U.S. freight incumbents want to 
frame the debate on high-speed rail). 
 
Austria's Rail Equipment/Construction Players 
- - - - - - - - - - - - - - - - - - - - - - - 
 
4. (U) The major companies in Austria's rail equipment and related 
construction industries are: 
 
--  Voestalpine AG (www.voestalpine.com/ag/en.html)is a 
multinational producer of high-technology steel products with EUR 11 
billion sales/year. Its subsidiary Voestalpine Rail 
(www.voestalpine.com/schienen/en.html) makes the ultra-long, 
specially heated-treated rails needed for high-speed rail systems. 
Voestalpine is also the world lead in switches:  its U.S. subsidiary 
VAE Nortrak (www.nortrak.com) has five U.S. facilities which 
manufacture switches, spikes and lighter rails.  Since high-speed 
rails are too long -- 120 meters and longer -- to ship overseas in 
large quantities, Andras indicated that Voestalpine is considering 
partnering with or investing in Steel Dynamics (a U.S. steelmaker 
based in Indiana) to build new milling processes to make long, 
high-quality rails. 
 
-- Siemens Austria (www.mobility.siemens.com) manufactures bogies 
(wheel-chassis assemblies) for high-speed rail cars at its facility 
in Graz, reportedly the largest such facility in the world.  Andras 
reports that Siemens currently ships 3000 bogies annually to Chinese 
high-speed rail projects.  COMMENT:  We note that Siemens operates a 
light-rail car manufacturing plant in Sacramento, California; 
according to media reports, Siemens has acquired adjoining property 
with the declared intention o building a high-speed railway car 
assembly plan. END COMMENT. 
 
-- Plasser & Theurer (www.plassetheurer.com/index_en.htm) is a 
medium-sized Austian firm that manufactures track-laying equipmentand track maintenance equipment.  It has supplied quipment to 
Japan's high-speed rail network for any years.  It has a small 
American subsidiary based in Virginia (Plasser American) which 
handles sales, service and repairs. 
 
--  There are two Austrian railroad construction firms, Swietelsky 
and Rhomberg Bahntechnik, with experience in building the special 
ballasted flexible roadbeds needed for trains to reach speeds of 200 
mph safely.  The larger of the two, Swietelsky 
(www.swietelsky.at/index.php?id=125&L=1), has 70 years of experience 
in railroad construction in central Europe and the UK, recently 
winning a tender to build a 165 km high-speed rail link in Bosnia 
Herzegovina.  Rhomberg Bahntechnik 
(www.bahntechnik.com/Englisch/index_e.html) is a medium-sized 
construction company specializing in the building of train roadbeds 
and tunnels.  Rhomberg's major projects include work on the 
high-speed rail link from Italy to Germany through Austria.  Neither 
Swietelsky nor Rhomberg currently has a presence in the United 
States. 
 
EACHO