Siemens AG (ADR) (OTCMKTS:SIEGY)’s CEO, Joe Kaeser recently said that it might consider consolidation with the transport companies of Europe. Meanwhile, the CEO discarded the speculations about the company’s JV regarding trains with Alstom, its French peer.
Siemens’ lost battle with the General Electric Company (NYSE:GE)
In the year 2014, Siemens had lost ground to acquire energy assets of Alstom, against its stringent opponent, GE. Thereafter, it was planning to amalgamate all its rail assets with the aforesaid. These included not just the trams and trains, but also the signalling technology.
The clean execution plan by Siemens
The CEO, Joe Kaeser clearly indicated that while he cannot comment about the success or continuation of the consolidation with the European transport firms, Siemens is, still, strongly reinforced in the market. Indicating the independent stand of the company, Kaeser said that the company had all favouring conditions in order to be successful on its own. However, he said that the plan had to be executed meticulously and in an immaculate way.
The consolidated industry and the Dragon effect
Ever since this speculation came forward, the entire industry started consolidating in order to beat the rat race of competition. In the light of this consolidation, CSR CORP LTD (OTCMKTS:CSRGF) along with CNR of China, are also planning the merger. This will create the largest train-making company of the world in terms of sales, and the worth will sum up to a whooping $26 billion. It is worthwhile noting here that, China’s CNR and CSR Corp Ltd are otherwise, the arch rivals.
This combined company will also derive benefit from its domestic market because China, at present, is zeroing in on the export markets for increasing the numbers of high-speed trains. The bullet and high-speed trains have become the latest attraction of the Asian nations in the recent years.