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Bombardier fast-train pitch in high gear

(Canada.com posted the following Montreal Gazette article by Nicolas Van Praet on March 14.)

MONTREAL -- Bombardier Inc. yesterday launched a North American marketing blitz for its new JetTrain and set itself squarely on a collision course with airlines and bus companies that oppose high-speed rail.

Montreal was the first stop on a show-and-tell tour that will take Bombardier's JetTrain team next to Toronto and then to Calgary before moving into the United States.

The company has identified 13 corridors in North America for high-speed rail, including Quebec City to Windsor.

Bombardier officials phrase it in more polite terms, but the goal of the tour is to generate hype and plant the JetTrain firmly in the minds of Canadians.

But another likely outcome, as the federal government considers loosening its purse strings for a high-speed rail project, will be a unprecedented showdown between rail and plane and bus interests.

Bombardier Transportation officials wasted no time yesterday in touting their product as the best ecological alternative for inter-city transport.

At a media briefing steps away from Montreal's Central Station, Lecia Stewart, the company's vice-president for high-speed rail in North America, said the JetTrain will reduce greenhouse-gas emissions by 40 per cent compared with automobiles travelling on the same routes.

She added that the JetTrain avoids having to buy up land for roads and will reduce the congestion clogging cities.

While air and car travel will always play an important role in Canada's transportation system "consumers are ready to consider a different balance," Stewart said.

Look to the U.S. to see the effects of what she's talking about.

On the Washington-New York route, Bombardier's Acela high-speed train has captured 65 per cent of the air/train passenger market between those two cities. Just three years ago, the situation was reversed.

William Spurr, president of Bombardier Transportation North America, said in an interview that trains could take over from planes in certain corridors.

Spurr insisted, however, that Bombardier's rail unit doesn't want to battle with other modes of transport.

"There is room for everybody."

Canada's airline trade body, however, is gearing up for a fight. It says a high-speed train could wipe out planes altogether in the Quebec City-Windsor corridor.

"The plan is to take us out," said Warren Everson, vice-president of the Air Transport Association of Canada.

Together with bus companies, ATAC is already heavily lobbying federal finance and treasury officials and members of Parliament who represent constituents living outside the areas Bombardier proposes to serve with its train, asking them to oppose a fast-train plan.

Airlines and bus companies are opposed to any handout from Ottawa for the operation of a railway that would compete with private companies, which don't receive any subsidies. They say the $300 million a year Ottawa now hands Via Rail is enough.

"There is a very bad balance toward different modes of transportation in terms of federal priorities," said Sylvain Langis, president of busline Autocars Orléans Express.

"Everything goes to rail," Langis said.

Bombardier's media blitz follows a speech this week by Via chairman Jean Pelletier, former chief of staff to Prime Minister Jean Chrétien, in which he said he was convinced Ottawa will eventually fund a high-speed rail project with Via as the service provider.

Bombardier recently bid on a high-speed rail project in Florida, where it wants to implement the JetTrain.

The company's train unit is considered a solid part of its operations now as its aerospace business falters.

Dominion Bond Rating Service yesterday downgraded Bombardier's ratings on senior debt to BBB (high) from A and said the trend for the company is negative, largely because of declining jet orders.

Last week, Bombardier issued a profit warning and cut 3,000 jobs.

"It will take at least two to three years to turn Bombardier around," Dominion said.

Friday, March 14, 2003

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