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Adtranz gets two years to move into profit

01 Jul 1999

UNVEILING a full-size mock-up of the Innovia peoplemover at the City Transport exhibition in Toronto (right), Adtranz President & CEO Rolf Eckrodt confirmed on May 24 that the company was relying on its modular product platform strategy to return the business to profit within the next two years.

Officially known as DaimlerChrysler Rail Systems since January 1 this year, Adtranz sees the product platforms launched on March 16 1998 as an important element in its financial recovery. 'They should create competitive prices', said Eckrodt, because rationalised manufacturing could bring costs down by around 25%. Adtranz has already won an order from Nantes for its Incentro light rail vehicle, and the prototype Innovia was due to start tests in Pittsburgh during June.

Newly-appointed Executive Vice President, Marketing & Services, Bert van Dijk expects the first cost of rolling stock to 'stabilise', because 'the focus will be more and more on life cycle cost.' Asked whether Adtranz was really prepared to resist pressure from customers to introduce costly variations into the modular designs, Eckrodt said firmly 'we shall have the courage to say no'.

Eckrodt confirmed that there was still over-capacity within the company which would have to be eliminated. With 1400 job losses already announce in Germany, he said that plants in other countries were still being reviewed; their future would be announced when this process had been completed. Adtranz was being given its chance to get into profit by its 100% owner, DaimlerChrysler, but it would 'not be forever'. When pressed, he put a limit of two years on the time allowed for restructuring.