LEVALLOIS-PERRET (dpa-AFX) - The French government has placed an order for 21 high-speed TGV trains, enabling engineering giant Alstom SA (AOMFF.PK, ALS.L) to maintain production at its historic factory in the northeastern French city of Belfort.
In September, Alstom had announced plans to transfer 400 of the 480 jobs at the Belfort factory to another plant at Reichsoffen and also downsize operations following a drop in orders.
Alstom said Tuesday that a plan presented by Christophe Sirugue, France's Minister of State for the Industry, and Henri Poupart-Lafarge, Alstom Chairman and CEO, will allow to maintain the railway and industrial activities on Belfort site.
The French government, which owns a 20 percent stake in Alstom, has placed an order for 21 TGV Euroduplex and 20 shunting locomotives in addition to its confirmation of the order for 30 Intercity trains.
Alstom added that it is committed to modernizing the operations at the Belfort site, with the objective of employing 150 people by 2019 in these activities.
Together with industrial or financial partners, the company will invest in the necessary diversification of the Belfort site through the production of other rail and road vehicles.
Henri Poupart-Lafarge, CEO of Alstom, said, 'I am pleased by the announcements that have just been made and by the mobilisation of all stakeholders in order to find an industrial future for Belfort site and to consolidate the workload on other sites in France. Moreover, the fact that a strategic committee for the industry will be held soon is excellent news for the whole railway sector.'
However, the French government's rescue plan for Alstom could become controversial as President Francois Hollande had earlier promised to reduce France's budget deficit. The plan also comes just six months before the next French presidential election.
Copyright RTT News/dpa-AFX