Progress Rail sues Wabtec

Caterpillar’s rail division cites anti-trust issues

Caterpillar’s rail division has sued rival Wabtec in federal court, alleging it abused its power in the market for diesel long-haul locomotives.

Progress Rail wants the federal judge to force Pittsburgh-based Wabtec to divest the GE Transportation Unit it bought in 2019 in an $11 billion deal.

According to the suit by Progress Rail, the freight rail industry is integral to the U.S. supply chain and the functioning of the U.S. economy more broadly.

“Freight locomotives provide the muscle necessary to transport the essential goods and resources millions of Americans rely on every day. Robust competition to develop, manufacture, and sell freight locomotives and complimentary cab components is therefore essential to ensure the freight rail transportation industry and the consumers who rely on its services receive the best products at competitive prices,” the suit states.

But Progress Rail argues that in 2019, the competitive balance critical to the freight locomotive industry was disrupted when Wabtec acquired General Electric Co. Transportation.

“That combination merged the sole supplier of certain key freight locomotive inputs (Wabtec) with the dominant supplier of finished freight locomotives and other cab technologies (GE Transportation),” the lawsuit alleges. “It created a vertically integrated entity with dominant positions in multiple products and the incentive and ability to engage in anticompetitive exclusionary conduct to harm the competitive process and consumers.”

Progress Rail said Wabtec is one of the only or leading manufacturers of a long list of equipment used in the U.S. freight rail network. It is the dominant supplier of freight locomotives, having manufactured and sold approximately 75 percent of active diesel long-haul freight locomotives in North America, and approximately 90 percent of new long-haul freight locomotives that comply with Tier IV rail industry standards and the Environmental Protection Agency’s (EPA) most recent emissions regulations.

Wabtec released a statement denying Progress Rail’s claims:

“We believe that Progress Rail’s recent complaint against Wabtec at its core is an unsupported attack on the merger of Wabtec and GE Transportation, which was completed over four years ago. The merger has provided benefits to the entire industry, as well as Progress Rail itself.

Progress Rail actively participated in the U.S. Government’s review of that transaction and benefitted by entering into agreements with Wabtec that transferred Wabtec technology to it as part of the United States Department of Justice and global merger clearance process.

We also firmly believe that Progress Rail’s assertions that Wabtec breached agreements or engaged in other illegal conduct are wrong. We intend to aggressively defend the case in court.”

STAY CONNECTED



Receive the information you need when you need it through our world-leading magazines, newsletters and daily briefings.

Sign up

POWER SOURCING GUIDE

The trusted reference and buyer’s guide for 83 years

The original “desktop search engine,” guiding nearly 10,000 users in more than 90 countries it is the primary reference for specifications and details on all the components that go into engine systems.

Visit Now

CONNECT WITH THE TEAM
Becky Schultz Vice President of Content Tel: +1 480 408 9774 E-mail: [email protected]
Julian Buckley Editor Tel: +44 (0) 1892 784088 E-mail: [email protected]
Chad Elmore Managing Editor Tel: +1 262 754 4114 E-mail: [email protected]
Josh Kunz Power Progress Brand Manager Tel: +1 414 379 2672 E-mail: [email protected]
Roberta Prandi Power Progress International Brand Manager Tel: +39 334 6538183 E-mail: [email protected]
Simon Kelly Sales Manager Tel: +44 (0) 1892 786 223 E-mail: [email protected]
CONNECT WITH SOCIAL MEDIA