Alstom's TGV kept smashing rail speed records while the company nearly went broke
In 2007 a French high-speed train touched 574.8 kilometres per hour, still the fastest any rail vehicle had gone. Its maker, Alstom, had come within reach of liquidation only four years earlier, weighed down by more than five billion dollars of debt and a share price that had lost nine-tenths of its value.
The name began as Alsthom, stitched together in 1928 from Als, for the Alsace engineering firm Societe Alsacienne de Constructions Mecaniques, and thom, for the French arm of Thomson-Houston. Buying a locomotive maker in Tarbes in 1932 took it into transport. A 1976 merger with shipbuilder Chantiers de l'Atlantique added ships, and the following year it built a generator for the Paluel nuclear plant that set a record 1500 MW output.
Its first TGV reached SNCF in 1978. The trains broke the world rail speed record in 1981 at 380 km/h and again in 1990 at 515.3 km/h, and in 2001 one covered 1,067.2 kilometres between Calais and Marseille in just under three and a half hours, 3 hours 29 minutes to be exact. A 50-50 merger with Britain's GEC in 1989 created GEC Alsthom, which built the Channel Tunnel's Class 373 trains; the first set was finished at Belfort in 1992. After a Paris listing in June 1998, it dropped the h and became Alstom.
Expansion then turned sour. A 4 billion dollar charge over a flawed turbine design inherited from ABB, plus the collapse of customer Renaissance Cruises, left it in crisis by 2003. The French state took a 21 per cent stake for 772 million euros in 2004 amid an EU-approved rescue, and construction group Bouygues bought that holding for 2 billion euros in 2006. The marine business went to Aker Yards the same year.
Legal trouble followed. After a US Justice Department investigation, executive Frederic Pierucci was arrested at JFK airport on 13 April 2013 and held for 14 months, and in late 2014 the company admitted to bribery and paid a 772 million dollar fine. British prosecutors separately charged its UK arm over contracts in India, Poland, Tunisia, Lithuania and Hungary. Meanwhile trains remained the core: in November 2014 it won a 429.4 million dollar deal to modernise 85 Mexico City Metro trains.
Source: Alstom
