Hitachi to ink $5.6B UK high-speed rail deal?

Tokyo, Japan-based Hitachi appears to be the front runner for a high-speed rail project in the UK with a deal value of more than ¥500 billion ($5.62 billion), Reuters reported today, citing the Nikkei business daily.

With the deal, the global electronics conglomerate is expected to provide hybrid rail cars powered by lithium-ion batteries and diesel engines. Hitachi (TYO:6501) currently brings in much of its sales from making bullet train systems, including the development of the Shinkansen bullet trains in Japan, for example.

The deal could be signed before the end of the fiscal year and would include supplying 1,400 rail cars, developing operational systems, and maintenance, Reuters said.

Approximately 20 percent of Hitcahi’s transportation system sales business comes from overseas, but the company is looking to increase that to 70 percent in 2015. Other Japanese firms looking to invest in eco-focused overseas rail projects include Kawasaki Heavy Industries, Toshiba, and Nippon Signal.

In September, Berlin, Germany-based Bombardier Transportation said its Chinese joint venture was tapped to supply 80 high-speed trains, which incorporate energy efficient technology, to China’s high-speed rail network (see Bombardier wins $2B contract for high-speed trains in China).

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