GE and Wabtec finalize merger
Photo By: Dave Lustig
Brendan Derry, Business & Tech Editor
This week marks the end of an era of General Electric Transportation in Erie as Wabtec Corporation settles a deal to take over the GE plant as a merger between the two was finalized Monday morning. The dealings have been discussed since late May but an agreement has finally been reached. Wabtec is especially pleased with the outcome as the combined company, to be named Wabtec, will be added to the list of Fortune 500 companies. Raymond T. Betler, President and CEO of Wabtec gave a statement following the signing “This is a once-in-a-lifetime opportunity to bring together nearly four centuries of collective experience to create a technologically advanced leader with a highly complementary set of capabilities to move and improve the world. Today, we are a stronger, more diversified company ready to better serve customers across the globe and capitalize on new growth opportunities at an attractive point in the cycle.”
This merger is incredibly beneficial for each individual company. Wabtec is based in Wilmerding, PA and they specialize in rail and freight service and production while also creating a number of related products and services. Such a business model has an awful lot to gain from a company like GE. The technology acquisition alone was quite a haul for Wabtec but the combined capabilities are projected to cause exponential growth in the new company. Because it was just GE’s transportation sector, there are a number of GE’s assets that they will not have assess to but the Transportation sector has been a pillar of locomotive engineering. Wabtec now has the ability to produce higher quality products in a far more efficient manner with the added help of GE’s methods and facilities. The market growth and combined experience shows a lot of potential success coming from this merger.
The name GE will no longer be a staple of Erie but that doesn’t mean the economic growth it brought will disappear. GE stated last November that they were looking to get rid of their transportation sector as they were falling increasingly further into debt with the market losses taking a major toll. It primarily affected their ability to fulfill orders which have several billion dollars backlogged that Wabtec will now take over. The ability to fulfill these orders will likely bring the merged sector out of debt. With the aid of another capable company, the GE plant in Erie has the potential to grow and offer more jobs to the surrounding community. Ultimately, this is a much better outcome than the plant being closed down entirely.
GE Transportation was founded in 1907 and has had a major impact on the surrounding area. You can drive past the cookie cutter houses put up for the workers needed for the newly built plant. All of them are still in rows near the plant and there are still many workers in the community. Many of which are greatly concerned about their new employers. Workers sought new contracts before a finalization but Wabtec is looking for concessions on wages and workers coming into the company are undoubtedly upset. It is a tough situation as the workers may strike but union and company heads feel that they can come to an agreement soon.