Aurizon and Progress Rail Services, part of Caterpillar, signed a long-term maintenance and parts supply deal, under which Aurizon aims to deliver a significant reduction in its operational and capital expenditure on non-core rolling stock maintenance through to 2024.
The non-binding MoU is expected to be converted to finalised commercial agreements ahead of an expected implementation from 1 July 2016 to October 2024.
The initiative is part of Aurizon’s ongoing transformation program to reduce costs and achieve efficiency gains across the company, which targets USD 380 million of efficiency benefits for the period FY2015 – FY2018.
In addition to cost savings, the deal will facilitate a long-term strategic partnership between Aurizon and a global locomotive original equipment manufacturer (OEM) that supplies rail equipment and solutions to a range of international customers including the Class 1 North American railroads. Aurizon and Progress Rail will also collaborate on development of more efficient, cost-effective supply chains for the delivery of parts and componentry for Aurizon’s national rolling stock fleet.
Aurizon conducted a competitive tender process for the new contract through a select group of Australian and offshore companies who have established rolling stock overhaul and component capability.
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