Full Speed Ahead with Alstom

Scott Sherin, Vice President for Business Development and Strategy at Alstom, recently spoke with New York State Manufacturing Now about the company’s commitment to New York State and plans for the future. Joel Wood, Director of NAmTrans, co-hosted this podcast with FuzeHub’s Steve Melito.

Steve Melito: Welcome to New York State Manufacturing Now, the podcast that’s powered by FuzeHub. I’m your host, Steve Melito. And today’s episode will be unlike any that you’ve heard before. For starters, we are going to have a co- host, Joel Wood, who is the director of NAmTrans. And some of you may remember Joel, because we did a podcast with him several months ago, and then FuzeHub and NAmTrans also hosted an amazing event called How The North Country Keeps The World Moving. So Joel, welcome back to New York State Manufacturing Now.

Joel Wood: Thank you, Steve. It’s great to be back. The event was a lot of fun. And I’m happy to be here with yourself and Scott. Thanks for having me.

Steve Melito: You’re most welcome. Today, Joel and I will interview a very special and important guest, Scott Sherin, who is the Vice President of Business Development and Strategy at Alstom. And Scott was the keynote speaker at our virtual North Country event, but some technical challenges prevented us from getting a good recording. So, he’s graciously offered to let us interview him again here today. Scott, welcome to the show.

Scott Sherin: Thank you, Steve. Happy to be here.

Steve Melito: Great. Joel and I are going to go back and forth with some questions. I’ll ask the first one, which is this, Alstom is a household name for many of us, but it might not be familiar to some of our listeners. So, at a very high level, what would you like the world to know about Alstom?

Scott Sherin: Sure. I guess the one thing to know about Alstom is, we’re the world leader in mobility. If you look at the recent acquisition of Bombardier Transportation, we now have the strong footprint of 75,000 employees globally, we’re in 70 countries, more than 150,000 rail vehicles in commercial service worldwide. The mix of what we do is we provide trains, we provide the signaling systems that control trains, we’ll build complete new rail systems for cities that don’t have them. And the heart of what we do, particularly for the US, is right here in upstate New York. So, really appreciate this opportunity you’re giving me and giving Alstom to tell our story a little bit and let people know in the North Country and across New York State the good work that we’re doing.

Steve Melito: Good. And I’m going to go over to Joel here for several questions. Joel, take it away.

Joel Wood: Thanks Steve. Scott, for the listeners back home, can you tell them a little bit about your role and some of your duties at Alstom? And how long have you been with the company?

Scott Sherin: Sure. Thanks Joel. I’m responsible for all commercial activity in the US. So, anything involving winning new business, anything involving helping our customers work through challenges and solve some of the problems that they’re facing is within the scope of what I’m involved in. I’ve been with Alstom now for just over 11 years, but I’ve been in the rail transportation industry for more than 20 now.

Joel Wood: That’s very impressive, thank you. Scott, you mentioned earlier the merger between Alstom and Bombardier, and you also mentioned that the presence of Alstom now in New York state and in the North Country. As you probably are well aware, Plattsburgh has been a longtime home to a Bombardier rolling stock manufacturing plant. With the recent merger, what does this mean for the Plattsburgh plant? What does it mean for new technologies, for growth, for the ability for them to better compete for contracts? Can you speak to that a little?

Scott Sherin: Sure, no, I’d be happy to. While the Plattsburgh plant is new to me, upstate New York is not. I mean, I live in Rochester, been working with your colleagues down the southern tier in Hornell for a really long time. But Plattsburgh is really exciting. Bombardier, and now Alstom through Bombardier, has been president in the North Country since the mid ’90s. And there’s a reason why we’re in Plattsburgh, in Warren, Hornell. If you look at the US, 80% of all public transportation is in the Northeast corridor, and actually, really in and around the New York City metropolitan area. And so, we’re in New York and we’re in upstate New York to serve our customers. There’s this nice balance if you look at it where we’re the beneficiaries of public spending, where the state and the federal government recognizes this need for mass transportation and invests substantially downstate. And that investment downstate brings jobs to us here in upstate. It’s worked really well now for decades, it creates really good sustainable manufacturing as well as engineering jobs, and it brings innovation and allows us to work on really exciting projects. If you look just in Plattsburgh alone, we benefited with a contract for the R142 subway cars with New York City Transit for over a thousand vehicles. Similarly, with Long Island Railroad and Metro North, almost 1200 vehicles that we supply to them. And now also, with New Jersey Transit, right? We’re building their latest generation of multi- level commuter cars. So, a good decision was made, right? Invest in upstate New York, invest in the North Country, bring in leading skillset and people with real, real talent to be able to build quality vehicles, and the orders will come. It has been shown in the past, it’s happening now, and we’re expecting it to be that way for a long time into the future.

Joel Wood: That’s wonderful. Thank you, Scott. We’re happy that Alstom has decided to continue to support the plant. And we’re here, the North Country Chamber of Commerce and NAmTrans, to continue to support your operation there as you need it. I have one more question for you, and then I’ll turn it back over to my colleague, Steve. Could you pull back the curtain just a little bit, Scott, and tell us what has the merger been like for you personally in your role and maybe on a larger scope for the company as a whole? What has that looked like? What has it meant for employees and morale and the company?

Scott Sherin: Sure, no, it’s a good question. We’re five months in now I guess. I’ve stopped counting. I think it’s about five months. Look, it’s been more challenging than I thought it would be, to be perfectly honest with you. If you’re in this business long enough, if you’re in large companies long enough, acquisitions happen and it’s just part of what happens. I underestimated the size of it. If you look at what happened, I mean, double the size of our business globally, in the Americas, we’ve tripled the size of our business. And if you look at Alstom versus Bombardier, in terms of number of people, it’s been three to four times the number of people that existed before. The thing that’s been really nice is culturally, very similar. We’ve both been working with the same customers, we both have the same values, we both are innovators in the industry. So, that’s been really nice. And it’s been really great to bring these teams together and look at how we’re able to innovate, deliver more value for our customers. But look, there’s always fear, uncertainty, and doubt. We’ve been trying to move as fast as we can on the people side to give people that comfort of what we’re looking to do. But the good news is, you don’t need to look any further than Plattsburgh, and then even down at Hornell, right? There was a lot of concern. What does this mean for my job? What is this going to mean for this site? The good news is, Plattsburgh is full. The New Jersey contract is going to keep that site full for many, many, many years. And we’re going to be having questions about, well, when we win our next contracts, where are we going to put them? Do we need to expand? What do we do? If you look at Hornell, we’re full. We have the Amtrak next generation high speed train contract down there. We just won a contract for multi- level coaches with metro in Chicago. So, yes, a lot of change. I underestimated it a little bit. Teams are getting along great. We’re trying to give people the certainty and comfort that good days lie ahead. But again, you just need to look at the capacity, and you have the activity we have in our manufacturing plants. It’s a good sign that things are stable, things are growing, and it’s really going to be a story about how do we continue to grow the business.

Steve Melito: Fantastic. So Scott, in terms of the story, Alstom is a huge one in the North Country, but as you alluded, Alstom also has a presence in other parts of New York State. And so, I was hoping he could give us a little tour. What do you do in Rochester and Hornell and New York City? Let people know how big this really is.

Scott Sherin: Sure, no, it’s a great question, Steve. The thing to realize is Alstom in the US is very much a New York State Company. It’s where our center of gravity is. If you look at our sites, we have more than 1600 people. It’s in the sites you mentioned, Plattsburgh, Hornell, Rochester, New York City. We also have a facility in Kanona. So, a lot of activity. And if you look at those sites, Plattsburgh, everyone knows, right? It’s a rolling stock manufacturing site. Hornell is very similar in that regard in terms of capability, although we also do service contracts where we will modernize vehicles there as well, which is what was also done in the Kanona site. In Rochester, it’s the headquarters for our passenger and transit signaling business. If you look at railways, just like on roads, you have traffic signals. Railroads have those too, right? It’s called signaling technology. And there are these highly specialized computers that ensure no two trains occupy the same track or collide. It’s what keeps people safe. We have our project management, engineering and design offices located in Rochester. We have about 400 people down there. And then in Kanona we have a services location. Again, we’re doing modernization and doing repairs of rolling stock and trains for rail operators around the country and then, lastly, in New York City. That had been our headquarters for North America. With the acquisition of Bombardier, that’s changing. The pension fund for Quebec province is now Alstom’s largest shareholder, they own about 20% of the company. And so, as part of the acquisition, what we’ve done is we’re going to have our Americas headquarters located in Montreal. But we are still going to retain our New York City office. The MTA is right there, huge customer for ours. And down in that office, there’s a lot of activity. We have some sourcing activity there, we have communications, we have legal. But I would say probably most importantly, we have our turnkey systems business. There’s a lot of talk about this concept of public- private partnerships and turnkey systems. And depending on what comes out of Washington with infrastructure funding, we’ll probably see more of this. But the idea is, if someone’s looking to build a new rail system where they’ve never had one before. And the city of Austin is a perfect example. It’s a great city. I’ve never been, I highly encourage you to go. The city’s been growing so much, nobody likes traffic. And when cities get to a certain level of density and a certain level of traffic, they start thinking about rail as a way to move more people. And so, Austin is now looking at doing that. But they realize they don’t have the teams to operate and run the trains. They don’t have the engineers that know how to specify trains, they don’t have the skillsets to be able to lay track or to put up electrical wiring for the catenary system to power the trains. They have two approaches. One approach is they can issue 10 to 20 different contracts to separate companies and then have them figure out how to put the system together. Or they can hire one company to manage all of them for that. It’s like if you’re doing a renovation on your house and you hire a general contractor or if you hire everybody separately on your own and then you manage the project yourself. So, our turnkey systems business headquarters in New York, and the team that leads that activity and leads that effort is run out of there.

Steve Melito: You mentioned a word earlier, sourcing. And it brings to mind the fact that a lot of small to medium manufacturers across New York State would probably very much like to be part of the Alstom supply chain. How do they go about engaging Alstom in that way?

Scott Sherin: It’s a great question, and I’ll answer the question, but I’ll share something first with you that I just learned that I found to be really interesting. We spend nearly a billion dollars a year with suppliers in the US and Canada, which was actually a bit surprising to me. It’s the power of By America. There’s a law where 70% of all procurements have to have US content in them. So, it drives this massive need for suppliers. 80% of what we’re spending right now is in New York and Pennsylvania. So, we’re already having a huge impact locally in the community and working with a huge supplier base. But the way to do it is to connect into our sourcing organization. And I would say for companies in and around Plattsburgh, the best entry point is probably through the Plattsburgh site, and to reach out and to contact people there, and then they can help navigate and identify where different companies might be able to get involved. And I’d also highly and strongly encourage any MWBE firms or DBE firms to contact us. We’re seeing increasing demand and interest, not just for By America, but for minority owned firm, women owned firm, disadvantaged firms, veteran owned firms. There’s policies in place, both federal level and state level that create an obligation, and quite frankly, I’d say a willing desire on our part to work with those firms and bring them into our supply chain. So, entry point, certainly through Plattsburgh, can also do it through any of our sites. But I’m glad you mentioned it because there’s a lot of opportunity and we’re looking for companies to partner with.

Steve Melito: That’s great. And you had mentioned earlier Canada, and NAmTrans is a tremendous asset on both sides of the border. How will you work with NAmTRans, do you think?

Scott Sherin: Well, NAmTrans is new to me. I’m developing a new appreciation for the organization. And the little bit that I’ve learned is, like NAmTrans, we’re present on both sides of the border. As I mentioned, our regional headquarters are in Saint- Bruno, but I have a very US focused mission. We look forward to continuing our relationship with NAmTrans. We don’t know everything, we learn every day. And just like we can give a lot of advice and a lot of guidance to people on what needs to happen in the world on mobility, we’d really love to continue and strengthen our partnership with NAmTrans, and help us understand how we can leverage that to create growth in the region. We really have a strong interest in seeing the equipment and technology cluster grow. It’s remarkable to me what’s happened in the North Country. We, at one point, before the acquisition, have talked about how do we create this transportation cluster in New York. You look at the aviation industry, and the Pacific Northwest has become known as this hotbed for industrial activity around aviation. There’s no reason why New York shouldn’t be that way. You talk about the sites that you had mentioned, just that are now Alstom sites. You also have other suppliers here. CAF is here, Kawasaki is here. There’s a huge concentration, not just in the rail industry, but also in the bus industry and others, that quite frankly, I don’t know how you did it. It’s remarkable to me, the companies you’ve pulled into the North Country. If we can continue to work together to build that strength, I have no doubt we’ll continue to create jobs together, and quite frankly, look forward to deepening that relationship and figure out how we can work together to make some of these ideas become reality.

Steve Melito: Fantastic. And Joel, I’m going to have you ask a few more questions.

Joel Wood: Absolutely. Thank you, Steve. And just to piggyback off your last answer there, Scott, I think between Alstom, the companies that we have in the cluster, and our tremendous partners like FuzeHub, I think we can manage to do just that. You did mention land transport, buses. What are some of Alstom’s efforts and initiatives to move towards green and more energy efficient technologies? I think your company is a leader in that field. Can you give us a sneak peek or a little more information on what you’re doing in the realm of green transportation?

Scott Sherin: Sure. Yeah, no, we’re actually doing quite a bit. There’s a lot of talk right now about hydrogen in the rail space. And unfortunately, well, I guess fortunately, it’s talk. We need to get it to be more than just talk in the US. We’ve actually been running a hydrogen train moving passengers for two years now in Germany. And what happened there, and what’s really interesting is, as we’re seeing more renewable power be put in place, there’s an upside and downside of that. The upside is, it is green, people like that. The downside is, the sun doesn’t always shine, the wind doesn’t always blow when you want it to, when there’s power demand. And so, what’s happened in Germany and in California to some extent, they’ve been trying to find ways on how do they store that energy and make it available for later use and what’s happened in Germany is, they’ve been generating hydrogen. And so, what the railroads have realized there is, instead of burning diesel fuel and quite frankly paying for the diesel fuel, I mean it’s more about dollars and cents as much as it is about being green, probably a little bit more so, they’re now effectively getting free energy in hydrogen that’s being stored to power their trains. So, it’s reducing the cost of operating these trains. Typically, fuel costs are your second highest expense. And it’s green. So, we’re now in active discussions with the Department of Energy, with the Department of Transportation, with multiple transit agencies, and also Class I railroads, about pilots we could potentially be doing to actually show that this technology works, that it’s viable, and then figure out where the best place is to introduce it into the market. I expect, if we’re pushing quite hard, I’d love to come back and meet with you guys again within a year’s time to announce that, hopefully, we won our first contract. We’ll see. But I mean, that’s the kind of pace we’re moving at. We’re trying to move very quickly and have the US be in a position to take advantage of that. And then, on the battery side, it’s the other technology that’s being deployed. And again, it’s trying to reduce the amount of diesel fuel that’s being burned. There’s a green benefit of that, and there’s also a savings to the customer. On the battery side, we have a contract with Long Island Railroad. We’re doing a pilot with them for trains. And we’re also, again, talking with multiple Class I freight railroads, we’re talking with multiple transit agencies. They all have different reasons for wanting to do it.
In the Long Island case, and in some of the other cases, the thing that’s interesting is a lot of them have electrified in their cities. It brings them a lot of benefits in terms of cost reduction and also lower emissions or no emissions depending on the technology. But as these lines get further away from the cities, the electrical grid’s not there anymore. And so, they switch to diesel. And over time, as these cities have grown and as they’ve expanded, you now have trains going right by houses, belching out diesel smoke, and they prefer not to do that. So, what we’re doing is we’re converting some of these trains to hybrids, to now run on batteries. So, you don’t need to turn the diesel engine on. You leave the electrified territory, you continue running on battery. It’s a really interesting area. We see it happening in the automotive industry, it’s coming to the rail industry. And we’re going to be one of the innovators, we’re going to be one of the first movers. And as that happens, when you see these technology shifts, it also becomes a massive driver of growth and job creation because all of a sudden everybody wants the new thing and it becomes a big push. So, it’s something we’re really… It’s not there yet, we’re very close. And it’ll definitely bring good things to our region.

Joel Wood: Thank you, Scott. And then the last point is, I guess it’s less of a question and a little bit more of a statement or an ask. Over the years, over the past 20 plus years since Legacy Bombardier opened their facility in Plattsburgh, the North Country Chamber of Commerce has hosted a variety of elected officials at the plant, state assemblymen, chairs of the Department of Transportation state level, to show them the capabilities of the site there. We’re going to continue to do just that, we think it’s very important. But Scott, we’d like to formally extend an invitation for you to come and visit the plant if you haven’t had the opportunity to do so, or at least come tour it with us, as well as the Alstom leadership. We’d love to host you, and we’d love to bring you out maybe for a Michigan, which is a local delicacy here in the North Country in Plattsburgh, if you take us up on it,

Scott Sherin: I will absolutely take you up on it. I actually visited my first Legacy Bombardier site on Tuesday. I was out in Pittsburgh, California, to see where we’re doing some work on the BART metro cars, for their fleet of the future that we’re delivering for them. And I will be in Plattsburgh before the end of the summer. I’ve been through the North Country in the past many times for family and recreation reasons. It’s a beautiful area up there. And I really look forward to coming up there to see the plants. Joel, one thing to share with you. As part of my scope, I also have the public affairs side of activity as well. As does Legacy Bombardier and the work that you’ve done in the North Country, we’ve also had really strong relationships with New York State. This, again, in our industry, we’re beneficiaries of public money and we deliver a public service to the transit agencies and to the riders. The way that we work with elected officials and other stakeholders, to help them understand the impact that we have on job creation, the impact that we have on innovation and driving new technology, the fact that we’re lifeblood of communities across New York, that we have the ability to help strengthen and grow companies in our supplier base, the fact that we have the ability to help them meet some of their policy objectives around MWBE, DBE, veteran owned businesses. There’s so much that we do. It might sound a little corny, I like to say sometimes, I mean, we work in a noble industry. By us winning contracts, by us fulfilling contracts, a lot of good comes out of it. There’s a story to tell there. I’m delighted to be able to tell that story with you up in Plattsburgh and the North Country. And yes, I will be there very soon, and appreciate the invitation.

Steve Melito: Fantastic. You have been listening to New York State Manufacturing Now, the podcast that’s powered by FuzeHub, and we have been here with Joel Wood from NAmTrans and Scott Sherin from Alstom. Joel and Scott, thank you again. This has been a fantastic episode, a lot of great information shared. And I hope everyone who’s out there has enjoyed listening to it as much as I have. Before we go, are you a New York State manufacturer? How about an inventor or an entrepreneur? Do you need business or technical assistance? If you’ve answered yes to any of those questions, you really need to know more about FuzeHub. We are the statewide manufacturing extension partnership center, and we can help you out. So, if you’re looking for some assistance, it’s easy as going to www. fuzehub. com. Once you’re there, look for the request a consultation button. It’s right on the homepage. There’s a form you can complete. And then, a member of the manufacturing solutions program will get in touch with you soon to find out what it is that you need. So again, on behalf of New York State Manufacturing Now, I’m your host, Steve Melito, signing off.

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