Bombardier Selected for an Automated Rapid Transit Project in South Korea.

Business Editors

MONTREAL--(BUSINESS WIRE)--Aug. 21, 2000

Bombardier Transportation (TSE:BBD.A.)(TSE:BBD.B.) is a member of a consortium that has been selected by the Government of the Republic of Korea to negotiate the terms of a concession contract for the turnkey design, construction and operations of a rapid transit system linking the rapidly growing City of Kimhae, with Pusan, the second largest city in South Korea.

Bombardier will be responsible for the core electrical and mechanical systems, including the initial 46 vehicles, for the fully automated line that also will serve as a connector to the international airport in Kimhae.

The Pusan-Kimhae transit system will use Bombardier's driverless Advanced Rapid Transit (ART) technology, well proven in Vancouver and Toronto, Canada; Kuala Lumpur, Malaysia; Detroit, United States; and soon to be operational at the JFK International Airport in New York City. Intended to service 18 stations over 24 kilometres of double-track guideway, the Pusan-Kimhae line is the first rapid transit project in South Korea to be built under a public-private partnership approach. The project is expected to take four years to build and is estimated to cost approximately CDN$1.6 billion (US$1.1 billion). Bombardier's share of the contract is valued at approximately CDN$438 million (US$300 million).

Bombardier and Kumho Industrial Co. Ltd., one of the major business groups in South Korea, are the lead members of the consortium, and will cooperate with its consortium partners to establish a jointly owned company to operate and maintain the rapid transit system for a period of 30 years. The local and international partners, comprising Lotte Engineering and Construction Co. Ltd., Iljin Electric Co. Ltd., and Econ International Ltd., will assume responsibility for civil works and non-core electrical and mechanical systems.

Commenting on the Government's selection of the consortium, Bombardier Transportation President and Chief Operating Officer Jean-Yves Leblanc said "We welcome this outstanding opportunity to team up with leading Korean and global companies to deliver this world-class transit system." He then noted "We are proud that our technology will be part of the transportation solution for the Cities of Kimhae and Pusan and look forward to working with local suppliers and contractors." Bombardier intends to work with its local partners to manufacture and supply electrical and mechanical components for the rapid transit system.

Bombardier Transportation's Transit Systems, based in Kingston, Canada, will be responsible for overall system design, vehicles, systems engineering and integration, supply of train control, communications and power supply systems, automatic fare collection, trackwork, and testing and commissioning. Bombardier will also provide operations and maintenance start-up assistance and training for Korean personnel.

Bombardier Transportation, a world leader in the manufacturing of passenger rail cars, offers a full range of urban, suburban and intercity vehicles as well as complete rail transit systems worldwide. It also manufactures freight cars and provides operations and maintenance services.

Bombardier Inc., a diversified manufacturing and service company, is a world leading manufacturer of business jets, regional aircraft, rail transportation equipment and motorised recreational products. It is also a provider of financial services and asset management. The Corporation employs 56,000 people in 12 countries in North America, Europe and Asia, and more than 90 % of its revenues are generated outside Canada. Bombardier's revenues for its fiscal year ended Jan. 31, 2000 totalled $13.6 billion.