Transnet Engineering targeting 40% in third-party orders by 2021

The engineering unit of State-owned freight logistics group Transnet has set a target of securing 40% of its revenue from third-party orders by 2021, which would represent a material increase from current levels of around 12%.

The bulk of Transnet Engineering’s R10-billion in yearly revenue is currently derived from Transnet Freight Rail (TFR). However, newly appointed chief advanced manufacturing officer Thamsanqa Jiyane tells Engineering News that the unit has been restructured to improve its prospects of securing non-TFR work.

It has set up four customer-facing business units – locomotives, coaches, wagons and maintenance – and has consolidated its internally focused wheels, rotating machine and foundry businesses to support its facilities in Cape Town, Pretoria, Germiston, Bloemfontein and Durban.

The strategy is designed to enable Transnet Engineering to transition from being an in-house engineering service provider to an original equipment manufacturer (OEM) of locomotives, passenger coaches and wagons, as well as a leading African provider of maintenance, repair and overhaul (MRO) services.

The company has already invested approximately R300-million in the research and development (R&D) of its so-called Trans-Africa Locomotive, which will be officially unveiled by the end of August 2017.

The product, which is designed for operation in shunting yards and branch lines, has been designed “from scratch” by the utility’s R&D unit, which is housed at the Council for Scientific and Industrial Research, in Pretoria. Transnet Engineering employs some 500 engineers, across disciplines, who are working on the light diesel locomotive, as well as other products and solutions.

Jiyane reports that it intends partnering with other established OEMs on the development of a heavy-haul offering, owing primarily to the large R&D expense associated with such locomotives, which runs into billions of dollars.

The intention is to begin static testing of the Trans-Africa Locomotive in the coming three months and to start marketing the solution in parallel with the dynamic-testing phase, which is expected to continue for up to nine months.

Designed to operate at a maximum speed of 100 km/h, the locomotive will be marketed to mining companies, as well as other African utilities, with one mining company having already expressed an interest in buying up to 12 of these locomotives.