1.5 Investment Policy
The company has made significant investments in plant and machinery and in buildings, and between 1998-99 more than doubled the total amount invested. So far, very little has been invested that is of direct relevance to the production of gas turbines for marine applications because of the lack of orders.
However, the availability of factory space and some production equipment means that the additional investment in equipment required to be able to make gas turbines for marine applications would not be very great and could be completed quite quickly. As a result, the company does not feel it necessary to make this additional investment until after it receives new orders from marine customers.
1.6 Market Development
Alstom's decision to take full control of ABB Alstom Power is consistent with the Alstom Group's strategy of focusing on major projects. Within Alstom Power the decision to re-enter the marine market is based on perceived market opportunities arising from the development of high speed ferries and the growth in the cruise ship sector. In respect of the latter the company has taken the view that there will be increasing demand for more power on such vessels, both for propulsion and for meeting the needs of passengers. Gas turbines are said to occupy less space than diesel engines, to be lighter and to be cleaner. Alstom Power believes that the resources and reputation of the Alstom Group will enable them to convince customers of their ability to compete seriously in the marketplace.
In respect of Japan specifically, Alstom Power has been in conversation with the Nissho-Iwai trading house but any plans to explore the Japanese market have been delayed by Alstom Power's restructuring.
