Wabtec

Founded in 1999 through the merger of Westinghouse Air Brake Company and MotivePower, Wabtec traces its roots back to George Westinghouse’s air brake business founded in 1869.  Headquartered in Pittsburgh, Pennsylvania, Wabtec is a global provider of equipment, systems, digital solutions, and services for rail and transit customers.

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Wabtec supports the full rail lifecycle, from new-build and modernization to aftermarket parts and long-term service. Its offerings span freight locomotives and components, braking and onboard systems, signaling and train control, and software that helps operators improve reliability and asset utilization.  The company also serves adjacent industrial markets such as mining, marine, and stationary applications where rail-derived technology and service capabilities transfer well.

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In 2019, Wabtec expanded its locomotive, services, and digital footprint through the completed merger with GE Transportation.  Today, the business is organized around Freight and Transit segments, reflecting its exposure to both North American freight rail and global passenger transit investments.  Across both segments, Wabtec frames its strategy around safer operations, higher network efficiency, and lower emissions through technology, automation, and fleet upgrades.

Wabtec earns revenue through two reporting segments, with a mix of original equipment sales and recurring aftermarket and service work tied to a large installed base. In 2024, Freight generated about 72% of total net sales and Transit about 28%. Aftermarket is central to the model, representing about 61% of Freight sales and about 55% of Transit sales.

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1. Freight (Equipment, Components, Services, Digital Intelligence)
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   The Freight segment builds new and modernized locomotives, sells components for freight cars, and provides parts, overhauls, rebuilds, and fleet modernizations. It also sells rail control and infrastructure products, including Positive Train Control equipment and signaling design and engineering services, plus software and analytics used for network optimization and asset performance management.
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   A key economic driver is Wabtec’s installed base of nearly 24,000 locomotives, which supports recurring parts and service demand across cycles.
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2. Transit (Equipment and Aftermarket Services)
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   The Transit segment supplies and services components for passenger rail and bus fleets, including systems used in regional rail, high-speed rail, metros, light rail, and buses, with a meaningful recurring aftermarket stream from the global installed base.
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Market position

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Wabtec’s scale in North American freight locomotives and its service-heavy revenue base anchor its competitive position. In freight locomotives, Progress Rail (EMD) is a direct rival in the US long-haul diesel market.  In braking, onboard systems, and rail subsystems, competition includes Knorr-Bremse and other large rail suppliers.  In rail control, signaling, and digital rail solutions, the competitive set often includes Siemens Mobility, Alstom, Hitachi Rail, and Thales, with ongoing consolidation in North America signaling.

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Operationally, Wabtec’s model is built around lifecycle coverage, meaning new equipment sales feed a long tail of service, parts, and software revenues. Recent results also show momentum in higher-value offerings, with Freight digital growth in 2025 supported by acquisitions in inspection and monitoring technologies.

China remains one of the world’s largest rail investment markets. The country ended 2024 with about 48,000 km of operating high-speed rail and targets about 60,000 km by 2030, alongside a broader push to expand total railway mileage.

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Wabtec participates in China mainly through onboard systems, components, and lifecycle support rather than prime rolling stock builds. Its local footprint includes wholly owned entities in Beijing, Shanghai, Tianjin, Suzhou, and other locations, plus multiple joint ventures that link Wabtec technology with Chinese partners, including CRRC related ventures in diesel engines and braking.  Recent work in Greater China includes fleet modernization activity with MTR in Hong Kong, showing demand for upgrades and service life extensions in dense urban networks.

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Competition is led by CRRC’s vertically integrated domestic supply base, so Wabtec’s edge comes from safety-critical subsystems, reliability engineering, and long-term aftermarket support delivered through localized operations.

Wabtec’s growth outlook is anchored in three levers: a large installed base that drives recurring aftermarket demand, rising rail investment cycles in transit and freight, and a shift toward digital and lower-emission fleets. As of September 30, 2025, Wabtec reported a multi-year backlog of $25.6 billion, supporting multi-year revenue visibility.

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Key growth drivers include:
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1. Large locomotive and service wins that pull through long-term parts and maintenance
   In September 2025, Kazakhstan awarded Wabtec a $4.2 billion locomotive order described as the largest in company history, paired with long-term service support.  Large fleet contracts tend to expand the installed base and raise the share of higher-margin service work over time.
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2. Transit renewal and infrastructure programs
   In January 2026, Wabtec secured a $386 million follow-on order from New York’s MTA for additional R255 hybrid battery-diesel work locomotives, tied to the agency’s capital plan for maintenance and infrastructure upgrades.
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3. Digital and inspection technologies that increase recurring revenue mix
   Wabtec completed the acquisition of Evident’s Inspection Technologies business on July 1, 2025, strengthening its Digital Intelligence offering across rail and industrial markets. Wabtec stated that the deal doubles its total addressable market from about $8 billion to $16 billion, with a focus on diagnostics, automation, and predictive maintenance workflows.
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4. Lower-emission propulsion and fleet modernization
   Wabtec continues to develop battery-electric solutions such as FLXdrive for heavy-haul applications and is advancing hydrogen dual-fuel engine work, including a hydrogen “first fire” milestone in May 2024.  These programs support customer decarbonization roadmaps and create upgrade demand for controls, thermal management, and energy systems.
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Challenges to watch:

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• Order timing and project execution risk on large multi-year programs, including locomotive deliveries and modernization schedules.
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• Tariffs and working-capital swings that pressure cash conversion in certain periods.
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• Competitive intensity across locomotives, subsystems, and signaling, especially where buyers prioritize price and localization.
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Management guidance and backlog trends in 2025 point to continued earnings and cash flow momentum, with 2025 adjusted EPS guidance raised to $8.85 to $9.05 alongside revenue guidance of $10.925 billion to $11.225 billion.