Global Railway Industries Ltd. signs $101.5 million contract



    5-Year Program to Remanufacture 53 VIA Rail Locomotives

    Stock Symbol: GBI
    Listing: Toronto Stock Exchange
    Outstanding Shares: 15.0 Million
    Web Site: www.globalrailway.com

    LACHINE, QC, Dec. 11 /CNW/ - Global Railway Industries Ltd. (GBI:TSX):
Global Railway Industries Ltd., www.globalrailway.com, ("Global" or the
"Company"), an integrated rail products and services provider, announced that
the Company's wholly owned subsidiary CAD Railway Industries Ltd. ("CAD") was
awarded a 5-year $101.5 million contract excluding cost escalation provisions,
to remanufacture a fleet of 53 VIA Rail Canada ("VIA") locomotives.
    "In October 2007, the Federal Government announced approximately $700
million in capital programs for VIA's future; including programs to
remanufacture their locomotives and intercity passenger railcars," said Terry
McManaman Chief Executive Officer of Global. "We are delighted to be selected
by VIA as the locomotive remanufacturer for one of the largest passenger rail
infrastructure investment programs in recent Canadian history. This contract
award positions Global as the largest re-manufacturer of locomotives in Canada
and as a major competitor in locomotive remanufacturing in North America."
    This program is one of the first to be announced following a significant
capital investment from the federal government. "We are extremely pleased to
announce that CAD Railway Industries Ltd. is our first partner following the
Government's investment," explained Paul Côté, President and CEO of VIA Rail
Canada Inc. "By rebuilding 70% of our fleet of locomotives, CAD will help us
reach our goals of increasing reliability while decreasing maintenance costs.
It is one of the many steps we are undertaking to modernize our fleet while
ensuring all locomotives are in compliance with safety, environmental and
other regulations all as a means to providing our customers with the best
travel experience."
    Beginning in 2008, CAD will begin the remanufacturing program for VIA's
53 F40 locomotives. The VIA fleet renewal program will see the full
remanufacturing of their F40 locomotives. Included in the remanufacture are
several technological upgrades. The remanufactured VIA locomotives will
improve service reliability and fuel efficiency of these twenty year old
locomotives. The remanufacturing program for all 53 VIA locomotives is
expected to be completed by the end of 2012.
    CAD will embark on an infrastructure expansion program as a result of
this contract award. "Detailed plans are already in place to invest capital
into upgrading our engine remanufacturing department and significantly add to
CAD's workforce," said Bill Sturtz, Chief Operating Officer of Global. "As a
result, CAD will be fully equipped for all future locomotive and engine
remanufacturing program opportunities."
    Sturtz continues, "The synergies of locomotive and engine remanufacturing
programs extend to Global's subsidiaries, Bach-Simpson, a supplier of
locomotive instrumentation, and Prime Steel, a fabricator of steel components
for the rail industry."
    "A CAD remanufactured F40 prototype unit has been successfully running in
revenue service for VIA for approximately one year and has demonstrated the
as-new reliability and fuel efficiency that a CAD remanufactured locomotive
can deliver," said Fausto Levy, President of CAD. "Delivery of the first 9
remanufactured VIA locomotives will occur in 2009. The delivery run rate of
remanufactured VIA locomotives will increase in each subsequent year of the
program until completed in 2012."
    "The size and length of the VIA contract will have a major impact on
Global's future growth," said Brian McMullan, Chief Financial Officer of
Global. "CAD will invest an estimated $1.0 million in upgrading its production
facilities. In 2008, initial revenues will be offset with expenditures
relating to non-recurring startup and development costs. In 2009, CAD will
begin to generate significant increases in revenues and earnings from the VIA
contract."
    "The business activity generated from this contract, which is denominated
in Canadian dollar currency, provides further balance to Global's overall
operations between Canada and the United States," said McMullan.
    "North American railroads and commuter systems today are making
significant capital investments in the remanufacturing of their locomotive,
freight car and passenger railcar fleets to meet volume demands, fuel
efficiency targets and new environmental and emission standards. Once the F40
locomotive remanufacturing program is complete, VIA Rail will have one of the
most reliable and fuel efficient fleets of diesel locomotives of any passenger
rail operator in North America," said McManaman.

    Based in Lachine (Montreal) Quebec, CAD Railway Industries Ltd. is an
international re-manufacturer of locomotives, rail cars, power generation
units and components. For more information on CAD visit www.cadrail.ca.

    About Global Railway Industries: Global Railway Industries Ltd. is an
integrated rail product and service provider for the locomotive, rail car and
track & signal railway markets in North America. Global Railway is a public
company whose shares are listed for trading on the Toronto Stock Exchange
(TSX) under the symbol "GBI". The Company has a total of 15.0 million shares
outstanding. For more information: visit www.globalrailway.com or
www.investorfile.com.

    THIS NEWS RELEASE MAY CONTAIN FORWARD LOOKING INFORMATION. ACTUAL FUTURE
RESULTS MAY DIFFER MATERIALLY FROM THOSE CONTEMPLATED. THE RISKS,
UNCERTAINTIES AND OTHER FACTORS, BOTH KNOWN AND UNKNOWN, THAT COULD INFLUENCE
ACTUAL RESULTS MAY BE SUBSTANTIAL AND INCLUDE THOSE DESCRIBED IN DOCUMENTS
FILED WITH REGULATORY AUTHORITIES, SUCH AS THE COMPANY'S MOST RECENTLY FILED
ANNUAL REPORT AND ANNUAL INFORMATION FORM. ACCORDINGLY, NO ASSURANCES CAN BE
GIVEN THAT ANY OF THE EVENTS ANTICIPATED BY THE FORWARD-LOOKING STATEMENTS
WILL TRANSPIRE OR OCCUR, OR IF ANY OF THEM DO SO, WHAT BENEFITS THE COMPANY
WILL DERIVE THEREFROM.

    %SEDAR: 00010076EF




For further information:

For further information: Company Contact: Terry McManaman, Chairman,
President & CEO, Tel: (585) 419-9720, E-mail: tmcmanaman@globalrailway.com,
Web: www.globalrailway.com; Investor Relations: Gerry Wimmer,
INVESTORFILE.com, Tel: (416) 360-8895, Toll Free: 1-888-894-8222, E-mail:
gwimmer@investorfile.com, Web: www.investorfile.com

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