Fairgoers take a look on a displayed train by German train manufacturer Vossloh during the opening day of the Innotrans International Trade Fair for Transport and Mobility in Berlin Sept 23, 2014. (TOBIAS SCHWARZ / AFP)

BERLIN - The world's largest manufacturer of rolling stock, China Railway Rolling Stock Corporation (CRRC), was granted approval to acquire German Vossloh Locomotives, Germany's competition authority, the Bundeskartellamt, announced on Monday.

Vossloh Locomotives employs around 500 people and achieved a turnover of more than 100 million euros in 2019

"By acquiring Vossloh, CRRC takes over a key manufacturer of shunters in Europe," said Andreas Mundt, president of the Bundeskartellamt.

As market leader for diesel-powered shunters in Europe, Vossloh Locomotives employs around 500 people and achieved a turnover of more than 100 million euros in 2019.

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For its assessment of the merger, Germany's Bundeskartellamt had considered "state subsidies, the availability of technical and financial means and strategic advantages from other shareholdings."

Bundeskartellamt argued that Vossloh Locomotives' competitiveness had "suffered considerably" over the last few years and new competitors that offered innovative traction technologies had entered the market.

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The market was changing towards hybrid traction systems and dual mode trains which could be powered by both diesel engine and electricity from overhead wires but Vossloh Locomotives would currently not offer such trains and the German company had lost "competitive strength" as a result.

"Based on our investigations, we were able to exclude a considerable impairment of competition on the European shunter market as a result of the merge," Mundt concluded.