Phase 1 of the Construction Consists of 2.16 Miles of Dual Guideway That Will Connect The

Press release

Alcatel to provide Radio Communications-Based Train Control for the new Washington Dulles Airport APM

Paris, July 7, 2004 – Alcatel (Paris: CGEP.PA and NYSE: ALA) announced today that it has executed an agreement with Mitsubishi Heavy Industries America (MHI) to provide the automatic train control solution for the new radio-based, driverless, automated people mover (APM) for Washington’s Dulles International Airport. This project is part of the Metropolitan Washington Airport Authority’s ambitious plan to expand the Capital city’s facilities in order to better serve the travelling public.

Phase 1 of the construction consists of 2.16 miles of dual guideway that will connect the main terminal with concourses A/B and C/D, through a secure, underground, rubber-tired APM system. Revenue service of the Dulles Phase 1 line is scheduled for 2009.

Alcatel will deliver its proven SelTrac® S40 communications-based train control (CBTC) solution. The system provides automatic train protection, operation and supervision, central control, and employs spread-spectrum radio technology for data communication between trains and wayside, which results in a simpler infrastructure. The solution for Dulles is similar to the one Alcatel is implementing for the Las Vegas Monorail and for the MTR Penny’s Bay Link in Hong Kong.

“The Alcatel SelTrac train control system was selected for its ability to scale and to expand to handle the increasing fleet and train size required for full line capacity. The solution is proven to provide the 99.99% automatic train control system availability, flexible operation, and low operating cost we were looking for," said Takashi Uneda, General Manager, Mitsubishi Heavy Industries America.

John Brohm, President of Alcatel transport automation activities in the U.S. said: “The Dulles project is a significant win for us as the system will be the fifth application of our radio CBTC solution. This growing acceptance of our high performance train control solution is the best endorsement of the value and proven nature of Alcatel’s SelTrac technology. We are very pleased to be working with MHI, and pleased to have this opportunity to expand the application of our industry-leading train control technology.”

SelTrac is recognised as the leading signaling and train control solution for reliable and high performance urban rail transit, including optimized throughput and driverless operation capabilities. Alcatel’s SelTrac CBTC systems are in commercial operation or are being implemented on more than 500 kilometres of urban rail transit lines worldwide including Toronto, Vancouver, San Francisco, Tampa, New York, London, Hong Kong, Paris, Kuala Lumpur, Wuhan and Guangzhou.

About Alcatel Transport Automation Solutions

To meet the challenge of increased mobility, Alcatel offers a host of advanced urban rail transit solutions to move people safely through the network in a confortable, reliable and cost-effective way. Drawing on broad international experience in all aspects of transport automation, Alcatel is a leading worldwide supplier of train control, signaling, train routing, control center and integrated rail communications technologies. For urban line operators, Alcatel's offering includes proven SelTrac® communications-based train control, NetTrac MT network management, and LockTrac electronic interlocking system solutions. For more information, visit us on the Internet: http://www.alcatel.com/tas

About Alcatel

Alcatel provides communications solutions to telecommunication carriers, Internet service providers and enterprises for delivery of voice, data and video applications to their customers or to their employees. Alcatel leverages its leading position in fixed and mobile broadband networks, applications and services to bring value to its customers in the framework of a broadband world. With sales of EURO 12.5 billion in 2003, Alcatel operates in more than 130 countries. For more information, visit Alcatel on the Internet: http://www.alcatel.com

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Alcatel Investor Relations

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