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Document and Entity Information - USD ($)	12 Months Ended
Document and Entity Information - USD ($)	Dec. 31, 2010	Feb. 22, 2011	Jun. 30, 2010
Document and Entity Information
Document Type	10-K
Amendment Flag	false
Document Period End Date	Dec. 31, 2010
Document Fiscal Year Focus	2010
Document Fiscal Period Focus	FY
Trading Symbol	WAB
Entity Registrant Name	WESTINGHOUSE AIR BRAKE TECHNOLOGIES CORP
Entity Central Index Key	0000943452
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Well-known Seasoned Issuer	Yes
Entity Public Float			$ 1,800,000,000
Entity Common Stock, Shares Outstanding		47,960,461

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2010	Dec. 31, 2009
Current Assets
Cash and cash equivalents	$ 236,941	$ 188,659
Accounts receivable	258,149	208,260
Inventories	253,491	239,333
Deferred income taxes	39,573	40,533
Other	13,799	12,724
Total current assets	801,953	689,509
Property, plant and equipment	478,023	451,996
Accumulated depreciation	(271,798)	(250,289)
Property, plant and equipment, net	206,225	201,707
Other Assets
Goodwill	545,832	482,978
Other intangibles, net	216,913	187,630
Deferred income taxes	3,346	4,964
Other noncurrent assets	28,812	19,047
Total other assets	794,903	694,619
Total Assets	1,803,081	1,585,835
Current Liabilities
Accounts payable	170,504	119,895
Customer deposits	23,810	44,251
Accrued compensation	39,870	30,423
Accrued warranty	20,510	20,025
Current portion of long-term debt	40,068	32,741
Commitments and contingencies	593	373
Other accrued liabilities	53,019	57,640
Total current liabilities	348,374	305,348
Long-term debt	382,007	359,039
Accrued postretirement and pension benefits	60,508	64,078
Deferred income taxes	76,505	52,156
Commitments and contingencies	900	1,110
Accrued warranty	15,003	9,182
Other long -term liabilities	16,397	16,009
Total liabilities	899,694	806,922
Shareholders' Equity
Preferred stock, 1,000,000 shares authorized, no shares issued
Common stock, $.01 par value; 100,000,000 shares authorized: 66,174,767 shares issued and 47,954,085 and 47,688,695 outstanding at December 31, 2010 and 2009, respectively	662	662
Additional paid-in capital	339,861	329,707
Treasury stock, at cost, 18,220,682 and 18,486,072 shares, at December 31, 2010 and 2009, respectively	(290,081)	(289,137)
Retained earnings	887,406	766,221
Accumulated other comprehensive loss	(38,077)	(30,546)
Total Westinghouse Air Brake Technologies Corporation shareholders' equity	899,771	776,907
Non-controlling interest	3,616	2,006
Total shareholders' equity	903,387	778,913
Total Liabilities and Shareholders' Equity	$ 1,803,081	$ 1,585,835

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2010	Dec. 31, 2009	Dec. 31, 2008
Consolidated Statements of Operations
Net sales	$ 1,507,012	$ 1,401,616	$ 1,574,749
Cost of sales	(1,057,934)	(1,008,290)	(1,147,563)
Gross profit	449,078	393,326	427,186
Selling, general and administrative expenses	(195,892)	(160,998)	(170,597)
Engineering expenses	(40,203)	(42,447)	(38,981)
Amortization expense	(10,173)	(9,849)	(5,092)
Total operating expenses	(246,268)	(213,294)	(214,670)
Income from operations	202,810	180,032	212,516
Other income and expenses
Interest expense, net	(15,923)	(16,674)	(8,508)
Other (expense) income, net	(60)	1	292
Income from continuing operations before income taxes	186,827	163,359	204,300
Income tax expense	(63,728)	(48,304)	(73,746)
Income from continuing operations	123,099	115,055	130,554
Loss from discontinued operations (net of tax)			(3)
Net income attributable to Wabtec shareholders	$ 123,099	$ 115,055	$ 130,551
Basic
Net income attributable to Wabtec shareholders	$ 2.57	$ 2.41	$ 2.69
Diluted
Net income attributable to Wabtec shareholders	$ 2.56	$ 2.39	$ 2.66
Weighted average shares outstanding
Basic	47,597	47,499	48,232
Diluted	48,005	47,977	48,847

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2010	Dec. 31, 2009	Dec. 31, 2008
Operating Activities
Net income attributable to Wabtec shareholders	$ 123,099	$ 115,055	$ 130,551
Adjustments to reconcile net income to cash provided by operations:
Depreciation and amortization	38,586	35,519	29,826
Stock-based compensation expense	11,765	3,620	10,475
Deferred income taxes	16,248	7,391	4,870
Loss (gain) on disposal of property, plant and equipment	777	(2,913)	2,647
Excess income tax benefits from exercise of stock options	(2,570)	(1,906)	(1,922)
Discontinued operations			(38)
Changes in operating assets and liabilities, net of acquisitions
Accounts receivable	(34,255)	80,541	(20,841)
Inventories	(1,650)	33,360	(42,726)
Accounts payable	44,294	(48,238)	14,303
Accrued income taxes	(5,811)	841	(511)
Accrued liabilities and customer deposits	(10,181)	(56,203)	31,512
Other assets and liabilities	(4,166)	(4,767)	(2,346)
Net cash provided by operating activities	176,136	162,300	155,800
Investing Activities
Purchase of property, plant and equipment	(20,843)	(18,288)	(19,715)
Proceeds from disposal of property, plant and equipment	418	4,091	447
Acquisitions of businesses, net of cash acquired	(138,198)	(96,283)	(398,132)
Acquisition purchase price adjustments	2,368	(4,741)	(41)
Net cash used for investing activities	(156,255)	(115,221)	(417,441)
Financing Activities
Proceeds from debt	248,400	197,500	236,000
Payments of debt	(218,083)	(193,324)	(385)
Debt financing costs			(2,858)
Stock repurchase	(8,381)	(19,654)	(45,796)
Proceeds from exercise of stock options and other benefit plans	3,256	2,532	2,768
Excess income tax benefits from exercise of stock options	2,570	1,906	1,922
Cash dividends ($0.04 per share for the year ended December 31, 2010, 2009 and 2008)	(1,914)	(1,917)	(1,940)
Net cash provided by (used for) financing activities	25,848	(12,957)	189,711
Effect of changes in currency exchange rates	2,553	12,732	(20,954)
Increase/(decrease) in cash	48,282	46,854	(92,884)
Cash, beginning of year	188,659	141,805	234,689
Cash, end of year	$ 236,941	$ 188,659	$ 141,805

Consolidated Statements of Shareholders' Equity - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2010	Dec. 31, 2009	Dec. 31, 2008
Statement [Line Items]
Balance, value	$ 776,907	$ 645,371	$ 617,268
Adjustment to Beginning Retained Earnings due to adoption of FAS 158			(66)
Cash dividends	(1,914)	(1,917)	(1,940)
Proceeds from treasury stock issued from the exercise of stock options and other benefit plans, net of tax, value	5,826	4,438	4,690
Stock-based Compensation	11,765	3,620	10,475
Net income	123,099	115,055	130,551
Translation adjustment	(2,633)	32,040	(59,722)
Unrealized gains (loss) on foreign exchange contracts, net of tax	(52)	(96)	26
Unrealized (loss) on interest rate swap contracts, net of tax	(1,495)	(38)
Change in pension and post retirement benefit plans, net of tax	(3,351)	(1,912)	(10,115)
Stock Repurchase, value	(8,381)	(19,654)	(45,796)
Balance, value	899,771	776,907	645,371
Comprehensive Income (Loss)
Statement [Line Items]
Net income	123,099	115,055	130,551
Translation adjustment	(2,633)	32,040	(59,722)
Unrealized gains (loss) on foreign exchange contracts, net of tax	(52)	(96)	26
Unrealized (loss) on interest rate swap contracts, net of tax	(1,495)	(38)
Change in pension and post retirement benefit plans, net of tax	(3,351)	(1,912)	(10,115)
Total comprehensive income	115,568	145,049	60,740
Common Stock
Statement [Line Items]
Balance, value	$ 662	$ 662	$ 662
Balance, shares	66,174,767	66,174,767	66,174,767
Balance, value	$ 662	$ 662	$ 662
Balance, shares	66,174,767	66,174,767	66,174,767
Additional Paid-in Capital
Statement [Line Items]
Balance, value	$ 329,707	$ 328,587	$ 320,928
Proceeds from treasury stock issued from the exercise of stock options and other benefit plans, net of tax, value	(1,611)	(2,500)	(2,816)
Stock-based Compensation	11,765	3,620	10,475
Balance, value	339,861	329,707	328,587
Treasury Stock
Statement [Line Items]
Balance, value	$ (289,137)	$ (276,421)	$ (238,131)
Balance, shares	(18,486,072)	(18,267,410)	(17,476,423)
Proceeds from treasury stock issued from the exercise of stock options and other benefit plans, net of tax, value	$ 7,437	$ 6,938	$ 7,506
Proceeds from treasury stock issued from the exercise of stock options and other benefit plans, net of tax, shares	471,950	451,038	526,913
Stock Repurchase, shares	(206,560)	(669,700)	(1,317,900)
Stock Repurchase, value	$ (8,381)	$ (19,654)	$ (45,796)
Balance, value	$ (290,081)	$ (289,137)	$ (276,421)
Balance, shares	(18,220,682)	(18,486,072)	(18,267,410)
Retained Earnings
Statement [Line Items]
Balance, value	$ 766,221	$ 653,083	$ 524,538
Adjustment to Beginning Retained Earnings due to adoption of FAS 158			(66)
Cash dividends	(1,914)	(1,917)	(1,940)
Net income	123,099	115,055	130,551
Balance, value	887,406	766,221	653,083
Accumulated Other Comprehensive Income (Loss)
Statement [Line Items]
Balance, value	(30,546)	(60,540)	9,271
Translation adjustment	(2,633)	32,040	(59,722)
Unrealized gains (loss) on foreign exchange contracts, net of tax	(52)	(96)	26
Unrealized (loss) on interest rate swap contracts, net of tax	(1,495)	(38)
Change in pension and post retirement benefit plans, net of tax	(3,351)	(1,912)	(10,115)
Balance, value	$ (38,077)	$ (30,546)	$ (60,540)

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2010

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation The consolidated financial statements include the accounts of the Company and its majority owned subsidiaries. Such statements have been prepared in accordance with generally accepted accounting principles. Sales between subsidiaries are billed at prices consistent with sales to third parties and are eliminated in consolidation.

Cash Equivalents Cash equivalents are highly liquid investments purchased with an original maturity of three months or less.

Allowance for Doubtful Accounts The allowance for doubtful accounts receivable reflects our best estimate of probable losses inherent in our receivable portfolio determined on the basis of historical experience, specific allowances for known troubled accounts and other currently available evidence. The allowance for doubtful accounts was $7.5 million and $7.3 million as of December 31, 2010 and 2009, respectively.

Inventories Inventories are stated at the lower of cost or market. Cost is determined under the first-in, first-out (FIFO) method. Inventory costs include material, labor and overhead.

Property, Plant and Equipment Property, plant and equipment additions are stated at cost. Expenditures for renewals and improvements are capitalized. Expenditures for ordinary maintenance and repairs are expensed as incurred. The Company provides for book depreciation principally on the straight-line method. Accelerated depreciation methods are utilized for income tax purposes.

Leasing Arrangements The Company conducts a portion of its operations from leased facilities and finances certain equipment purchases through lease agreements. In those cases in which the lease term approximates the useful life of the leased asset or the lease meets certain other prerequisites, the leasing arrangement is classified as a capital lease. The remaining arrangements are treated as operating leases.

Intangible Assets Goodwill and other intangible assets with indefinite lives are not amortized. Other intangibles (with definite lives) are amortized on a straight-line basis over their estimated economic lives. Amortizable intangible assets are reviewed for impairment when indicators of impairment are present. The Company tests goodwill and indefinite-lived intangible assets for impairment at least annually. The Company performs its annual impairment test during the fourth quarter after the annual forecasting process is completed, and is reviewed for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Periodically, Management of the Company assesses whether or not an indicator of impairment is present that would necessitate a goodwill impairment analysis be performed. t;/font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"The goodwill impairment analysis is performed by comparing the carrying amount of the reporting unit to its estimated fair value and to the extent that the carrying value of the reporting unit exceeds its estimated fair value, the reporting unit's carrying value of goodwill is compared to the implied fair value of goodwill. To the extent that the carrying value of goodwill exceeds the implied fair value of goodwill, impairment exists and must be recognized. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"The Company reviews goodwill for impairment at the reporting unit level. The Company prepares its goodwill impairment analysis by comparing the estimated fair value of each reporting unit, using an income approach (a discounted cash flow model) as well as a market approach, with its carrying value. The income approach and the market approach are equally weighted in arriving at fair value, which the Company has applied consistently. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"The discounted cash flow model requires several assumptions including future sales growth, EBIT (earnings before interest and taxes) margins and capital expenditures for the reporting units. The discounted cash flow model also requires the use of a discount rate and a terminal revenue growth rate (the revenue growth rate for the period beyond the three years forecasted by the reporting units), as well as projections of future operating margins. During the fourth quarter of 2010, the Company used a discount rate for each of its reporting units ranging from 11% to 13% and a terminal revenue growth rate of 1% to 3%. The difference in the discount rates is based on the underlying markets and risks associated with each of the Company's reporting units. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"The market approach requires several assumptions including EBITDA (earnings before interest, taxes, depreciation and amortization) multiples for comparable companies that operate in the same markets as the Company's reporting units. During the fourth quarter of 2010, the Company used EBITDA multiples for its reporting units ranging from 6.0 to 12.0. The difference in the EBITDA multiples is due to the underlying markets associated with each of the Company's reporting units. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"The fair value of each reporting units exceeded the carrying value of each reporting unit by more than 10% as of the date of the Company's impairment test. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"biWarranty Costs /i/bWarranty costs are accrued based on Management's estimates of repair or upgrade costs per unit and historical experience. Warranty expense was $22.8 million, $20.4 million and $17.1 million for 2010, 2009 and 2008, respectively. Accrued warranty was $35.5 million and $29.2 million at Decembernbsp;31, 2010 and 2009, respectively. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"biIncome Taxes /i/bIncome taxes are accounted for under the liability method. Deferred tax assets and liabilities are determined based on differences between financial reporting and tax basis of assets and liabilities and are measured using the enacted tax rates and laws. The provision for income taxes includes federal, state and foreign income taxes. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"biStock-Based Compensation /i/bThe Company recognizes compensation expense for stock-based compensation based on the grant date fair value. This expense must be recognized ratably over the requisite service period following the date of grant. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"biFinancial Derivatives and Hedging Activities /i/bThe Company has entered into foreign currency forward contracts to reduce the impact of changes in currency exchange rates. Forward contracts are agreements with a counterparty to exchange two distinct currencies at a set exchange rate for delivery on a set date at some point in the future. There is no exchange of funds until the delivery date. At the delivery date the Company can either take delivery of the currency or settle on a net basis. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"At Decembernbsp;31, 2010, the Company had forward contracts for the sale of South African Rand (ZAR) and the purchase of U.S. Dollars (USD). The Company concluded that these foreign currency forward contracts qualify for cash flow hedge accounting which permits the recording of the fair value of the forward contract and corresponding adjustment to other comprehensive income (loss), net of tax, on the balance sheet. As of Decembernbsp;31, 2010, the Company had forward contracts with a notional value of 24.7 million ZAR (or $3.4nbsp;million U.S.) with an average exchange rate of 7.19 ZAR per $1 USD, resulting in the recording of a current liability of $192,000 and a corresponding offset in accumulated other comprehensive income of $122,000, net of tax. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"At Decembernbsp;31, 2009, the Company had forward contracts for the sale of South African Rand (ZAR) and the purchase of U.S. Dollars (USD). The Company concluded that these foreign currency forward contracts qualify for cash flow hedge accounting which permits the recording of the fair value of the forward contract and corresponding adjustment to other comprehensive income (loss), net of tax, on the balance sheet. As of Decembernbsp;31, 2009, the Company had forward contracts with a notional value of 10.1 million ZAR (or $1.2 million U.S.) with an average exchange rate of 8.21 ZAR per $1 USD, resulting in the recording of a current liability of $110,000 and a corresponding offset in accumulated other comprehensive income of $70,000, net of tax. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"To reduce the impact of interest rate changes on a portion of this variable-rate debt, the Company entered into an interest rate swap which effectively converted a portion of the debt from variable to fixed-rate borrowing during the term of the swap contract. The Company is exposed to credit risk in the event of nonperformance by the counterparty. However, since only the cash interest payments are exchanged, exposure is significantly less than the notional amount. The counterparty is a large financial institution with an excellent credit rating and history of performance. The Company currently believes the risk of nonperformance is negligible. The Company concluded that the interest rate swap agreement qualifies for special cash flow hedge accounting which permits the recording of the fair value of the interest rate swap agreement and corresponding adjustment to other comprehensive income (loss), net of tax, on the balance sheet. As of Decembernbsp;31, 2010, the Company had interest rate swap agreements with a notional value of $137.0 million and which effectively changed the Company's interest rate on bank debt at Decembernbsp;31, 2010 from a variable rate to a fixed rate of 2.27%. The interest rate swap agreements mature at various times through December 2012. As of Decembernbsp;31, 2010, the Company recorded a current liability of $2.5 million and a corresponding offset in accumulated other comprehensive loss of $1.5 million, net of tax. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"biForeign Currency Translation /i/bAssets and liabilities of foreign subsidiaries, except for the Company's Mexican operations whose functional currency is the U.S.nbsp;Dollar, are translated at the rate of exchange in effect on the balance sheet date while income and expenses are translated at the average rates of exchange prevailing during the year. Foreign currency gains and losses resulting from transactions, and the translation of financial statements are recorded in the Company's consolidated financial statements based upon the provisions of ASC 830, "Foreign Currency Matters." The effects of currency exchange rate changes on intercompany transactions and balances of a long-term investment nature are accumulated and carried as a component of shareholders' equity. The effects of currency exchange rate changes on intercompany t ransactions that are denominated in a currency other than an entity's functional currency are charged or credited to earnings. Foreign exchange transaction losses recognized in other (expense) income, net were $1.0 million, $1.3 million and $0.4 million for 2010, 2009 and 2008, respectively. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"biNoncontrolling Interests /i/bOn Januarynbsp;1, 2009, the Company adopted the amendment under ASC 810 "Consolidation" related to noncontrolling interests in consolidated financial statements. This amendment establishes accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. The amendment clarifies that a noncontrolling interest should be reported as equity in the consolidated financial statements and requires net income attributable to both the parent and the noncontrolling interest to be disclosed separately on the face of the consolidated statement of income. The presentation and disclosure requirements of the amendment require retrospective application to all prior periods presented. In accordance with ASC 810, the Company classified noncontrolling interest s as equity on our condensed consolidated balance sheets as of Decembernbsp;31, 2010 and 2009. Net income attributable to noncontrolling interests for the years ended Decembernbsp;31, 2010, 2009 and 2008 was not material. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"biOther Comprehensive Income (Loss)/i/b Comprehensive income (loss) is defined as net income and all other non-owner changes in shareholders' equity. The Company's accumulated other comprehensive income consists of foreign currency translation adjustments, foreign currency hedges, foreign exchange contracts, interest rate swaps, and pension and post retirement related adjustments. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"biRevenue Recognition /i/bRevenue is recognized in accordance with ASC 605 "Revenue Recognition." Revenue is recognized when products have been shipped to the respective customers, title has passed and the price for the product has been determined. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"The Company recognizes revenues on long-term contracts based on the percentage of completion method of accounting. The units-of-delivery method or other input-based or output-based measures, as appropriate, are used to measure the progress toward completion of individual contracts. Contract revenues and cost estimates are reviewed and revised quarterly at a minimum and adjustments are reflected in the accounting period as such amounts are determined. Provisions are made currently for estimated losses on uncompleted contracts. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"Certain pre-production costs relating to long-term production and supply contracts have been deferred and will be recognized over the life of the contracts. Deferred pre-production costs were $11.9 million and $12.1 million at Decembernbsp;31, 2010 and 2009, respectively. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"biSignificant Customers and Concentrations of Credit Risk/i/b The Company's trade receivables are from rail and transit industry original equipment manufacturers, Class I railroads, railroad carriers and commercial companies that utilize rail cars in their operations, such as utility and chemical companies. No one customer accounted for more than 10% of the Company's consolidated net sales in 2010, 2009 and 2008. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"biShipping and Handling Fees and Costs/i/b All fees billed to the customer for shipping and handling are classified as a component of net revenues. All costs associated with shipping and handling is classified as a component of cost of sales. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"biResearch and Development /i/bResearch and development costs are charged to expense as incurred. For the years ended Decembernbsp;31, 2010, 2009 and 2008, the Company incurred costs of approximately $40.2 million, $42.4 million and $39.0 million, respectively. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"biEmployees/i/b As of Decembernbsp;31, 2010, approximately 28% of the Company's workforce was covered by collective bargaining agreements. These agreements are generally effective from 2011 through 2013. Agreements expiring in 2011 cover approximately 11% of the Company's workforce. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"biEarnings Per Share/i/b Basic and diluted earnings per common share is computed in accordance with ASC 260 "Earnings Per Share." Unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and included in the computation of earnings per share pursuant to the two-class method included in ASC 260-10-55. (See Note 11 "Earnings Per Share" included herein) /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"biReclassifications/i/b Certain prior year amounts have been reclassified, where necessary, to conform to the current year presentation. /font/p p style="margin-top: 12px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"biUse of Estimates/i/b The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual amounts could differ from the estimates. On an ongoing basis, Management reviews its estimates based on currently available information. Changes in facts and circumstances may result in revised estimates. /font/p /div

Acquisitions and Discontinued Operations

12 Months Ended

Dec. 31, 2010

Acquisitions and Discontinued Operations

Acquisitions and Discontinued Operations

3.	ACQUISITIONS AND DISCONTINUED OPERATIONS

The Company made the following acquisitions operating as a business unit or component of a business unit in the Freight Group:

•

On August 20, 2010, the Company acquired Bach-Simpson Corporation ("Bach-Simpson"), a designer and manufacturer of electronic instrumentation devices for rail and transit markets, for a net purchase price of approximately $12.0 million, resulting in preliminary additional goodwill of $3.4 million, of which $2.6 million will be deductible for tax purposes.

•

On July 28, 2010, the Company acquired G&B Specialties, Inc. ("G&B"), a manufacturer of railroad track and signaling products, for a net purchase price of approximately $31.8 million, net of cash received, resulting in preliminary additional goodwill of $13.0 million, none of which will be deductible for tax purposes.

•

On March 12, 2010, the Company acquired Xorail LLC ("Xorail"), a leading provider of signal engineering and design services. The purchase price was $39.9 million, net of cash received, resulting in preliminary additional goodwill of $29.2 million, none of which will be deductible for tax purposes.

•

On October 1, 2009, the Company acquired Unifin International LP, and its affiliate, Cardinal Pumps and Exchangers, Inc. ("Unifin"), a manufacturer of cooling systems and related equipment for the power generation and transmission industry. The purchase price was $92.9 million, net of cash received, resulting in goodwill of $56.4 million, of which $31.3 million will be deductible for tax purposes.

•

On December 5, 2008, the Company acquired Standard Car Truck Company ("SCT"), a manufacturer and designer of stabilization systems for freight cars, including engineered truck (undercarriage) components such as springs, friction wedges and wear plates. Its Barber^® brand truck design is used throughout the world and holds a leading share of the North American market. The company also manufactures and services locomotives components, including compressors and pumps. The purchase price was $302.6 million, net of cash received, resulting in goodwill of $154.7 million, of which all will be deductible for tax purposes. Included in the purchase price of $302.6 million is $25.0 million related to an escrow deposit, which may be releas ed to the Company for indemnity claims in accordance with the purchase and escrow agreements.

•

On December 5, 2008, the Company acquired a majority of Beijing Wabtec Huaxia Technology Company, Ltd. ("Huaxia") for $5.6 million. Huaxia manufactures friction products including brake shoes, pads and linings for the freight car market in China.

The Company made the following acquisitions operating as a business unit or component of a business unit in the Transit Group:

•

On November 5, 2010, the Company acquired substantially all of the assets of Swiger Coil Systems ("Swiger"), a manufacturer of traction motors and electric coils for the rail and power generation markets for a net purchase price of approximately $43.0 million, resulting in a preliminary additional goodwill of $18.4 million, of which all will be deductible for tax purposes.

•

On June 30, 2008, the Company acquired 100% of the stock of Poli S.p.A. (Poli), a European based manufacturer of rail braking equipment including brake discs for high speed applications, as well as tread brake units and pneumatic brake valves that meet International Union of Railways (UIC) standards. The purchase price was €55.2 million (about $87.0 million USD), net of cash received, resulting in goodwill of $38.9 million, of which none will be deductible for tax purposes. Included in the purchase price is $11.8 million related to an escrow deposit, which may be released to the Company for indemnity claims, environmental claims or allocation of tax liabilities in accordance with the purchase and escrow agreements.

The 2010 acquisitions listed above include escrow deposits of $21.2 million, which may be released to the Company for indemnity and other claims in accordance with the purchase and escrow agreements.

For the Swiger, Bach-Simpson, G&B, Xorail and Unifin acquisitions, the following table summarizes the preliminary estimated fair values of the assets acquired and liabilities assumed at the date of the acquisition:


	Swiger			Bach-Simpson			G&B			Xorail			Unifin
*In thousands*	November 5, 2010			August 20, 2010			July 28, 2010			March 12, 2010			October 1, 2009
Current assets	$	9,650		$	3,818		$	8,330		$	11,147		$	8,770
Property, plant & equipment		2,978			213			5,510			2,905			5,552
Goodwill and other intangible assets		33,137			8,494			28,947			35,074			89,855
Other assets		—			—			43			226			1,135

Total assets acquired		45,765			12,525			42,830			49,352			105,312
Total liabilities assumed		(2,759	)		(532	)		(10,988	)		(9,409	)		(12,387	)

Net assets acquired	$	43,006		$	11,993		$	31,842		$	39,943		$	92,925

Of the preliminary allocation of $14.8 million of acquired intangible assets for Swiger, exclusive of goodwill, $6.2 million was assigned to customer relationships, $5.1 million was assigned to trade names, $2.4 million was assigned to long-term contracts, $560,000 was assigned to non-compete agreements and $510,000 was assigned to customer backlog. The trade names are considered to have an indefinite useful life while the customer relationships' average useful life is 15 years, the long term contracts average useful life is four years and the non-compete agreements average useful life is two years.

Of the preliminary allocation of $5.1 million of acquired intangible assets for Bach-Simpson, exclusive of goodwill, $2.9 million was assigned to customer relationships, $486,000 was assigned to long-term contracts, $914,000 was assigned to trade names and $752,000 was assigned to customer backlog. The trade names are considered to have an indefinite useful life while the customer relationships' average useful life is 15 years and the long term contracts average useful life is two years.

Of the preliminary allocation of $15.9 million of acquired intangible assets for G&B, exclusive of goodwill, $12.3 million was assigned to customer relationships, $2.8 million was assigned to trade names and $850,000 was assigned to customer backlog. The trade names are considered to have an indefinite useful life while the customer relationships' average useful life is 15 years.

Of the preliminary allocation of $5.9 million of acquired intangible assets for Xorail, exclusive of goodwill, $4.3 million was assigned to customer relationships, $426,000 was assigned to intellectual property, $470,000 was assigned to non-compete agreements and $750,000 was assigned to customer backlog. The customer relationships' average useful life is 20 years, the intellectual property's average useful life is six years and the non-compete agreements' average useful life is six years.

Of the allocation of $33.5 million of acquired intangible assets for Unifin, exclusive of goodwill, $14.8 million was assigned to trade names, $16.2 million was assigned to customer relationships, $278,000 was assigned to patents and $2.2 million was assigned to customer backlog. The trade names are considered to have an indefinite useful life while the customer relationships' average useful life is 10 years and patents' average useful life is three years.

On December 31, 2010, the Company acquired Adantech Industria e Comercio de Metal ("Adantech"), a manufacturer of a variety of brake shoes and pads for subway cars, locomotives and freight cars for a net purchase price of approximately $1.9 million, resulting in preliminary additional goodwill of $1.8 million, of which all will be deductible for tax purposes.

On September 15, 2010, the Company formed a joint venture in China to manufacture transformer oil coolers, generator coolers and related products for the power generation market. The Company invested $1.5 million for a 60% interest in Hubei Dengfeng Unifin Electrical Equipment Cooling System Co., Ltd. ("Unifin DF"). On July 22, 2009, the Company acquired certain assets related to the production of rubber products for $3.4 million. On October 27, 2008, the Company acquired certain assets related to the development, sale, service, and maintenance of software programs used in train management systems for $4.5 million. Operating results have been included in the consolidated statement of operations from the acquisition date forward.

On December 31, 2008, the Company invested $2.8 million in Shenyang CNR Wabtec Railway Brake Technology Company, Ltd. ("Shenyang") for a minority interest in a joint venture Company. On September 9, 2010, the Company invested an additional $8.0 million in this joint venture. Shenyang manufactures braking equipment for the freight car market in China.

The following unaudited pro forma financial information presents income statement results as if Unifin, Xorail, G&B, Bach-Simpson, and Swiger had occurred January 1, 2009:


	For the year ended December 31,
*In thousands, except per share*	2010		2009
Net sales	$	1,559,340	$	1,537,429
Gross profit		467,654		446,373
Net income attributable to Wabtec shareholders		128,275		133,943
Diluted earnings per share
As reported	$	2.56	$	2.39
Pro forma	$	2.66	$	2.79

Long-Term Debt

12 Months Ended

Dec. 31, 2010

Long-Term Debt

Long-Term Debt

8.	LONG-TERM DEBT

Long-term debt consisted of the following:


	December 31,
*In thousands*	2010		2009
6.875% senior notes, due 2013	$	150,000	$	150,000
Term Loan Facility		137,500		170,000
Revolving Credit Facility		134,000		71,000
Capital Leases		575		780

Total		422,075		391,780
Less—current portion		40,068		32,741

Long-term portion	$	382,007	$	359,039

2008 Refinancing Credit Agreement

On November 4, 2008, the Company refinanced its existing unsecured revolving credit agreement with a consortium of commercial banks. This "2008 Refinancing Credit Agreement" provides the company with a $300 million five-year revolving credit facility and a $200 million five-year term loan facility. The Company incurred $2.9 million of deferred financing cost related to the 2008 Refinancing Credit Agreement. Both facilities expire in January 2013. The 2008 Refinancing Credit Agreement borrowings bear variable interest rates indexed to the indices described below. At December 31, 2010, the Company had available bank borrowing capacity, net of $28.9 million of letters of credit, of approximately $137.1 million, subject to certain financial covenant restrictions.

Under the 2008 Refinancing Credit Agreement, the Company may elect a Base Rate of interest or an interest rate based on the London Interbank Offered Rate ("LIBOR") of interest ("the Alternate Rate"). The Base Rate adjusts on a daily basis and is the greater of the PNC, N.A. prime rate, 30-day LIBOR plus 150 basis points or the Federal Funds Effective Rate plus 0.5% per annum, plus a margin that ranges from 25 to 50 basis points. The Alternate rate is based on quoted LIBOR rates plus a margin that ranges from 125 to 200 basis points. Both the Base Rate and Alternate Rate margins are dependent on the Company's consolidated total indebtedness to cash flow ratios. The initial Base Rate margin is 25 basis points and the Alternate Rate margin is 125 basis points. At December 31, 2010 the weighted average interest rate on the Company's variable rate debt wa s 1.58%. To reduce the impact of interest rate changes on a portion of this variable-rate debt, the Company entered into an interest rate swap which effectively converted a portion of the debt from variable to fixed-rate borrowing during the term of the swap contract. On December 31, 2010, the notional value of the interest rate swaps outstanding was $137.0 million and effectively changed the Company's interest rate on bank debt at December 31, 2010 from a variable rate to a fixed rate of 2.27%. The interest rate swap agreements mature at various times through December 2012. The Company is exposed to credit risk in the event of nonperformance by the counterparty. However, since only the cash interest payments are exchanged, exposure is significantly less than the notional amount. The counterparty is a large financial institution with an excellent credit rating and history of performance. The Company currently believes the risk of nonperformance is negligible.

The 2008 Refinancing Credit Agreement limits the Company's ability to declare or pay cash dividends and prohibits the Company from declaring or making other distributions, subject to certain exceptions. The 2008 Refinancing Credit Agreement contains various other covenants and restrictions including the following limitations: incurrence of additional indebtedness; mergers, consolidations, sales of assets and acquisitions; additional liens; sale and leasebacks; permissible investments, loans and advances; certain debt payments; and imposes a minimum interest expense coverage ratio of 3.0 and a maximum debt to cash flow ratio of 3.25. The Company is in compliance with these measurements and covenants and expects that these measurements will not be any type of limiting factor in executing our operating activities.

6.875% Senior Notes Due August 2013

In August 2003, the Company issued $150 million of Senior Notes due in 2013 ("the Notes"). The Notes were issued at par. Interest on the Notes accrues at a rate of 6.875% per annum and is payable semi-annually on January 31 and July 31 of each year. The proceeds were used to repay debt outstanding under the Company's existing credit agreement, and for general corporate purposes. The principal balance is due in full at maturity.

The Notes are senior unsecured obligations of the Company and rank pari passu with all existing and future senior debt and senior to all our existing and future subordinated indebtedness of the Company. The indenture under which the Notes were issued contains covenants and restrictions which limit among other things, the following: the incurrence of indebtedness, payment of dividends and certain distributions, sale of assets, change in control, mergers and consolidations and the incurrence of liens.

Debt and Capital Leases

Scheduled principal repayments of debt and capital lease balances as of December 31, 2010 are as follows:


2011	$	40,065
2012		40,290
2013		341,541
2014		41
2015		30
Future years		108

Total	$	422,075

Employee Benefit Plans

12 Months Ended

Dec. 31, 2010

Employee Benefit Plans

Employee Benefit Plans

9.	EMPLOYEE BENEFIT PLANS

Defined Benefit Pension Plans

The Company sponsors defined benefit pension plans that cover certain U.S., Canadian, German, and United Kingdom employees and which provide benefits of stated amounts for each year of service of the employee. The Company uses a December 31 measurement date for the U.S., Canadian, German and U.K. plans.

The following tables provide information regarding the Company's defined benefit pension plans summarized by U.S. and international components.

Obligations and Funded Status


	U.S.						International
*In thousands*	2010			2009			2010			2009
Change in projected benefit obligation
Obligation at beginning of year	$	(47,027	)	$	(46,408	)	$	(128,997	)	$	(100,183	)
Service cost		(267	)		(282	)		(2,915	)		(2,775	)
Interest cost		(2,488	)		(2,745	)		(7,531	)		(6,864	)
Employee contributions		—			—			(459	)		(438	)
Plan curtailments		—			—			(1,040	)		(1,015	)
Plan amendments		—			(28	)		(84	)		—
Benefits paid		3,709			4,028			9,864			11,981
Expenses paid		—			—			402			660
Premiums paid		—			—			184			186
Acquisitions		—			—			—			(6,870	)
Actuarial loss		(1,550	)		(1,592	)		(9,318	)		(10,138	)
Effect of currency rate changes		—			—			(1,257	)		(13,541	)

Obligation at end of year	$	(47,623	)	$	(47,027	)	$	(141,151	)	$	(128,997	)

Change in plan assets
Fair value of plan assets at beginning of year	$	34,872		$	32,164		$	112,602		$	78,843
Actual return on plan assets		3,724			5,152			12,201			14,984
Employer contributions		4,851			1,584			8,364			11,897
Employee contributions		—			—			459			438
Benefits paid		(3,709	)		(4,028	)		(9,864	)		(11,981	)
Expenses paid		—			—			(402	)		(660	)
Premiums paid		—			—			(184	)		(186	)
Acquisitions		—			—			—			6,813
Effect of currency rate changes		—			—			2,392			12,454

Fair value of plan assets at end of year	$	39,738		$	34,872		$	125,568		$	112,602

Funded status
Fair value of plan assets	$	39,738		$	34,872		$	125,568		$	112,602
Benefit obligations		(47,623	)		(47,027	)		(141,151	)		(128,997	)

Funded Status	$	(7,885	)	$	(12,155	)	$	(15,583	)	$	(16,395	)

Amounts recognized in the statement of financial position consist of:
Noncurrent assets	$	—		$	—		$	3,514		$	4,124
Current liabilities		—			—			(370	)		(376	)
Noncurrent liabilities		(7,885	)		(12,155	)		(18,727	)		(20,143	)

Net amount recognized	$	(7,885	)	$	(12,155	)	$	(15,583	)	$	(16,395	)

Amounts recognized in accumulated other comprehensive income (loss) consist of:
Initial net obligation	$	—		$	—		$	(1,086	)	$	(1,291	)
Prior service costs		(222	)		(284	)		(1,076	)		(1,359	)
Net actuarial loss		(28,683	)		(29,242	)		(28,263	)		(25,145	)

Net amount recognized	$	(28,905	)	$	(29,526	)	$	(30,425	)	$	(27,795	)

The aggregate accumulated benefit obligation for the U.S. pension plans was $47.2 million and $46.5 million as of December 31, 2010 and 2009, respectively. The aggregate accumulated benefit obligation for the international pension plans was $131.2 million and $119.0 million as of December 31, 2010 and 2009, respectively.


	U.S.						International
*In thousands*	2010			2009			2010			2009
Information for pension plans with accumulated benefit obligations in excess of plan assets:
Projected benefit obligation	$	(47,623	)	$	(47,027	)	$	(73,387	)	$	(84,624	)
Accumulated benefit obligation		(47,217	)		(46,472	)		(67,298	)		(77,767	)
Fair value of plan assets		39,738			34,872			54,865			64,105
Information for pension plans with projected benefit obligations in excess of plan assets:
Projected benefit obligation	$	(47,623	)	$	(47,027	)	$	(82,368	)	$	(84,624	)
Fair value of plan assets		39,738			34,872			63,271			64,105

Components of Net Periodic Benefit Costs


	U.S.									International
*In thousands*	2010			2009			2008			2010			2009			2008
Service cost	$	267		$	282		$	278		$	2,915		$	2,775		$	3,299
Interest cost		2,488			2,745			2,763			7,531			6,864			7,438
Expected return on plan assets		(3,205	)		(3,269	)		(3,325	)		(7,807	)		(6,311	)		(8,344	)
Amortization of initial net obligation		—			—			—			158			180			250
Amortization of prior service cost		62			62			59			222			287			351
Amortization of net loss		1,590			1,392			1,229			1,524			1,418			868
Curtailment loss recognized		—			—			—			1,261			1,528			2,869
Settlement loss recognized		—			—			—			1,030			2,311			1,943

Net periodic benefit cost	$	1,202		$	1,212		$	1,004		$	6,834		$	9,052		$	8,674

Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income during 2010 are as follows:


*In thousands*	U.S.			International
Net loss arising during the year	$	(1,031	)	$	(4,992	)
Effect of exchange rates		—			(776	)
Amortization, settlement, or curtailment recognition of net transition obligation		—			158
Amortization or curtailment recognition of prior service cost		62			426
Amortization or settlement recognition of net loss		1,590			2,554

Total recognized in other comprehensive income (loss)	$	621		$	(2,630	)

Total recognized in net periodic benefit cost and other comprehensive loss	$	(581	)	$	(9,464	)


	U.S.									International
	2010			2009			2008			2010			2009			2008
Discount rate		5.20	%		5.75	%		6.25	%		5.43	%		6.11	%		6.69	%
Expected return on plan assets		8.00	%		8.00	%		8.00	%		6.94	%		7.34	%		7.15	%
Rate of compensation increase		3.00	%		3.00	%		3.00	%		3.17	%		3.28	%		3.47	%

The discount rate is based on settling the pension obligation with high grade, high yield corporate bonds, and the rate of compensation increase is based on actual experience. The expected return on plan assets is based on historical performance as well as expected future rates of return on plan assets considering the current investment portfolio mix and the long-term investment strategy.

As of December 31, 2010 the following table represents the amounts included in other comprehensive loss that are expected to be recognized as components of periodic benefit costs in 2011.


*In thousands*	U.S.		International
Net transition obligation	$	—	$	159
Prior service cost		62		210
Net actuarial loss		2,364		1,622

	$	2,426	$	1,991

Pension Plan Assets

The Company has established formal investment policies for the assets associated with our pension plans. Objectives include maximizing long-term return at acceptable risk levels and diversifying among asset classes. Asset allocation targets are based on periodic asset liability study results which help determine the appropriate investment strategies. The investment policies permit variances from the targets within certain parameters. The composition plan assets consist primarily of equity security funds, debt security funds, and temporary cash and cash equivalent investments. The assets held in these funds are generally passively managed and are valued at the net asset value per share multiplied by the number of shares held as of the measurement date. The balanced fund provides long-term growth and income by investing in a diversified portfolio of approximately 60% equ ities and 40% bonds. All plan assets are considered Level 1 based on the fair value valuation hierarchy (See Note 17 "Fair Value Measurement" included herein). Plan assets by asset category at December 31, 2010 and 2009 are as follows:


	U.S.				International
*In thousands*	2010		2009		2010		2009
Pension Plan Assets
Equity security funds	$	24,282	$	20,735	$	74,501	$	62,901
Debt security funds		14,947		13,755		47,575		37,958
Balanced fund		—		—		—		7,101
Cash and cash equivalents		509		382		3,492		4,642

Fair value of plan assets	$	39,738	$	34,872	$	125,568	$	112,602

The U.S. and International pension plans have target asset allocations of 60% equity securities and 40% debt securities. Investment policies are determined by the respective Plan's Pension Committee and set forth in its Investment Policy. Rebalancing of the asset allocation occurs on a quarterly basis.

Cash Flows

The Company's funding methods are based on governmental requirements and differ from those methods used to recognize pension expense. The Company expects to contribute $1.3 million to the U.S. plans and $5.9 million to the international plans during 2011.

Benefit payments expected to be paid to plan participants are as follows:


*In thousands*	U.S.		International
Year ended December 31,
2011	$	3,423	$	6,861
2012		3,546		6,975
2013		3,543		7,101
2014		3,559		7,341
2015		3,567		7,742
2016 through 2020		17,570		37,352

Post Retirement Benefit Plans

In addition to providing pension benefits, the Company has provided certain unfunded postretirement health care and life insurance benefits for a portion of North American employees. The Company is not obligated to pay health care and life insurance benefits to individuals who had retired prior to 1990.

The Company uses a December 31 measurement date for all post retirement plans. The following tables provide information regarding the Company's post retirement benefit plans summarized by U.S. and international components.

Obligations and Funded Status


	U.S.						International
*In thousands*	2010			2009			2010			2009
Change in projected benefit obligation
Obligation at beginning of year	$	(29,060	)	$	(31,228	)	$	(4,827	)	$	(2,790	)
Service cost		(45	)		(84	)		(60	)		(44	)
Interest cost		(1,599	)		(1,719	)		(300	)		(240	)
Plan amendments		2,074			2,744			71			—
Plan curtailments		—			1,330			164			324
Benefits paid		1,590			1,736			332			166
Acquisitions		—			—			—			(1,392	)
Actuarial (loss) gain		(4,574	)		(1,839	)		498			(325	)
Effect of currency rate changes		—			—			(227	)		(526	)

Obligation at end of year	$	(31,614	)	$	(29,060	)	$	(4,349	)	$	(4,827	)

Change in plan assets
Fair value of plan assets at beginning of year	$	—		$	—		$	—		$	—
Employer contributions		1,590			1,736			332			166
Benefits paid		(1,590	)		(1,736	)		(332	)		(166	)

Fair value of plan assets at end of year	$	—		$	—		$	—		$	—

Funded status
Fair value of plan assets	$	—		$	—		$	—		$	—
Benefit obligations		(31,614	)		(29,060	)		(4,349	)		(4,827	)

Funded status	$	(31,614	)	$	(29,060	)	$	(4,349	)	$	(4,827	)


	U.S.						International
*In thousands*	2010			2009			2010			2009
Amounts recognized in the statement of financial position consist of:
Current liabilities	$	(1,712	)	$	(1,753	)	$	(355	)	$	(354	)
Noncurrent liabilities		(29,902	)		(27,307	)		(3,994	)		(4,473	)

Net amount recognized	$	(31,614	)	$	(29,060	)	$	(4,349	)	$	(4,827	)

Amounts recognized in accumulated other comprehensive income (loss) consist of:
Initial net obligation	$	—		$	—		$	—		$	—
Prior service credit		17,933			18,422			748			862
Net actuarial (loss) gain		(31,319	)		(28,123	)		973			323

Net amount recognized	$	(13,386	)	$	(9,701	)	$	1,721		$	1,185

Components of Net Periodic Benefit Cost


	U.S.									International
*In thousands*	2010			2009			2008			2010			2009			2008
Service cost	$	45		$	84		$	242		$	60		$	44		$	50
Interest cost		1,599			1,719			2,005			300			240			203
Amortization of initial net obligation		—			—			—			—			15			27
Amortization of prior service credit		(2,563	)		(2,515	)		(2,420	)		(225	)		(203	)		(336	)
Amortization of net loss (gain)		1,378			1,246			1,657			(50	)		(62	)		(9	)
Curtailment gain recognized		—			(1,330	)		—			—			—			(1,136	)

Net periodic benefit (credit) cost	$	459		$	(796	)	$	1,484		$	85		$	34		$	(1,201	)

Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income during 2010 are as follows:


*In thousands*	U.S.			International
Prior service cost	$	2,074		$	71
Net (loss) gain arising during the year		(4,574	)		662
Effect of exchange rates		—			78
Amortization or curtailment recognition of prior service cost		(2,563	)		(225	)
Amortization or settlement recognition of net loss (gain)		1,378			(50	)

Total recognized in other comprehensive (loss) income	$	(3,685	)	$	536

Total recognized in net periodic benefit cost and other comprehensive (loss) income	$	(4,144	)	$	451

The weighted average assumptions in the following table represent the rates used to develop the actuarial present value of the projected benefit obligation for the year listed and also the net periodic benefit cost for the following year. The discount rate is based on settling the pension obligation with high grade, high yield corporate bonds.


	U.S.									International
	2010			2009			2008			2010			2009			2008
Discount rate		5.20	%		5.75	%		6.25	%		5.50	%		6.40	%		7.50	%

As of December 31, 2010 the following table represents the amounts included in other comprehensive loss that are expected to be recognized as components of periodic benefit costs in 2011.


*In thousands*	U.S.			International
Prior service credit	$	(2,661	)	$	(241	)
Net actuarial loss (gain)		1,684			(142	)

	$	(977	)	$	(383	)

The assumed health care cost trend rate for the U.S. plans grades from an initial rate of 7.6% to an ultimate rate of 4.5% by 2027 and for international plans from 8.4% to 4.5% by 2030. A 1% increase in the assumed health care cost trend rate will increase the service and interest cost components of the expense recognized for the U.S. and international postretirement plans by approximately $204,000 and $44,000, respectively, for 2011, and increase the accumulated postretirement benefit obligation by approximately $3.9 million and $335,000, respectively. A 1% decrease in the assumed health care cost trend rate will decrease the service and interest cost components of the expense recognized for the U.S. and international postretirement plans by approximately $173,000 and $37,000, respectively, for 2011, and decrease the accumulated postretirement benefit obligation by a pproximately $3.3 million and $285,000, respectively.

Cash Flows

Benefit payments expected to be paid to plan participants are as follows:


*In thousands*	U.S.		International
Year ended December 31,
2011	$	1,712	$	355
2012		1,630		355
2013		1,666		360
2014		1,739		370
2015		1,808		375
2016 through 2020		10,398		2,061

Defined Contribution Plans

The Company also participates in certain defined contribution plans and multiemployer pension plans. Costs recognized under these plans are summarized as follows:


	For the year ended December 31,
*In thousands*	2010		2009		2008
Multi-employer pension and health & welfare plans	$	2,831	$	990	$	1,356
401(k) savings and other defined contribution plans		8,030		8,685		8,315

Total	$	10,861	$	9,675	$	9,671

The 401(k) savings plan is a participant directed defined contribution plan that holds shares of the Company's stock as one of the investment options. At December 31, 2010 and 2009, the plan held on behalf of its participants about 433,300 shares with a market value of $22.9 million, and 428,000 shares with a market value of $17.5 million, respectively.

Additionally, the Company has stock option based benefit and other plans further described in Note 12.

Income Taxes

12 Months Ended

Dec. 31, 2010

Income Taxes

Income Taxes

10.

INCOME TAXES

The Company is responsible for filing consolidated U.S., foreign and combined, unitary or separate state income tax returns. The Company is responsible for paying the taxes relating to such returns, including any subsequent adjustments resulting from the redetermination of such tax liabilities by the applicable taxing authorities. The components of the income from continuing operations before provision for income taxes for the Company's domestic and foreign operations for the years ended December 31 are provided below:


	For the year ended December 31,
*In thousands*	2010		2009		2008
Domestic	$	113,430	$	105,122	$	145,791
Foreign		73,397		58,237		58,509

Income from continuing operations	$	186,827	$	163,359	$	204,300

No provision has been made for U.S., state, or additional foreign taxes related to undistributed earnings of $182.9 million of foreign subsidiaries which have been or are intended to be permanently re-invested.

The consolidated provision for income taxes included in the Statement of Income consisted of the following:


	For the year ended December 31,
*In thousands*	2010		2009			2008
Current taxes
Federal	$	24,570	$	19,174		$	44,651
State		3,671		3,625			5,505
Foreign		19,239		18,114			18,719

	$	47,480	$	40,913		$	68,875
Deferred taxes
Federal		11,205		6,426			6,309
State		1,163		1,485			1,371
Foreign		3,880		(520	)		(2,810	)

		16,248		7,391			4,870

Total provision	$	63,728	$	48,304		$	73,745

The consolidated income tax provision is included in the Statement of Income as follows:


	For the year ended December 31,
*In thousands*	2010		2009		2008
Continuing operations	$	63,728	$	48,304	$	73,746
Income (loss) from discontinued operations		—		—		(1	)

Total provision	$	63,728	$	48,304	$	73,745

A reconciliation of the United States federal statutory income tax rate to the effective income tax rate on continuing operations for the years ended December 31 is provided below:


	For the year ended December 31,
*In thousands*	2010			2009			2008
U. S. federal statutory rate		35.0	%		35.0	%		35.0	%
State taxes		2.0			2.2			2.5
Tax reserves		0.2			(5.1	)		0.5
Foreign		(1.9	)		(1.4	)		(1.0	)
Research and development credit		(1.0	)		(0.9	)		(1.0	)
Other, net		(0.2	)		(0.2	)		0.1

Effective rate		34.1	%		29.6	%		36.1	%

The effective income tax rate for 2009 included a net tax benefit of approximately $9.7 million which is due primarily to the settlement of examinations in various tax jurisdictions.

Deferred income taxes result from temporary differences in the recognition of income and expense for financial and income tax reporting purposes. These deferred income taxes will be recognized as future tax benefits or costs when the temporary differences reverse.

Components of deferred tax assets and liabilities were as follows:


	December 31,
*In thousands*	2010			2009
Deferred income tax assets:
Accrued expenses and reserves	$	10,035		$	11,834
Warranty reserve		11,832			9,986
Deferred comp/employee benefits		7,754			9,328
Pension and postretirement obligations		19,137			18,802
Inventory		7,461			7,792
State net operating loss		3,022			3,125
Foreign net operating loss		—			421
Tax credit carry forwards		4,795			4,360
Other		—			1,330

Gross deferred income tax assets		64,036			66,978
Valuation allowance		(2,471	)		(2,121	)

Total deferred income tax assets		61,565			64,857
Deferred income tax liabilities:
Property, plant & equipment		21,090			19,703
Intangibles		70,937			51,813
Other		3,124			—

Total deferred income tax liabilities		95,151			71,516

Net deferred income tax liability	$	(33,586	)	$	(6,659	)

A valuation allowance is provided when it is more likely than not that some portion or all of the deferred tax assets will not be realized. State net operating loss carryforwards exist in the amount of $58.3 million and are set to expire in various periods from 2012 to 2031.

Federal and foreign tax credits of approximately $1.8 million related to Research and Development credits have been fully utilized in 2010. State tax credits of approximately $866,000 are available and consist of various Machinery & Equipment, Research and Development, and Jobs related credits.

As of December 31, 2010, the liability for income taxes associated with uncertain tax positions was $10.0 million, of which $3.1 million, if recognized, would favorably affect the Company's effective income tax rate. As of December 31, 2009, the liability for income taxes associated with uncertain tax positions was $10.0 million, of which $2.6 million, if recognized, would favorably affect the Company's effective tax rate. A reconciliation of the beginning and ending amount of the liability for income taxes associated with uncertain tax positions follows:


*In thousands*	2010			2009			2008
Gross liability for uncertain tax positions at beginning of year	$	9,981		$	17,102		$	17,203
Gross increases—uncertain tax positions in prior periods		2,117			655			—
Gross decreases—uncertain tax positions in prior periods		(1,564	)		(562	)		—
Gross increases—current period uncertain tax positions		313			1,661			2,614
Gross decreases—audit settlements during year		(751	)		(8,753	)		(597	)
Gross decreases—expiration of audit statute of limitations		(122	)		(122	)		(2,118	)

Gross liability for uncertain tax positions at end of year	$	9,974		$	9,981		$	17,102

The Company includes interest and penalties related to uncertain tax positions in income tax expense. The total interest and penalties accrued as of December 31, 2010 and 2009 are approximately $3.1 million and $1.7 million, respectively.

The Internal Revenue Service is currently auditing the 2008 and 2009 tax years. With limited exception, the Company is no longer subject to examination by various U.S. and foreign taxing authorities for years before 2007.

At this time, the Company believes that it is reasonably possible that unrecognized tax benefits of approximately $3.4 million may change within the next 12 months due to the expiration of statutory review periods and current examinations.

Stock-Based Compensation Plans

12 Months Ended

Dec. 31, 2010

Stock-Based Compensation Plans

Stock-Based Compensation Plans

12.

STOCK-BASED COMPENSATION PLANS

As of December 31, 2010, the Company maintains employee stock-based compensation plans for stock options, non-vested restricted stock, and incentive stock awards as governed by the 2000 Stock Incentive Plan, as amended (the 2000 Plan). As of December 31, 2010, shares available for future grants under the 2000 Plan is 669,795 shares. No awards may be made under the 2000 Plan subsequent to January 31, 2016. The Company also maintains a Non-Employee Directors' Fee and Stock Option Plan (Directors Plan).

Stock-based compensation expense was $11.8 million, $3.6 million and $10.5 million for the years ended December 31, 2010, 2009 and 2008, respectively. The Company recognized associated tax benefits related to the stock-based compensation plans of $3.0 million, $1.6 million and $3.3 million for the respective periods. Included in the stock-based compensation expense for 2010 above is $2.2 million of expense related to stock options, $3.7 million related to non-vested restricted stock, $5.0 million related to incentive stock awards and $900,000 related to awards issued for Directors' fees. At December 31, 2010, unamortized compensation expense related to those stock options, non-vested restricted shares and incentive stock awards expected to vest totaled $13.6 million and will be recognized over a weighted average period of 1.3 years. < /p>

Stock Options Under the 2000 Plan, stock options are granted to eligible employees at the fair market value, which is the average of the high and low Wabtec stock price on the date of grant. Generally, the options become exercisable over a three or four year vesting period and expire ten years from the date of grant.

The Directors Plan, as amended, authorizes a total of 500,000 shares of Common Stock to be issued. Generally, options issued under the plan become exercisable over a three-year vesting period and expire ten years from the date of grant and restricted stock issued under the plan vests one year from the date of grant. In addition, as compensation for directors' fees, a total of 13,500 shares have been awarded to non-employee directors for each of the years ended December 31, 2009 and 2008. No awards may be made under the plan subsequent to October 31, 2016. As compensation for directors' fees for the year ended December 31, 2010, the Company issued a total of 18,302 shares of restricted stock to non-employee directors. The total number of shares issued under the plan as of December 31, 2010 was 380,302 shares.

The following table summarizes the Company's stock option activity and related information for both the 2000 Plan and Directors Plan for the years ended December 31:


	Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life		Aggregate intrinsic value (in thousands)
Outstanding at December 31, 2007		1,009,494		$	14.61		5.2	$	20,022
Granted		269,500			35.93				1,029
Exercised		(207,000	)		13.48				(5,437	)
Canceled		(17,750	)		20.37				(344	)

Outstanding at December 31, 2008		1,054,244		$	20.16		5.5	$	20,655
Granted		313,000			30.23				3,320
Exercised		(199,879	)		13.57				(5,450	)
Canceled		(48,112	)		26.16				(706	)

Outstanding at December 31, 2009		1,119,253		$	23.89		6.1	$	16,136
Granted		120,125			38.21				1,764
Exercised		(232,289	)		14.02				(9,030	)
Canceled		(8,700	)		33.30				(170	)

Outstanding at December 31, 2010		998,389		$	27.83		6.2	$	25,018

Exercisable at December 31, 2010		543,705		$	22.88		5.0	$	16,317

Options outstanding at December 31, 2010 were as follows:


Range of Exercise Prices	Number of Options Outstanding		Weighted Average Exercise Price of Options Outstanding		Weighted Average Remaining Contractual Life		Number of Options Currently Exercisable		Weighted Average Exercise Price of Options Currently Exercisable
Under $13.00		149,865	$	11.18		1.9		149,865	$	11.18
13.00 – 20.00		117,931		15.92		2.9		117,931		15.92
20.00 – 25.00		19,667		21.46		4.1		19,667		21.46
25.00 – 30.00		311,751		28.97		7.7		113,751		28.92
Over 30.00		399,175		37.03		7.8		142,491		36.32

		998,389	$	27.83				543,705	$	22.88

The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions:


	For the year ended December 31,
	2010			2009			2008
Dividend yield		.10	%		.13	%		.11	%
Risk-free interest rate		3.2	%		2.1	%		3.5	%
Stock price volatility		46.1			43.1			33.9
Expected life (years)		5.0			5.0			5.0
Weighted average fair value of options granted during the year	$	15.69		$	11.30		$	12.24

The dividend yield is based on the Company's dividend rate and the current market price of the underlying common stock at the date of grant. Expected life in years is determined from historical stock option exercise data. Expected volatility is based on the historical volatility of the Company's stock. The risk-free interest rate is based on the U.S. Treasury bond rates for the expected life of the option.

Non-Vested Restricted Stock and Incentive Stock Awards Under the 2000 Plan, eligible employees are granted non-vested restricted stock that generally vest over three or four years from the date of grant. In addition, the Company has issued incentive stock awards to eligible employees that vest upon attainment of certain cumulative three year performance goals. The incentive stock awards included in the table below represent the maximum number of shares that may ultimately vest. As of December 31, 2010, based on the Company's performance, we estimate that the majority of these stock awards will vest and have recorded compensation expense accordingly. If our estimate of the number of these stock awards expected to vest changes in a future accounting period, compensation expense could be reduced and will be recognized over the remaining vestin g period.

The following table summarizes the non-vested restricted stock and incentive stock awards activity and related information for both the 2000 Plan and Directors Plan for the years ended December 31:


	Non-Vested Restricted Stock			Incentive Stock Awards			Weighted Average Grant Date Fair Value
Outstanding at December 31, 2007		301,500			694,049		$	29.65
Granted		79,000			301,000			35.50
Vested		(83,708	)		(243,913	)		20.56
Canceled		(17,000	)		(51,470	)		27.30

Outstanding at December 31, 2008		279,792			699,666		$	35.12
Granted		89,500			174,000			29.00
Vested		(105,833	)		(170,334	)		36.39
Canceled		(22,175	)		(435,540	)		34.70

Outstanding at December 31, 2009		241,284			267,792		$	31.65
Granted		160,427			158,492			39.17
Vested		(114,509	)		(99,318	)		33.36
Canceled		(10,575	)		29,361			34.94

Outstanding at December 31, 2010		276,627			356,327		$	33.14

Compensation expense for the non-vested restricted stock and incentive stock awards is based on the closing price of the Company's common stock on the date of grant and recognized over the applicable vesting period.

Commitments and Contingencies

12 Months Ended

Dec. 31, 2010

Commitments and Contingencies

Commitments and Contingencies

18.

COMMITMENTS AND CONTINGENCIES

The Company is subject to a variety of environmental laws and regulations governing discharges to air and water, the handling, storage and disposal of hazardous or solid waste materials and the remediation of contamination associated with releases of hazardous substances. The Company believes its operations currently comply in all material respects with all of the various environmental laws and regulations applicable to our business; however, there can be no assurance that environmental requirements will not change in the future or that we will not incur significant costs to comply with such requirements.

Under terms of the purchase agreement and related documents for the 1990 Acquisition, American Standard, Inc., now known as Trane ("Trane"), has indemnified the Company for certain items including, among other things, certain environmental claims the Company asserted prior to 2000. If Trane was unable to honor or meet these indemnifications, the Company would be responsible for such items. In the opinion of Management, Trane currently has the ability to meet its indemnification obligations.

Claims have been filed against the Company and certain of its affiliates in various jurisdictions across the United States by persons alleging bodily injury as a result of exposure to asbestos-containing products. Most of these claims have been made against our wholly owned subsidiary, Railroad Friction Products Corporation (RFPC), and are based on a product sold by RFPC prior to the time that the Company acquired any interest in RFPC.

Most of these claims, including all of the RFPC claims, are submitted to insurance carriers for defense and indemnity or to non-affiliated companies that retain the liabilities for the asbestos-containing products at issue. We cannot, however, assure that all these claims will be fully covered by insurance or that the indemnitors or insurers will remain financially viable. Our ultimate legal and financial liability with respect to these claims, as is the case with other pending litigation, cannot be estimated.

It is Management's belief that the potential range of loss for asbestos-related bodily injury cases is not reasonably determinable at present due to a variety of factors, including: (1) the asbestos case settlement history of the Company's wholly owned subsidiary, RFPC; (2) the unpredictable nature of personal injury litigation in general; and (3) the uncertainty of asbestos litigation in particular. Despite this uncertainty, and although the results of the Company's operations and cash flows for any given period could be adversely affected by asbestos-related lawsuits, Management believes that the final resolution of the Company's asbestos-related cases will not be material to the Company's overall financial position, results of operations and cash flows. In general, this belief is based upon: (1) Wabtec's and RFPC's history of set tlements and dismissals of asbestos-related cases to date; (2) the inability of many plaintiffs to establish any exposure or causal relationship to RFPC's product; and (3) the inability of many plaintiffs to demonstrate any identifiable injury or compensable loss.

More specifically, as to RFPC, Management's belief that any losses due to asbestos-related cases would not be material is also based on the fact that RFPC owns insurance which provides coverage for asbestos-related bodily injury claims. To date, RFPC's insurers have provided RFPC with defense and indemnity in these actions. The overall number of new claims being filed against RFPC has dropped significantly in recent years; however, these new claims, and all previously filed claims, may take a significant period of time to resolve. As to Wabtec and its divisions, Management's belief that asbestos-related cases will not have a material impact is also based on its position that it has no legal liability for asbestos-related bodily injury claims, and that the former owners of Wabtec's assets retained asbestos liabilities for the products at issue. To date, Wabtec has been able to successfully defend itself on this basis, including two arbitration decisions and a judicial opinion, all of which confirmed Wabtec's position that it did not assume any asbestos liabilities from the former owners of certain Wabtec assets. Although Wabtec has incurred defense and administrative costs in connection with asbestos bodily injury actions, these costs have not been material, and the Company has no information that would suggest these costs would become material in the foreseeable future.

The Company is subject to a RCRA Part B Closure Permit ("the Permit") issued by the Environmental Protection Agency (EPA) and the Idaho Department of Health and Welfare, Division of Environmental Quality relating to the monitoring and treatment of groundwater contamination on, and adjacent to, the MotivePower Inc. (Boise, Idaho) facility. In compliance with the Permit, the Company has completed an accelerated plan for the treatment of contaminated groundwater, and continues onsite and offsite monitoring for hazardous constituents. Reflected in the commitments and contingencies line of the consolidated balance sheet, the Company has accruals of approximately $571,000 at December 31, 2010, the estimated remaining costs for remediation and monitoring. The Company was in compliance with the Permit at December 31, 2010.

Foster Wheeler Energy Corporation (FWEC), the seller of the Mountaintop, Pennsylvania property to the predecessor of one of the Company's subsidiaries in 1989, agreed to indemnify the Company's predecessor and its successors and assigns against certain identified environmental liabilities for which FWEC executed a Consent Order Agreement with the Pennsylvania Department of Environmental Protection (PADEP) and EPA. Management believes that this indemnification arrangement is enforceable for the benefit of the Company and that FWEC has the financial resources to honor its obligations under this indemnification arrangement.

Prior to the Company's acquisition of Young Radiator, Young agreed to clean up alleged contamination on a prior production site in Mattoon, Illinois. The Company has completed the remediation of the site under the state's voluntary cleanup program and has obtained closure certification for the site from the State of Illinois.

Young ceased manufacturing operations at its Racine, Wisconsin facility in the early 1990s. Investigations prior to the acquisition of Young revealed some levels of contamination on the Racine property. The Company has completed a comprehensive site evaluation and implemented a groundwater remediation program under Wisconsin's voluntary remediation program. Site monitoring is being conducted to demonstrate attainment of Wisconsin's cleanup requirements. The Company believes the regulating authority is generally in agreement with the selected remediation approach and findings presented to-date.

Reflected in the commitments and contingencies line of the consolidated balance sheet, the Company has reserves of $369,000 at December 31, 2010, relating to certain sales leaseback transactions, for locomotives that were assumed in connection with the MotivePower merger in 1999.

On October 18, 2007, Faiveley Transport Malmo AB ("Faiveley Malmo") filed a request for arbitration with the International Chamber of Commerce alleging breach of contract and trade secret violations relating to the Company's manufacture and sale of certain components. The components at issue are limited in number and used in the transit industry. On that same day, Faiveley Malmo also filed a related proceeding against the Company in the United States District Court for the Southern District of New York ("Federal Court"), requesting a preliminary injunction in aid of the arbitration. In both forums, Faiveley sought to prevent the Company from manufacturing and selling the subject components until the arbitration panel decides Faiveley's claim. In the arbitration, Faiveley also sought monetary damages.

In the Federal Court action, Faiveley Malmo's request for a preliminary injunction was initially granted, in part, on August 22, 2008. That injunction was vacated by the appellate court on March 9, 2009, and the case was remanded to the District Court for further proceedings. On remand, Faiveley Malmo renewed its request for injunctive relief. The District Court denied that request on August 31, 2009, and Faiveley Malmo appealed that denial to the appellate court. Faiveley Malmo later voluntarily dismissed that appeal.

In the international arbitration proceeding, Faiveley Malmo originally alleged $128 million in damages, but later reduced its claim to $91 million in damages. The Company has stated that Faiveley Malmo's claims were grossly overstated, not supported by the facts or circumstances surrounding the case, and frivolous in most respects. An ICC International Court of Arbitration Arbitral Tribunal heard the case during the first half of 2009 and issued an award dated December 21, 2009. Pursuant to the Award, the Company was required to make a $3.9 million royalty payment to Faiveley Malmo, with respect to Faiveley Malmo's claims against the Company alleging breach of contract and trade secret violations. Faiveley Malmo's parent company, Faiveley Transport, stated that other Faiveley entities were considering filing claims against the Company arising from the same al legations.

On May 14, 2010, Faiveley Transport USA, Inc., Faiveley Transport Nordic AB, Faiveley Transport Amiens S.A.S, and Ellcon National, Inc. filed a complaint against Wabtec Corporation in the U.S. District Court for the Southern District of New York. That complaint was amended on June 8, 2010. The claims in the amended complaint include misappropriation of trade secrets, unfair competition, tortious interference with prospective business relations, tortious interference with prospective economic advantage, and unjust enrichment. On June 25, 2010, the Company filed a motion to dismiss the Faiveley entities' amended complaint in its entirety. That motion to dismiss was denied. In November 2010, the plaintiffs asserted a claim for $17.2 million in compensatory and other unspecified damages. The Company is vigorously contesting all claims and does n ot believe that they would result in any material legal liability. On December 10, 2010 the Company filed a motion for summary judgment and the plaintiffs filed a motion for partial summary judgment. Briefing on those motions was completed on December 29, 2010 and oral argument was heard on January 7, 2011. Trial is scheduled to begin on June 13, 2011

From time to time the Company is involved in litigation relating to claims arising out of its operations in the ordinary course of business. As of the date hereof, the Company is involved in no litigation that the Company believes will have a material adverse effect on its financial condition, results of operations or liquidity.

Segment Information

12 Months Ended

Dec. 31, 2010

Segment Information

Segment Information

19.

SEGMENT INFORMATION

Wabtec has two reportable segments—the Freight Group and the Transit Group. The key factors used to identify these reportable segments are the organization and alignment of the Company's internal operations, the nature of the products and services, and customer type. The business segments are:

Freight Group primarily manufactures and services components for new and existing freight cars and locomotives, builds new switcher locomotives, rebuilds freight locomotives, supplies railway electronics, positive train control equipment, signal design and engineering services, and provides related heat exchange and cooling systems. Customers include large, publicly traded railroads, leasing companies, manufacturers of original equipment such as locomotives and freight cars, and utilities.

Transit Group primarily manufactures and services components for new and existing passenger transit vehicles, typically subway cars and buses, builds new commuter locomotives and refurbishes subway cars. Customers include public transit authorities and municipalities, leasing companies, and manufacturers of subway cars and buses around the world.

The Company evaluates its business segments' operating results based on income from operations. Corporate activities include general corporate expenses, elimination of intersegment transactions, interest income and expense and other unallocated charges. Since certain administrative and other operating expenses and other items have not been allocated to business segments, the results in the following tables are not necessarily a measure computed in accordance with generally accepted accounting principles and may not be comparable to other companies.

Segment financial information for 2010 is as follows:


*In thousands*	Freight Group		Transit Group		Corporate Activities and Elimination			Total
Sales to external customers	$	784,504	$	722,508		—		$	1,507,012
Intersegment sales/(elimination)		17,740		3,437		(21,177	)		—

Total sales	$	802,244	$	725,945	$	(21,177	)	$	1,507,012

Income (loss) from operations	$	122,127	$	95,563	$	(14,880	)	$	202,810
Interest expense and other		—		—		(15,983	)		(15,983	)

Income (loss) from continuing operations before income taxes	$	122,127	$	95,563	$	(30,863	)	$	186,827

Depreciation and amortization		26,336		11,580		670			38,586
Capital expenditures		11,765		8,016		1,062			20,843
Segment assets		1,543,839		903,879		(644,637	)		1,803,081

Segment financial information for 2009 is as follows:


*In thousands*	Freight Group		Transit Group		Corporate Activities and Elimination			Total
Sales to external customers	$	588,399	$	813,217		—		$	1,401,616
Intersegment sales/(elimination)		26,040		2,442		(28,482	)		—

Total sales	$	614,439	$	815,659	$	(28,482	)	$	1,401,616

Income (loss) from operations	$	74,101	$	128,795	$	(22,864	)	$	180,032
Interest expense and other		—		—		(16,673	)		(16,673	)

Income (loss) from continuing operations before income taxes	$	74,101	$	128,795	$	(39,537	)	$	163,359

Depreciation and amortization		22,128		12,940		451			35,519
Capital expenditures		9,199		7,791		1,298			18,288
Segment assets		1,226,145		929,855		(570,165	)		1,585,835

Segment financial information for 2008 is as follows:


*In thousands*	Freight Group		Transit Group		Corporate Activities and Elimination			Total
Sales to external customers	$	773,523	$	801,226		—		$	1,574,749
Intersegment sales/(elimination)		22,558		2,615		(25,173	)		—

Total sales	$	796,081	$	803,841	$	(25,173	)	$	1,574,749

Income (loss) from operations	$	133,463	$	98,792	$	(19,739	)	$	212,516
Interest expense and other		—		—		(8,216	)		(8,216	)

Income (loss) from continuing operations before income taxes	$	133,463	$	98,792	$	(27,955	)	$	204,300

Depreciation and amortization		16,206		12,916		704			29,826
Capital expenditures		12,178		7,164		373			19,715
Segment assets		1,055,621		883,440		(431,541	)		1,507,520

The following geographic area data as of and for the years ended December 31, 2010, 2009 and 2008, respectively, includes net sales based on product shipment destination and long-lived assets, which consist of plant, property and equipment, net of depreciation, resident in their respective countries:


	Net Sales						Long-Lived Assets
*In thousands*	2010		2009		2008		2010		2009		2008
United States	$	815,001	$	838,263	$	930,160	$	125,081	$	121,427	$	130,890
Canada		172,509		134,811		136,282		16,290		17,203		14,694
Mexico		45,079		31,515		55,150		5,946		6,778		6,012
United Kingdom		130,346		139,804		179,861		6,747		6,490		5,935
Australia		76,168		59,016		72,037		5,373		5,216		4,529
Italy		41,653		38,989		39,102		19,801		19,798		21,560
China		30,052		18,372		10,316		2,925		269		227
Germany		29,992		33,478		32,348		14,203		15,242		15,663
Other international		166,212		107,368		119,493		9,859		9,284		7,948

Total	$	1,507,012	$	1,401,616	$	1,574,749	$	206,225	$	201,707	$	207,548

Export sales from the Company's United States operations were $327.2 million, $241.3 million and $261.8 million for the years ended December 31, 2010, 2009 and 2008, respectively.

Sales by product are as follows:


*In thousands*	2010		2009		2008
Freight Electronics & Specialty Products	$	482,406	$	333,760	$	393,288
Brake Products		441,831		465,079		545,528
Remanufacturing, Overhaul & Build		272,527		285,466		338,354
Other Transit Products		220,152		247,485		223,419
Other		90,096		69,826		74,160

Total Sales	$	1,507,012	$	1,401,616	$	1,574,749

Guarantor Subsidiaries Financial Information

12 Months Ended

Dec. 31, 2010

Guarantor Subsidiaries Financial Information

Guarantor Subsidiaries Financial Information

21.

GUARANTOR SUBSIDIARIES FINANCIAL INFORMATION

Effective August 2003, the Company issued $150 million of Senior Notes due in 2013 ("The Notes"). The obligations under the Notes are fully and unconditionally guaranteed by all U.S. subsidiaries as guarantors. In accordance with positions established by the Securities and Exchange Commission, the following shows separate financial information with respect to the parent, the guarantor subsidiaries and the non-guarantor subsidiaries. The principal elimination entries eliminate investment in subsidiaries and certain intercompany balances and transactions.

Balance Sheet for December 31, 2010:


*In thousands*	Parent			Guarantors			Non-Guarantors		Elimination			Consolidated
Cash and cash equivalents	$	42,714		$	13,226		$	181,001	$	—		$	236,941
Accounts receivable		371			149,015			108,763		—			258,149
Inventories		—			183,607			69,884		—			253,491
Other current assets		41,600			2,700			9,072		—			53,372

Total current assets		84,685			348,548			368,720		—			801,953
Property, plant and equipment, net		2,614			122,467			81,144		—			206,225
Goodwill		7,980			395,902			141,950		—			545,832
Investment in Subsidiaries		2,380,766			533,249			403,412		(3,317,427	)		—
Other intangibles, net		—			155,475			61,438		—			216,913
Other long term assets		(5,279	)		(1,928	)		39,365		—			32,158

Total assets	$	2,470,766		$	1,553,713		$	1,096,029	$	(3,317,427	)	$	1,803,081

Current liabilities	$	66,722		$	174,188		$	107,464	$	—		$	348,374
Intercompany		1,043,791			(1,097,899	)		54,108		—			—
Long-term debt		381,500			258			249		—			382,007
Other long term liabilities		75,366			33,570			60,377		—			169,313

Total liabilities		1,567,379			(889,883	)		222,198		—			899,694
Stockholders' equity		903,387			2,443,596			873,831		(3,317,427	)		903,387

Total Liabilities and Stockholders' Equity	$	2,470,766		$	1,553,713		$	1,096,029	$	(3,317,427	)	$	1,803,081

Balance Sheet for December 31, 2009:


*In thousands*	Parent			Guarantors			Non-Guarantors		Elimination			Consolidated
Cash and cash equivalents	$	12,026		$	12,124		$	164,509	$	—		$	188,659
Accounts receivable		522			121,203			86,535		—			208,260
Inventories		—			166,638			72,695		—			239,333
Other current assets		38,038			5,040			10,179		—			53,257

Total current assets		50,586			305,005			333,918		—			689,509
Property, plant and equipment, net		2,232			119,195			80,280		—			201,707
Goodwill		7,980			337,603			137,395		—			482,978
Investment in Subsidiaries		2,102,458			452,653			382,942		(2,938,053	)		—
Other intangibles, net		—			127,705			59,925		—			187,630
Other long term assets		(1,416	)		(7,360	)		32,787		—			24,011

Total assets	$	2,161,840		$	1,334,801		$	1,027,247	$	(2,938,053	)	$	1,585,835

Current liabilities	$	55,907		$	158,077		$	91,364	$	—		$	305,348
Intercompany		907,149			(986,903	)		79,754		—			—
Long-term debt		358,500			316			223		—			359,039
Other long term liabilities		61,371			18,575			62,589		—			142,535

Total liabilities		1,382,927			(809,935	)		233,930		—			806,922
Stockholders' equity		778,913			2,144,736			793,317		(2,938,053	)		778,913

Total Liabilities and Stockholders' Equity	$	2,161,840		$	1,334,801		$	1,027,247	$	(2,938,053	)	$	1,585,835

Income Statement for the Year Ended December 31, 2010:


*In thousands*	Parent			Guarantors			Non-Guarantors			Elimination (1)			Consolidated
Net sales	$	—		$	1,089,937		$	497,851		$	(80,776	)	$	1,507,012
Cost of sales		1,152			(725,704	)		(383,975	)		50,593			(1,057,934	)

Gross profit (loss)		1,152			364,233			113,876			(30,183	)		449,078
Total operating expenses		(46,891	)		(135,745	)		(63,632	)		—			(246,268	)

(Expense) income from operations		(45,739	)		228,488			50,244			(30,183	)		202,810
Interest (expense) income, net		(22,749	)		5,911			915			—			(15,923	)
Other (expense) income, net		4,928			1,139			(6,127	)		—			(60	)
Equity earnings (loss)		215,042			34,613			—			(249,655	)		—

Pretax income (loss)		151,482			270,151			45,032			(279,838	)		186,827
Income tax expense		(28,383	)		(13,461	)		(21,884	)		—			(63,728	)

Net income (loss) attributable to Wabtec shareholders	$	123,099		$	256,690		$	23,148		$	(279,838	)	$	123,099

Income Statement for the Year Ended December 31, 2009:


*In thousands*	Parent			Guarantors			Non-Guarantors			Elimination (1)			Consolidated
Net sales	$	—		$	1,055,493		$	421,762		$	(75,639	)	$	1,401,616
Cost of sales		1,662			(726,375	)		(322,833	)		39,256			(1,008,290	)

Gross profit (loss)		1,662			329,118			98,929			(36,383	)		393,326
Total operating expenses		(37,045	)		(118,604	)		(57,645	)		—			(213,294	)

(Expense) income from operations		(35,383	)		210,514			41,284			(36,383	)		180,032
Interest (expense) income, net		(23,207	)		5,917			616			—			(16,674	)
Other (expense) income, net		1,313			(9,869	)		8,557			—			1
Equity earnings (loss)		185,071			32,362			—			(217,433	)		—

Pretax income (loss)		127,794			238,924			50,457			(253,816	)		163,359
Income tax expense		(12,739	)		(11,880	)		(23,685	)		—			(48,304	)

Net income (loss) attributable to Wabtec shareholders	$	115,055		$	227,044		$	26,772		$	(253,816	)	$	115,055

Income Statement for the Year Ended December 31, 2008:


*In thousands*	Parent			Guarantors			Non-Guarantors			Elimination (1)			Consolidated
Net sales	$	—		$	1,154,546		$	527,908		$	(107,705	)	$	1,574,749
Cost of sales		(163	)		(763,456	)		(440,910	)		56,966			(1,147,563	)

Gross profit (loss)		(163	)		391,090			86,998			(50,739	)		427,186
Total operating expenses		(54,166	)		(110,855	)		(49,649	)		—			(214,670	)

(Expense) income from operations		(54,329	)		280,235			37,349			(50,739	)		212,516
Interest (expense) income, net		(20,620	)		8,432			3,680			—			(8,508	)
Other income (expense), net		43			5,051			(4,802	)		—			292
Equity earnings (loss)		249,331			35,127			—			(284,458	)		—

Pretax income (loss)		174,425			328,845			36,227			(335,197	)		204,300
Income tax expense		(43,874	)		(12,543	)		(17,329	)		—			(73,746	)

Income (loss) from continuing operations		130,551			316,302			18,898			(335,197	)		130,554
Income (loss) from discontinued operations (net of tax)		—			—			(3	)		—			(3	)

Net income (loss) attributable to Wabtec shareholders	$	130,551		$	316,302		$	18,895		$	(335,197	)	$	130,551

(1)	Includes elimination of gross profit realized with certain intercompany transactions between Guarantor and Non-Guarantor subsidiaries.

Condensed Statement of Cash Flows for the Year Ended December 31, 2010:


*In thousands*	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net cash provided by (used in) operating activities	$	5,719		$	381,874		$	68,381		$	(279,838	)	$	176,136
Net cash used in investing activities		(1,062	)		(124,006	)		(31,187	)		—			(156,255	)
Net cash provided by (used in) financing activities		26,031			(256,766	)		(23,255	)		279,838			25,848
Effect of changes in currency exchange rates		—			—			2,553			—			2,553

Increase in cash		30,688			1,102			16,492			—			48,282
Cash, beginning of period		12,026			12,124			164,509			—			188,659

Cash, end of period	$	42,714		$	13,226		$	181,001		$	—		$	236,941

Condensed Statement of Cash Flows for the Year Ended December 31, 2009:


*In thousands*	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net cash (used in) provided by operating activities	$	(12,484	)	$	340,765		$	87,835		$	(253,816	)	$	162,300
Net cash used in investing activities		(1,298	)		(105,839	)		(8,084	)		—			(115,221	)
Net cash (used in) provided by financing activities		(12,133	)		(227,074	)		(27,566	)		253,816			(12,957	)
Effect of changes in currency exchange rates		—			—			12,732			—			12,732

(Decrease) increase in cash		(25,915	)		7,852			64,917			—			46,854
Cash, beginning of period		37,941			4,272			99,592			—			141,805

Cash, end of period	$	12,026		$	12,124		$	164,509		$	—		$	188,659

Condensed Statement of Cash Flows for the Year Ended December 31, 2008:


*In thousands*	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net cash (used in) provided by operating activities	$	(214,862	)	$	630,431		$	75,428		$	(335,197	)	$	155,800
Net cash used in investing activities		(362	)		(319,198	)		(97,881	)		—			(417,441	)
Net cash provided by (used in) financing activities		170,254			(316,965	)		1,225			335,197			189,711
Effect of changes in currency exchange rates		—			—			(20,954	)		—			(20,954	)

Decrease in cash		(44,970	)		(5,732	)		(42,182	)		—			(92,884	)
Cash, beginning of period		82,911			10,004			141,774			—			234,689

Cash, end of period	$	37,941		$	4,272		$	99,592		$	—		$	141,805

Consolidated Statements of Cash Flows (Parenthetical) - $ / shares	12 Months Ended
	Dec. 31, 2010	Dec. 31, 2009	Dec. 31, 2008
Consolidated Statements of Cash Flows
Cash dividends, per share	$ 0.04	$ 0.04	$ 0.04

Consolidated Statements of Shareholders' Equity (Parenthetical) - USD ($)	12 Months Ended
	Dec. 31, 2010	Dec. 31, 2009	Dec. 31, 2008
Consolidated Statements of Shareholders' Equity
Cash dividends, per share	$ 0.04	$ 0.04	$ 0.04
Unrealized gains (loss) on foreign exchange contracts, tax	30,000	55,000	15,000
Unrealized (loss) on interest rate swap contracts, tax	980,000	25,000
Change in pension and post retirement benefit plans, tax	$ 1,807,000	$ 2,583,000	$ 4,493,000

Preferred Stock	12 Months Ended
Preferred Stock	Dec. 31, 2010
Preferred Stock
Preferred Stock	div table style="border-collapse: collapse;" border="0" cellspacing="0" cellpadding="0" width="100%" trtd valign="top" width="4%" align="left"font style="font-family: Times New Roman;" class="_mt" size="2"b16./b/font/td td valign="top" align="left"font style="font-family: Times New Roman;" class="_mt" size="2"bPREFERRED STOCK /b/font/td/tr/table p style="margin-top: 6px; text-indent: 4%; margin-bottom: 0px;"font style="font-family: Times New Roman;" class="_mt" size="2"The Company's authorized capital stock includes 1,000,000 shares of preferred stock. The Board of Directors has the authority to issue the preferred stock and to fix the designations, powers, preferences and rights of the shares of each such class or series, including dividend rates, conversion rights, voting rights, terms of redemption and liquidation preferences, without any further vote or action by the Company's shareholders. The rights and preferences of the preferred stock would be superior to those of the common stock. At Decembernbsp;31, 2010 and 2009 there was no preferred stock issued or outstanding. /font/p /div

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2010	Dec. 31, 2009
Consolidated Balance Sheets
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares issued	0	0
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	66,174,767	66,174,767
Common stock, outstanding	47,954,085	47,688,695
Treasury stock, shares	18,220,682	18,486,072