China’s ambitions to become a top leader in the railway industry is threatening U.S. national security, according to industry experts and lawmakers.
Chinese rail manufacturers have been able to expand quickly globally due to Beijing’s government policies and heavy subsidies.
One company in particular, the state-owned rail car manufacturer China Railway Rolling Stock Corporation (CRRC), has racked up several contracts in major U.S. cities in recent years.
Concerned that the partnerships could pose security threats, a bipartisan group of U.S. senators recently sought to address the issue with new legislation.
The Transit Infrastructure Vehicle Security Act was introduced by U.S. Sens. John Cornyn (R-Texas) and Tammy Baldwin (D-Wisc.) on March 15, which would prohibit federal money from being used to award a procurement contract or subcontract for passenger rail cars and transit buses to Chinese state-owned, controlled, or subsidized enterprises, according to a press release from the office of Sen. Sherrod Brown (D-Ohio). Brown and his colleague Mike Crapo (R-Idaho) are co-sponsors of the legislation.
“China poses a clear and present danger to our national security and has already infiltrated our rail and bus manufacturing industries,” Cornyn said in the press release, arguing that the new legislation would help safeguard the U.S. transportation and infrastructure sectors.
Recent Deals
China’s CRRC succeeded in winning contracts in several major U.S. cities to supply rail cars. According to local news site Boston.com, CRRC was awarded an $843 million contract by the Massachusetts Bay Transportation Authority to assemble 404 subway cars in 2014.
Then, in March 2016, the Chicago transport authority contracted CRRC to build 846 rail cars for $1.3 billion, according to Reuters.
A year later, the Los Angeles County Metropolitan Transportation Authority awarded CRRC with a $647 million contract to supply 282 subway cars, according to Reuters.
Winning mass transit contracts is just the first step in China’s agenda to take over the U.S. freight rail sector, retired U.S. Brigadier General John Adams warned in a report he wrote for the U.S. industry group Rail Security Alliance in October last year.
“The Chinese government is banking on the fact that once CRRC secures sufficient U.S. municipal transit contracts, it can pivot quickly and inexpensively toward the more strategically important [U.S.] freight rail sector,” Adams wrote.
Freight railroads play a key role in U.S. military operations, such as transporting military equipment to their destinations. The report warned that Chinese-made rail cars would provide Beijing knowledge of “early and reliable warning of U.S. military mobilization,” based on information such as GPS train locations.
The new bill also seeks to improve cybersecurity within U.S. public transportation systems, such as by requiring any rail transit operator to develop and execute a plan for identifying and reducing cybersecurity risks.
