Ottawa Announces Nearly $2 Billion for 45 Hybrid Battery-Diesel Via Rail Passenger Trains

Minister of Transport Steven MacKinnon announces a government investment to renew VIA Rail’s long-distance, regional and remote locomotive fleet while bringing passenger locomotive assembly back to Canada at VIA Rail's maintenance centre in Montreal on July 29, 2026. The Canadian Press/Christinne Muschi

The federal government has announced $1.95 billion to modernize Via Rail’s passenger locomotive fleet with 45 new hybrid battery-diesel locomotives.

Transport Minister Steven MacKinnon told reporters in Montreal on July 29 that the new trains would “serve Canadians travelling on long-distance, rural, and remote routes.” Up to 36 of the locomotives, which will be built by Swiss rail manufacturer Stadler, will be assembled in Canada.

In a statement, MacKinnon said the locomotives will be the first hybrid-powered passenger locomotives in North America, and will “lay the groundwork for future zero-emission propulsion.”

MacKinnon also said that passenger rail locomotive assembly would be being brought back to Montreal for the “first time in more than 25 years.”

MacKinnon said while $1.6 billion will go toward the construction of the new trains, $357 million will be allocated to building a new assembly and maintenance facility in Montreal. That facility will be built by the Canadian construction company Pomerleau.

The government estimates the upgrades will support around 1,200 full-time jobs in manufacturing, construction, and engineering.

Budget 2024 had proposed $462.4 million over the course of five years for Via Rail network operations, which included new funding for the corporation to “replace its aging fleet on routes outside the Quebec City-Windsor corridor.”

Alto Railway

During the press conference, MacKinnon was asked about reports that the Ontario government was rethinking its support for the federal government’s Alto high-speed rail, after Ottawa had rejected Ontario’s plan to allow jets to land at Toronto’s Billy Bishop airport.

Ontario had plans to expand the airport to accommodate jets and make upgrades to the terminal in order to boost Billy Bishop’s annual passenger traffic from 2 million per year to up to 10 million. But Ottawa rejected the proposal on July 24, citing concerns about noise, environmental impacts, and effects on waterfront access, following opposition from community groups and some Toronto residents.

Ontario Transport Minister Prabmeet Sarkaria said on July 28 that he was “disappointed” in the government’s decision, adding, “if this is how they’re going to treat bigger projects, I don’t think you’ll get much built.” The same day, 11 Ontario MPPs put out a statement questioning the Alto high-speed rail project, and said “too many voices have been ignored.”

MacKinnon said that major infrastructure projects will “always come with their share of concerns that we have to listen very carefully to,” but that the railway is a project “that makes Canadians dream, that will improve their life, will improve their mobility.”

The transport minister said the federal government will work “responsibly” with other jurisdictions on the railway, but that there would still be “controversy.”

The Alto rail is a 1,000-kilometre high-speed rail corridor that would stretch from Toronto to Quebec City. The Alto Crown corporation, which is behind the project, estimates that the railway could cost between $60 billion and $90 billion, while Ottawa has projected it would create 51,000 jobs over 10 years.

Communities across Ontario and Quebec have raised concerns with the federal government’s powers to expropriate land for the railway if Alto is unsuccessful in purchasing it from owners, and have said they do not want to see the railway run through their communities. The federal Conservatives oppose the railway, saying the cost of the infrastructure project is too high.