CRRC breaks ground in Chicago

Chinese railcar manufacturer CRRC Sifang America broke ground on Thursday in Chicago for a $100 million plant that will build cars for the city's transit authority and become the company's North American hub for the assembly of railcars.

In 2016, CRRC Sifang, a unit of China Railway Rolling Stock Corp, was awarded a $1.3 billion contract by the Chicago Transit Authority (CTA) to supply more than 840 new railcars to replace approximately half of the agency's fleet. As part of the contract, the company agreed to make the railcars in Chicago.

In addition to fulfilling the CTA contract, the plant will give the company a foothold in North America to assemble rail cars and, potentially, high-speed trains, CRRC officials said.

The 380,944-square-foot railcar manufacturing plant will be on 45 acres in Chicago's Hegewisch neighborhood on the Southeast Side, the first of its kind in the city in 35 years. The factory will employ around 170 workers - the majority of them union, high-skilled, sheet metal and electrical workers - and create almost another 130 construction jobs. CRRC Sifang America will spend $7 million to train the factory workers, according to a statement from Chicago Mayor Rahm Emanuel's office.

"CRRC Sifang America is grateful for the opportunity to work with the Chicago Transit Authority to produce the next generation of railcars in Chicago, for Chicago," CRRC Corporation Vice-President Sun Yongcai said in a statement. "We are committed to producing top-of-the-line railcars to enhance CTA rider experience, while also creating new jobs at our assembly facility in the city."

Emanuel said the plant represents a major investment in Chicago that will bring economic development to the Southeast Side, while creating good-paying jobs "The railcars that emerge from this facility will be the latest step we've taken to invest in world-class transportation, and to create a 21st Century transit system," he said in a statement.

Production will begin in early 2019, and after testing the cars are expected on the rails by 2020. The new cars will

replace the CTA's oldest rail cars, which date back more than 30 years, officials said.

It will be CRRC's second plant in the US. Construction began on a $95 million plant in Springfield, Massachusetts, in 2015 to build rail cars for Boston's transportation agency. Completion of that plant is scheduled for this year, and the first cars from that plant are expected to be delivered to Boston in 2018.

The Chinese government combined train-makers CSR Corp and China CNR Corp to form CRRC in 2015 in a bid to better compete with Germany's Siemens AG and France's Alstom SA.

Encouraged by Beijing, China's railway firms are eager to export their technology by aggressively bidding for contracts in overseas markets. Earlier this year, CRRC Chairman Liu Hualong said the company wants to build up its international business and will target developed markets like the US.

He said that CRRC would also seek overseas acquisitions, especially to break into hard-to-penetrate markets like Europe. CRRC's overseas revenue more than doubled to 26.4 billion yuan ($3.83 billion) in 2016, the most for the Beijing-based company on record and making up 11 percent of its overall sales.

paulwelitzkin@chinadailyusa.com