The new double-decker regional rail passenger cars are three years behind schedule, and SEPTA officials have expressed concern about the quality of work done by China Railway Rolling Stock Corporation (CRRC), the government-owned car manufacturer from China
Boston’s Massachusetts Bay Transit Authority says CRRC has delivered only 90 of the 404 new cars it ordered in 2014 for $800 million. Many of them have been sidelined by problems including a battery explosion, a derailment, loose brake bolts and faulty wiring that caused an electrical current to arc and hit a nearby train.
Separately, SEPTA’s $138 million contract with the Chinese company is the subject of an audit by the federal Department of Transportation’s inspector general to ensure the transit authority is complying with a federal law which requires 70% of railcar components to be made in the United States.
A bargain too good?
CRRC, which is the world’s largest producer of railcars, entered the US market in the past decade, winning contracts in Chicago and Los Angeles, as well as SEPTA and Boston’s MBTA.
Along the way, these agreements have been embroiled in tensions between the US and the People’s Republic of China over trade and national security issues.
US officials — and rival companies — complain that CRRC’s government ownership allows it to outbid competitors for government contracts by setting artificially low prices.
SEPTA ordered 45 commuter rail cars from the company in 2017. CRRC’s price was $34 million below its closest competitor, Canadian company Bombardier, which has about 25 years of experience building rail cars in America , to zero for the Chinese company.
It was too good a deal to resist, SEPTA officials said at the time.
These days, they’re hoping Boston’s experience with CRRC isn’t a preview of upcoming attractions here.
Repeated failures
In January 2022, SEPTA was frustrated by “production delays and shortfalls” on the first two cars that CRRC was building for the agency, CEO Leslie S. Richards and board chairman Pasquale wrote “Pat” Deon, to company executives.
They cautioned that SEPTA “must consider whether and how this program will proceed” and said the transit agency would not accept any CRCC railcars with unresolved issues.
Among the problems, Richards and Deon said, were “repeated leak test failures,” faulty interior panels, wiring problems, repeated brake test failures and “unsafe emergency exit windows.”
In addition, officials expressed concern that CRRC MA, the company’s U.S. subsidiary, had not added staff at its Springfield, Mass., facility to handle final assembly of the cars ordered by SEPTA. The plant has been understaffed and chaotic during the production of the MBTA order, according to a recent Boston Globe story based on accounts from former workers.
SEPTA has the right to impose penalties on the company and can sue for damages, but “the goal is to work with CRRC to fix what’s wrong,” agency spokesman Andrew Busch said. He added that several issues, including water leaks, have been fixed, and the company has provided detailed plans to address others.
At one point last year, CRRC reworked the stairs between the lower and upper levels of SEPTA cars because the clearance was too low and many passengers would hit their heads on a panel, rail officials said. agency
The first two cars, intended as test vehicles for SEPTA, are currently in Los Angeles, after being recently shipped from Tangshan, China, where they were initially assembled and tested, the agency spokesman said. Andrew Busch. The cars were disassembled before shipping.
They will move to Springfield for assembly and then to Philadelphia, though SEPTA doesn’t know exactly when that will happen, he said.
“SEPTA inspectors will be on the ground” at the Massachusetts factory and examine the cars closely, Busch said.
For the remaining 43 cars, the stainless steel shells will come from CRRC’s plant in China and then be fully outfitted and assembled at CRRC’s Springfield MA factory, which is also building the MBTA cars.
A federal investigation
The inspector general’s audit was released Friday and was first reported by the Boston Globe. In a memo, the inspector general’s office said it was examining the Federal Transit Administration’s oversight of SEPTA’s compliance, and its certification that CRRC complies, with “Buy America” requirements for to the purchase of railway rolling stock.
Republican members of the House Transportation and Infrastructure Committee called for the inspector general to look into the contract after photos of SEPTA cars on the assembly line in China circulated on social media and were published by The Inquirer in July past
The cars in the pictures looked finished, and a spokeswoman for the reps said it “raised some flags for our members”.
Buy America requires that 70% of the components of rail cars built by a foreign-owned corporation be made in the US and that final assembly be done here. Investigators want to see how SEPTA calculates the value of foreign car components, the DOT memo said.
“SEPTA has met all of Buy America’s requirements throughout this process,” the agency said in a statement. Based on its own audit, SEPTA found the cars will exceed Buy America requirements, with 150 “unique components” made in the United States, the statement said.
“We look forward to fully cooperating with the inspector general’s audit.”
