Massachusetts awards $566 million subway car contract to Chinese rail company

Industrials Associated Press

A Chinese government-owned rail company was awarded a $566.6 million Massachusetts state contract on Wednesday to build subway trains for the "T," the nation's oldest subway system, despite concerns from local activists about China's human rights record as well as complaints from competitors that the company's winning bid was unrealistically low.

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The Massachusetts Department of Transportation's board of directors voted unanimously to approve a contract with CNR MA Corporation to build 284 new subway cars. The new cars are needed to replace the Massachusetts Bay Transportation Authority's 32-year-old Orange Line trains and the 44-year-old Red Line cars that serve the Greater Boston area.

CNR MA is a joint venture of China Changchun Railway Vehicles and China CNR Corporation Limited, a Chinese government-owned enterprise that is the world's largest rail car maker. The project would be its first in North America.

At a Wednesday public hearing, Chai Ling, a Massachusetts resident who played a prominent role in the 1989 Tiananmen Square student movement, said the contract award would put a "blood-stained record" on the state, citing the "tyranny" of China's government. "Please do not stand on the wrong side of history," she said.

Xiwei Lu, president of the CNR MA, said later that his company abides by all labor laws and provides wages "two or three times" the average pay in China. "We care about our employees," he said, inviting reporters to visit the company's facilities in China. "They are the real creators of value for our company."

On complaints from competitors, Lu said the company is committed to establishing a foothold in the U.S. and its bid and proposed new manufacturing facility was a reflection of that. "We want to be in this market," he said.

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An MBTA spokesman said the agency's review found no human rights violations by China CNR Corporation Limited. The contract calls for at least 60 percent of the work to take place in the U.S. and for the company to offer Massachusetts workers salary and benefits at least comparable to the region, officials said Wednesday.

CNR MA has pledged to build the subway cars at a new, $60 million factory in Springfield that would become its U.S. headquarters. The 150,000-square-foot facility, proposed on the 40-acre former Westinghouse Electric plant site, is expected to create over 250 new manufacturing and construction jobs for the western Massachusetts region.

The rail cars, the first of which will be delivered in 2018, are expected to help increase the subway system's capacity and decrease passenger wait times. The MBTA says the total Red Line and Orange Line improvement budget is about $1.3 billion and calls for upgrades to the system's rail car maintenance and storage facilities.