Bombardier China Venture Wins Major New Train Orders

A China joint venture of Bombardier Corp. has won new orders from China’s rail operator for high-speed trains worth about 3.61 billion yuan ($525 million), marking one of the biggest such orders for the Canadian plane and rail equipment manufacturer.

Bombardier Sifang (Qingdao) Transportation Ltd. was one of only two companies awarded contracts to build 16-carriage cars, according to an announcement late last month on the latest purchases by China Rail Corp. (CRC), China’s national rail operator. The joint venture was also one of five winners of awards to supply CRC with smaller eight-car trains, according to a separate announcement.

Both types of trains are capable of speeds of up to 350 kilometers (217 miles) per hour, the fastest speed now operating on China’s state-of-the-art high-speed rail network, the world’s largest.

CRC did not specify the size of the orders. But a source close to the operator said the pair of orders consisted of one order for six 16-carriage trains, and one order for 15 eight-carriage trains, with a total value of about 4.64 billion yuan. The order was the joint venture’s largest since 2009.

Founded in 1998, Bombardier Sifang is a joint venture between the Canadian company and a unit of CRRC Corp. Ltd., China’s main builder of railway equipment.

China’s state-of-the-art high-speed rail network has grabbed global headlines over the last 10 years as the nation built up a 25,000-kilometer system cutting travel times by half or more. Those trains now comprise about a third of CRC’s total fleet of 73,000 carriages, in a nation that depends heavily on rail travel.

Many of the older routes not served by high-speed rail are also about to get one of their biggest speed upgrades in decades, as CRC also gets ready to roll out its first new generation of traditional, more local trains to replace the current generation that has been in service for the last quarter century. Those new trains will travel at speeds of 160 kilometers per hour, up sharply from the current 120 kilometers to 130 kilometers per hour, Caixin learned last month.

Bombardier’s latest China win also comes against the backdrop of strained ties between Beijing and Ottawa following the recent detention of a high-level Chinese telecom executive in Vancouver for possible extradition to the U.S. to face fraud charges. Following that move, two Canadians have been arrested in China in separate cases, with both suspected of activities that threatened national security.

Contact reporter Yang Ge (geyang@caixn.com)

An earlier version of this story misstated the value of the deal.