Why US, China railway industries want collaboration fast-tracked

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Why US, China railway industries want collaboration fast-tracked

Rail-transport companies from China and the US remain committed to strengthening cooperation - including on projects in third-country markets - even as a trade rivalry between the two largest economies chugs along.

With the US being a long-time leader in freight rail and urban transit, and China having emerged as a global powerhouse in high-speed rail, the two sides could deepen cooperation in the rail-transport sector, said Everett Wakai, minister counsellor for commercial affairs at the US embassy in Beijing.

He spoke during the US-China Rail Transit Industry Roundtable on Friday at the China International Supply Chain Expo. Representatives from some US companies with ties to the rail sector were there. A key talking point was the potential for supply-chain cooperation.

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Guan Jiaxin, vice-president of China Civil Engineering Construction Corporation, said the state-owned giant cooperates extensively with US companies when it comes to equipment.

"Major projects and markets led by our company are widely using construction machinery from Caterpillar and generators from Cummins," Guan said during the round-table chat. Caterpillar and Cummins were two of the American firms in attendance.

"We look forward to exploring more cooperation opportunities with the US in overseas projects investment, building and operating, such as joint financing, design and consulting ... in markets where US firms have a strong presence, such as Latin America, the Middle East, Africa and Europe," he said.

For years, American makers of rail equipment have supplied China's rail projects, both within the country and overseas - mainly those involved in the Belt and Road Initiative, including urban rail transit systems such as metros and conventional railway projects, company representatives said at the event.

Cui Yao, president of Wabtec (China), said revenue has grown in the past two decades from almost zero to an average of US$500 million per year, with US$300 million from sales in the Chinese market and US$200 million from products manufactured in China and exported to overseas markets. He described this as a "huge success".

Wabtec's local suppliers also benefit from the company's - the US company, based in Pennsylvania, purchases US$400 million worth of goods annually from Chinese suppliers, and it expects this year to be no different.

On the sidelines of the event, another US company representative said: "Our business is not impacted by the tariff, as supplies to China's projects in third countries are not subject to the US-China tariffs."

Speaking on condition of anonymity to comply with corporate policy, he added that supplies to China's local projects had also not yet been interrupted, thanks to the company's high level of localisation, including the establishment of numerous joint ventures with state-owned enterprises in China.

But he cautioned that even as Chinese rail-equipment manufacturers may find some opportunities in the US metro market, they would face virtually no openings in the railway sector, as it is dominated by local players.

On Wednesday, the US government announced the termination of US$4 billion in federal funding for a high-speed rail project in California, citing an "inability to complete" the goals it set out to achieve. The long-delayed project, which began in 2009, aimed to build a train capable of travelling between Los Angeles and San Francisco in under three hours.

State officials said the "illegal" move would be challenged.

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This article originally appeared on the South China Morning Post (www.scmp.com), the leading news media reporting on China and Asia.

Copyright (c) 2025. South China Morning Post Publishers Ltd. All rights reserved.



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