China may have edge in race to build California's bullet train

A CRH train that runs on Lanzhou-Urumqi High-Speed Railway stops at Urumqi South Railway Station in Urumqi, Xinjiang Uygur autonomous region, Dec 26, 2014. [Photo/Xinhua]

Chinese state firms are poised to be strong contenders in the race to make high-speed trains that will sprint between Los Angeles and San Francisco, part of a $68 billion project to bring the service to the United States for the first time.

While "bullet train" manufacturers from Germany, Japan, South Korea, and France are expected to be among those jockeying for the estimated $1 billion train contract, China's ability to offer low prices and hefty financing appear to make it the one to beat, say lobbyists and industry insiders.

Lacking experience in the technology, California must turn to foreign firms to build the trains – albeit domestically and with American workers - setting off a geopolitical race to grab a foothold in the nascent US high-speed rail industry.

Germany's Siemens is expanding its rail factory in Sacramento to incorporate a "high-speed lot" Japan has voiced its interest, boasting a record of no fatal accidents in over 50 years operating high-speed trains. France's Alstom, which produces rail cars in upstate New York, is also a potential contender.

Awarding a piece of America's most ambitious and expensive infrastructure project in decades to strategic rival China – over a long-term ally such as Japan - would be prone to political controversy.

But a Chinese bid with generous financing attached could prove hard to resist for California's government, which has so far secured only a fraction of the total funding needed for a project that would see trains speeding at over 200 mph (322 kph) to connect the state's biggest cities in under three hours.

"They are the 900-pound guerilla," said Rod Diridon, former board chairman of the California High-Speed Rail Authority (CHSRA), the state government agency tasked with issuing the bid and selecting a manufacturer. "They have huge advantages, because they have so much funding."

After building the world's longest high-speed train network in less than a decade, China has made exports of the technology a priority, pushing to build thousands of kilometers of track in countries such as Turkey, Saudi Arabia and Venezuela.

State-owned locomotive makers China CSR Corp and China CNR Corp last December announced plans to merge in a $32 billion deal, creating a formidable global competitor backed by generous public financing.

CNR Tangshan Railway, a unit of CNR, and CSR last October made an official expression of interest in supplying the trains to California, and are now expected to launch a joint bid.

Siemens, Alstom, Japan's Kawasaki Heavy, South Korea's Hyundai Rotem, Italy's AnsaldoBreda, Spain's Talgo, and Canada's Bombardier also expressed interest.

China CNR and China CSR declined to comment when asked about their interest.