China Poised To Cash In On Coronavirus Aid Designated For U.S. Railroads, Safety Advocates Warn

AP Photo/Nam Y. Huh

China’s communist government is poised to cash in on billions of dollars in federal coronavirus aid designated for U.S. railway systems, warn railroad safety advocates.

Erik Olson, vice president of the Rail Security Alliance, said more than $2.6 billion in contracts has already gone to the Beijing-backed China Railway Rolling Stock Corporation in the past four years.

Because CRRC benefits from financial support from the Chinese Communist Party, the company often can significantly underbid competitors, said Mr. Olson.

“They are moving into this market. They are trying to take it over,” he said. “Any funding is supposed to be kept here in the United States to keep people employed. We fundamentally believe taxpayer dollars need to be staying in the United States.”

The Federal Transit Administration has $22.7 billion to shell out for urban and $2.2 billion for rural rail systems through the CARES Act, the massive coronavirus economic relief package that was approved in March.

The funds are intended to offset operation costs amid decreased ridership and decreased revenue for transit systems due to the coronavirus crisis.

The money can also go toward protective equipment and capital improvements.

Some of that money could go to CRRC for passenger rail cars, though many of the contracts have not yet been awarded.

China cemented its dominant position in railroads by merging two of its largest rail rolling stock corporations to create CRRC, which now controls 83% of the global rail market.

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