Massachusetts Bay Transportation Authority (MBTA) officials were recently notified that CRRC (China Railway Rolling Stock Corp.) will not be able to deliver the remaining Orange and Red Line railcars by December 2023 and September 2026, respectively, and could face “daily fines of $500 for each late car,” according to a Boston Herald report.
The current timeline, according to the Boston Herald report, “already puts CRRC nearly two years behind schedule for the Orange Line and three years behind schedule for the Red Line, based on the respective dates set in the initial contract: January 2022 and September 2023.”
“Right now, we feel pretty strongly here at the MBTA, and CRRC acknowledges that they will not be able to meet this production schedule,” the Boston Herald reported Interim MBTA General Manager Jeffrey Gonneville as stating, adding that he expects CRRC “to provide an updated delivery schedule in late February, and resume delivery that same month … They’re in the process right now of working through what we refer to as, kind of an updated and realistic and achievable schedule.”
According to the Boston Herald report, Gonneville said the MBTA’s project team “‘feels strongly’ that CRRC won’t be able to meet its contractual obligation to deliver eight cars per month, ‘without significant changes in production throughout’ at its Springfield facility, where the new cars are being assembled.” “Four cars is more likely,” Gonneville added.
According to the Boston Herald report, only 78 of new Orange Line cars out of 152 and 12 of 404 Red Line cars have been delivered, shipments having been suspended in July 2022 to address “manufacturing-related issues” identified by the MBTA, Gonneville said.
In November, due to what the CRRC described to the MBTA as a “surplus of car shells (26 Orange and 14 Red)”, currently stored at the Springfield facility, production on the Red Line car shell production was halted in November, according to the Boston Herald report. All 152 Orange Line car shells have been produced, 78 of which are being stored and waiting to enter production at the Wellington car house.
According to the Boston Herald report, Gonneville said CRRC has “taken the position that its focus is on Orange Line car production, but the MBTA has asked for better balance when the company provides its revised schedule,” recommending that the T “take a step back and take ‘a fresh look’ at the current contract to begin evaluating how different strategies can be used to ensure the delivery of safe and reliable Orange and Red Line cars ‘as quickly as possible.’”
The MBTA awarded CRRC a contract for new Red and Orange Line car production in 2014. The initial contract was for $565.18 million; the MBTA ordered an additional 120 new Red Line cars in January 2017, bringing the current value, along with a change order, to an approximate $870.5 million, according to the Boston Herald report.
Since that time, the Boston Herald reported, “there has been a myriad of issues with production, and new cars put into service have been pulled several times due to a battery explosion, braking problems, and most recently, ill-fitting materials that led to a power cable failure in nine new Orange Line cars.”
In late December 2022, the MBTA wrote a letter to CRRC “describing the company’s failure to produce quality trains, meet delivery deadlines and respond to concerns raised by the T.”
CRRC MA Project Director Xianyi Jiang in a Jan. 5 response to the letter, obtained by the Boston Herald, said the company remains “committed to delivering these vehicles with safety performance top priority and reaching mutually agreed-upon acceptance.”
“As we have discussed, the extreme political environment worldwide and global pandemic over the years has brought difficulties to the project and multiple challenges to the successful production and delivery of these vehicles at the Springfield facility,” Jiang wrote.
According to the Boston Herald report, Gonneville “acknowledged that certain global factors,” including the National Defense Authorization Act of 2019 banning mass transit agencies from using federal funds to purchase railcars and buses from Chinese-owned companies; and the U.S.’s increasing of tariffs on Chinese goods by 25% in 2018, “were out of the company’s control.”
According to the Boston Herald report, the increased tariffs on Chinese goods “resulted in $18 million in incurred costs, a number it expects to increase to roughly $35 million throughout the course of this contract.”
CRRC has requested relief from the T on these charges, Gonneville said, adding that “inflation, low employment and vehicle delivery delays strained relationships between CRRC and its suppliers.”
Gonneville, according to a MassLive.com report, also stated that the long-term future of CRRC’s $80 million Springfield plant in uncertain as the 2019 federal law blocks the company from accessing federal money in most cases.
According to the MassLive.com report, CRRC can only “solicit federally-funded business from transit agencies with which it is already doing business,” including the T, the Los Angeles Metro and the Southeastern Pennsylvania Transportation Authority (SEPTA).
“Essentially, CRRC is limited in future work they can do,” Gonneville said, according to MassLive.com. “There is no further work at the Springfield factory after completion of the current MBTA contracts.”
According to the MassLive.com report, “the SEPTA project is delayed but still moving forward; the deal with Los Angeles is still alive; and a separate arm of CRRC has a deal to build cars for Chicago, but at a separate facility.”
The CRRC plant, built on the former site of the Westinghouse Electric Corp. factory, has approximately 250 union employees, including electricians and metalworkers, and CRRC’s critics have said the factory “could be repurposed by another railcar maker,” according to the MassLive.com report.
Gonneville’s future at the MBTA also remains uncertain as Gov. Maura T. Healey recently stated, according to the MassLive.com report, that hiring a new GM is a “weeks, not months, scenario.” In December 2022, Gov. Healey’s transition team retained Krauthamer & Associates to “run a wide search for the next head of the T.”