Republicans Spur Investigation into China-Owned Corporation Given Billions in U.S. Tax Dollars to Build Rail Cars

People take a train with 7000-series railcars during an in-service test run in Chicago, th
Xinhua/Joel Lerner via Getty Images

The China Railway Rolling Stock Corporation (CRRC) is now being investigated by the Department of Transportation (DOT) Inspector General (IG) after the China-owned company has raked in billions in American taxpayer money, producing rail cars for a number of cities in the United States.

The CRRC, owned by the government of China, was initially awarded a $138 million contract with the city of Philadelphia, Pennsylvania, to build at least 45 new rail cars.

Already, the contract has been marked with delays and production issues like “‘repeated failures of water-tightness tests,’ faulty interior panels, wiring issues, repeated brake test failures, and ‘unsafe emergency exit windows,'” according to the Philadelphia Inquirer.

Last year, Reps. Sam Graves (R-MO), Rodney Davis (R-IL), and Rick Crawford (R-AR) asked the DOT IG to investigate whether CRRC was adhering to Buy American rules, which require the corporation to source at least 70 percent of rail car components from manufacturers in the U.S.

The letter stated:

We are concerned whether CRRC MA has met the Buy America requirements over the course of this contract so far and whether CRRC MA will be able to meet these requirements as the contract progresses. Accordingly, we request that the DOT IG initiate a review… [Emphasis added]

In response, DOT IG has announced a probe into whether the Federal Transit Administration (FTA) is properly overseeing CRRC and the Southeastern Pennsylvania Transportation Authority’s (SEPTA) adherence to Buy American rules.

“… [O]ur objective for this audit is to assess FTA’s oversight of SEPTA’s compliance with Buy America standards for its rolling stock contract with CRRC MA,” DOT IG officials wrote in a memo:

Specifically, we will examine FTA’s oversight of SEPTA’s certification of CRRC MA’s adherence to FTA’s Buy America requirements for rolling stock and SEPTA’s calculation of the total value of foreign components for the purpose of determining compliance with FTA’s Buy America rolling stock requirements. [Emphasis added]

Chinese media outlets have previously suggested that CRRC has scored billions in American taxpayer money through contracts with cities like Philadelphia; Boston, Massachusetts; and Chicago, Illinois, to produce passenger rail cars.

Effectively, American tax dollars have helped line the pockets of Chinese Communist Party (CCP) members who control the country’s government and subsidize CRRC production costs. At risk are thousands of American jobs and the nation’s supply chain.

In 2019, researchers at Oxford Economics found that for every $1 billion given to a China-owned corporation to build rail cars, some 3,250 to 5,100 American jobs are lost. In other terms, every American job created as a result of a city or state contract with a Chinese firm ultimately costs 3.5 to 5.4 additional American jobs.

John Binder is a reporter for Breitbart News. Email him at Follow him on Twitter here.


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