May 12, 2012

China presses ahead with domestic high speed rail and exports of high speed rail equipment

1. China will continue with research and development into its new generation high-speed trains despite the industry's tarnished image due to a spate of operation faults last year, according to a plan for the country's rail traffic equipment manufacturing industry.

The new generation trains will run at speeds of more than 300 km an hour, according to the five-year plan for the industry for the 2011-2015 period, which was released by the Ministry of Industry and Information Technology on Monday.

On July 23 last year, a high-speed train slammed into a stalled train near the eastern city of Wenzhou, leaving 40 people dead and 172 injured. The incident was blamed on faulty signaling equipment.

Construction of high-speed trains and railways cooled sharply after the State Council, or China's cabinet, ordered slower operational speeds in the wake of the crash.

Trains with a maximum speed of 350 km per hour (kph) were ordered to run no faster than 300 kph, while those with a maximum speed of 250 kph had to run at no more than 200 kph.

Some analysts then predicted the accident would hamper the nation's exports of high-speed train technologies.

But contrary to these concerns, China has continued to export a wide range of equipment including electric multiple units, urban rail vehicles, steam locomotives, large road maintenance equipment to many countries such as Russia, Australia, Brazil, India, Argentina, Turkey, Iran and Malaysia.




China rail traffic will boom in coming five to 10 years with a large demand for various equipments. It estimates that the nation will consume more than 1,000 electric multiple units and about 5,000 locomotives from 2011 to 2015.

global rail traffic equipment market will grow by 3 percent on average each year by 2015, with an annual demand averaging more than 100 billion euros ($130 billion), the plan says, citing forecasts of the Association of the European Rail Industry.

In the five-year plan, the ministry predicted that the industry's annual sales value will exceed 400 billion yuan ($63 billion) every year and investment by backbone enterprises in research and development will exceed 5 percent of their annual sales by 2015.

By 2020, the industry's annual sales value would exceed 650 billion yuan (US$105 billion) and investment in research and development would exceed 6 percent of annual sales, it said.

2. The Shanghai Railway Bureau on Monday announced through its Sina Weibo micro blog that business class tickets on high-speed trains on the Shanghai-Nanjing and Shanghai-Hangzhou lines will be reduced by 30 percent between May 18 and June 20.

Tickets for premium seats on the two lines over the same period will be cut by 10 percent.

That means a business class ticket from Shanghai to Nanjing, roughly priced at 438 yuan ($70), will now be available for 307 yuan. A premium seat on the same route costs 263 yuan, and the discounted price will be 237 yuan.

Business class and premium seats account for 2 percent of a high-speed train's total capacity.


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