Lawmakers want CRRC on federal list of state-directed enterprises

U.S. Reps. Mike Gallagher (R-Wis.) and John Garamendi (D-Calif.) are calling on the U.S. Treasury Department  to recognize China Railway Rolling Stock Corp. (CRRC) as a threat to the U.S. economy and national security.

In an Oct. 13 letter to U.S. Treasury Secretary Janet Yellen, Gallagher and Garamendi asked that the U.S. Treasury "protect the market" from CRRC by putting it on the Treasury's list of state-owned enterprises due to the company's connection to the Chinese military.

"We are deeply concerned that CRRC will continue to undercut good-faith actors in the rail sector, further compromising the global rail market,” the letter states.

CRRC controls more than 83% of the global rail market and aims to dominate the remainder, the congressmen claimed. Since entering the Australian rail market a decade ago, CRRC has "wipe[d] out Australia’s domestic rail manufacturing entirely," they said.

"CRRC has already made anticompetitive incursions into the United States rolling stock market with state-backed financing, below-market pricing, and other anti-competitive tactics as a mainland Chinese state-owned enterprise. CRRC’s activities in Australia should serve as a blueprint of its designs for the American market," the congressmen wrote.

The company has worked with some U.S. transit agencies. For example, it has a rail-car delivery contract with the Southeastern Pennsylvania Transportation Authority. Some congressmen are asking U.S. Department of Transportation Inspector General Eric Soskin to investigate whether the contract complies with "Buy America" standards.

The Rail Security Alliance, which represents an industry of 65,000 domestic rolling stock manufacturers and suppliers, said in a press release they support the call to include CRRC on the treasury's list of state-owned enterprises.