Bloomberg Businessweek - USA (2019-10-07)

(Antfer) #1

mightdosomethinganddepriveyourselfofa high-quality, 51
low-costrailcar,oryoucansaythere’snoevidenceand
thenlooklikea dupe.”


J

ohnScavottoJr.,businessmanagerofSheetMetal
WorkersLocal63,whichrepresentssomeworkers
atCRRC’sSpringfieldplant, 90 mileswestofBoston,
saysit’sfrustratingthatCRRChasn’tgottenmore
creditforpayingAmericansgoodunionwages.“Beforethis
plantwashere,thiswasa big,emptylot,”hesays.“CRRCis
offeringSpringfielda lifeline.It’sa placewhereyouknow
you’regoingtogoeverydayandwalkoutin 20 yearswith
a pension.There’ssecurity.”
Scavottosayshegets“woundup”attalkofCRRCbuild-
ingspytrains,becausehismembersworryit couldcost
themtheirjobs.“Arewereallysayingtoourselvesthatthe
Chinesearesmarterthanus?”hesays.“Ifit isn’tCRRC,
who’sit gonnabe?ThereisnoAmericanrailcarmanu-
facturer.WelettheGermanscomeinhere,SouthKorea,
France—they’reallforeigners.”
CRRC’scriticssaytheChicagoandSpringfieldfactories
employfar fewerworkersthanwould berequired to
manufactureentirerailcars—hencetherelativequietin
thetwofacilities.Thecompanyshipsprefabricatedtrain
shellstotheU.S.,whereworkersfitthemoutwithnecessary
equipment.OfficialsattheChicagoandSpringfieldplants
saytheysatisfyBuyAmericanrules,whichrequire70%
U.S.content. The recent Congressional Research Service
study concurs.
“Do we have an advantage in building shells in China?


Absolutely,”saysSpringfieldfacilitydirectorVinceConti,
a 30-yearrailcarindustryveteranwhopreviouslyworked
forBombardierinChinaandIndiaandelsewhere.“Itfeels
likewe’re being targeted because we’re a Chinese company.”
Well,yes.Thequestionis whethertheconcernssurround-
ingCRRCarelegitimate.TheRailSecurityAlliancehasspent
$2million on lobbying, most of it going to Olson’s firm, Venn
Strategies, according to OpenSecrets.org. The two U.S. CRRC
factories, which have retained lobbyists only in the past year
or so, have spent at least $160,000. The Massachusetts factory
recently launched a website that seeks to counter anti-CRRC
claims, boasting that the plant uses parts sourced from New
Jersey, South Carolina, Wisconsin, and other states. The site
also links to Wall Street Journal and Boston Globe editorials
casting trains as no more of a spying threat than ubiquitous
Chinese-made smartphones.
Noneofthisislikelytostaveoffthelegislation,which
thistimeispartofa defensespendingbill.Assumingthat
it becomeslaw,CRRCwouldbeallowedtofulfillitscurrent
contracts,allofwhichinvolvefederalfundsexceptthe
onewith Boston. Any transit authorities that sign a con-
tract with CRRC in the future would have to do without
federal dollars.
That could change the calculations considerably. CRRC’s
spokeswoman in Springfield, Lydia Rivera, says the legisla-
tion would eventually force the factory to close. Smolensky,
the spokesman in Chicago, won’t go that far. He says CRRC
will continue to educate policymakers about the “unintended
consequences” of the legislation: lost jobs and higher prices
for rail cars. <BW> �With Chunying Zhang
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