Wednesday, July 6, 2011

China's newest high-speed train highlights China's high-speed rail problems

One more time. Pay attention to China, the country we envy so much because they have zillions of miles of high-speed rail. We are so eager to emulate them.  Therefore, it certainly behooves us to watch closely what's going on there.

Here's an NPR interview about the new Beijing to Shanghai High-Speed Train.  We've discussed China's turbulent HSR history already.  We noted that the major thrust for China and its huge over-investment in HSR is seeking world prestige. They are obsessed with demonstrating their technological superiority even though most of the HSR technology they now take credit for was "borrowed" from German and Japanese technologies which they imported.  Germany (Siemens) in particular has mounted numerous lawsuits about China's illegal appropriation of patented technologies.

It's important for us to note the downside to China's presumed success.  Corruption appeared first on the scene. That was followed by discovering of faulty construction practices and serious safety issues.  Too much; too fast, with predictable results.

Now we discover that most of their HSR trains run nearly empty.  The ticket costs are far too expensive for all but the more affluent new upper middle classes and the higher levels of the Chinese bureaucracy.  Worse, they can't afford those super top speeds. They consume too much energy and the maintenance costs are too high. Now they are running their top speed trains at lower, and less expensive speeds.  

In at least one case, they had to remove all the luxurious interior fittings from a number of train-sets, and replace them with more mundane and pedestrian quality.  They also had to reduce their ticket costs, which of course, severely reduced their farebox revenues and increased the size of their debt service. 

China's trains are everything that the HSR critics in the US have predicted.  So, we need to ask our Democratic colleagues, do they still want such a rail system when we can definitively predict its financial outcomes and adverse impacts?  Huge debts, few riders, endless costs, only for the affluent, and far far more expensive to build than advertised. 

Most of their problems that appear in English language Chinese papers play down all the adverse unfolding of problems, but we see wide coverage in the world press and what we can learn ought to be cautionary for us in the US with both our China-envy and our HSR ambitions.  

Despite having considered, at one time or another, the development of HSR in the US, we still have a great deal to learn about its relevance and applicability here.  However, since this issue has become so intensely politicized, we have far less opportunity to grasp all the adverse consequences that such massive expenditures will generate with the construction of a level of luxury train that we don't need.  If, indeed, there had been a market for such travel, private investors would have pursued this opportunity a long time ago.

I'm not qualified to comment on China's need for high-speed rail, although I have my doubts and would have thought that a network of regular but still fairly fast trains, at far lower cost to build, operate and ride on would have served their purposes better.  They of course, have over-reached to prove to the world their superior status so quickly arrived at. 

We, in California, on the other hand, are not China.  It is far more demonstrably clear that we do not need a high-speed rail.   And we know that our project is being pressed upon us for political reasons only; not transportation reasons, which California has yet to spell out.

No Smooth Ride: Building A High-Speed Rail In China

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All Things Considered

June 27, 2011
In China, the government gave journalists an early look Monday at a new high-speed rail line. It cuts the travel time between Beijing and Shanghai in half. The line will be formally unveiled later this week to coincide with the ruling Communist Party's 90th anniversary. While the project's construction was remarkably fast, it was by no means smooth.

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To China now, where the government gave journalists an early look today at a new high-speed rail line. It cuts the travel time between Beijing and Shanghai in half. The line will be formally unveiled later this week to coincide with the ruling Communist Party's 90th anniversary. While the project's construction was remarkably fast, it was by no means smooth.

As NPR's Louisa Lim reports, the effort has been dogged by allegations of corruption and fears that it will never be able to pay for itself.

LOUISA LIM: This was the inaugural press run of China's Beijing to Shanghai high-speed rail. This train line is not just a technological achievement; it's also being touted as a political one too. The chief engineer of China's railways, He Huawu, was on the platform. And he's been saying the timing of this launch is no coincidence.

Mr. HE HUAWU (Chief Engineer, Chinese Railway Ministry): (Through Translator) This is China's pride. We built this railway in 39 months. Such a high-standard railroad is a gift for the 90th 
LIM: In this showcase project, nothing has been left to chance. Even the beaming train attendants are uniformly cute. Gao Dan is the chief train conductor. I ask her if it's true the attendants are picked for their looks.

(Soundbite of laughter)

Ms. GAO DAN: (Foreign language spoken)

LIM: She giggles, and thanks me, blushing. You'll see that all the train attendants are very beautiful, she assures me.

(Soundbite of an alarm)

LIM: Then the train door shuts and the train glides off almost silently.

Unidentified Woman: Ladies and gentlemen, welcome to the Beijing...

LIM: The cheapest ticket on this bullet train will cost $60, and it travels at a top speed of 186 miles per hour. Critics say the tickets are too expensive, and the poor will suffer.

I'm now sitting by the drivers' cabin, which is separated from the rest of the train by a clear glass window. Now, this trip, from Beijing to Shanghai, is about 820 miles, and it takes four hours and 48 minutes. To put that in context, it's slightly further than the distance from Washington, D.C. to Chicago, which on the U.S. train system takes 16 hours and 40 minutes.

(Soundbite of conversations)

LIM: This train line cost $32 billion and was finished a year ahead of schedule. But how much of the technology is actually Chinese? I asked Zhao Guotang, deputy GM of the Beijing-Shanghai High Speed Railway Company.

Mr. ZHAO GUOTANG (Deputy General Manager, Beijing-Shanghai High Speed Railway Company): (Through Translator) Everything under our wheels is Chinese technology: the rails, the bridges, the tunneling. And the control system, the software is programmed by us. So I can say we've grasped the technology of building high-speed rail.

LIM: However, this project was plagued with corruption, with railways minister Liu Zhijun sacked for disciplinary violations, amid rumors about numerous mistresses.

During the construction of this track, $121 million disappeared. Then there's the debt problem. The debt-to-asset ratio is almost 60 percent, and some believe the money from fares will never be enough to repay those loans.

Professor ZHAO JIAN (School of Economics and Management, Jiaotong University): I think the debt crisis of Ministry of Railways is very serious in China. It's more serious than the subprime crisis in America.

LIM: Railway expert Zhao Jian at Beijing Jiaotong University. He gives the example of one particular line, from Zhengzhou to Xi'an. Built to run 160 pairs of trains a day, it currently only operates 12 pairs.

Prof. JIAN: Operating a railway is similar to operating a restaurant. It's just that restaurant has about 160 floors. But at present, only 12 floors are in operation. The others are empty. So this kind of restaurant will face very big problem of a debt crisis.

LIM: We've now arrived in Shanghai, and it's been an incredibly smooth and pleasant journey. In many ways, this high-speed rail project sums up what's good and what's bad about modern China. It's undoubtedly a technological feat building such a huge spiderweb of high-speed rail lines across so much of the country in so short a time. But it's saddling the government with massive debts. It may never pay its own way and it's permeated by high-level corruption. It's breathtaking in its achievement, but it's also flawed.

Louisa Lim, NPR News, Shanghai.

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