Harmony and Ambition China's Cut-Throat Railway Revolution
China is spending mountains of money to expand its country's high-speed railway network and manufacture the world's fastest trains. But do its ambitions in the railway sector justify how these goals are being pursued -- and the risks they might ultimately pose?
With their elegant, white-and-blue exteriors, the super-high-speed trains lined up on the factory floor glitter like a school of barracudas. The opened front panels of the locomotives gape like hungry jaws as technicians in beige uniforms tend to what's inside.
Deputy chief engineer Lu Renyuan, 48, smiles proudly. These newly assembled bullet trains will soon leave the China South Locomotive & Rolling Stock (CSR) factory here in the northeastern Chinese city of Qingdao to race along new high-speed tracks at speeds of up to 350 kph (217 mph) -- in other words, faster than any other train line in the world. Similar trains already race back and forth between such major cities as Wuhan and Guangzhou, shortening the travel time between them from 11 hours to three.
These trains and their railways are only one step along the way in China's ongoing and ambitious race to catch up with its competitors. By focusing on incorporating foreign rail technology since 2004, the country has grown to become the most serious competitor to companies -- such as the German engineering giant Siemens -- that used to run laps around it when it came to such technologies.
At the moment, Western companies are still proudly showcasing their technology at the 2010 World Expo that just opened in Shanghai. They're still hoping for more contracts worth billions. And, as Siemens did at the expo's opening, they're still giving polite public thanks for being considered "an integral part of the Chinese economy."
Even so, CSR is simultaneously busy at work developing its own trains that can travel 380 kph (236 mph). The plan is for these new super-speedy trains to shorten the 1,300-kilometer (800-mile) stretch between Beijing and Shanghai from roughly 10 to just four hours by 2011.
When Clients Become Competitors
More than anything, the expansion of China's railway network has taught its competitors a lot about its sophistication and desire to expand. The one-time client has now become a competitor. And this is no where more evident that in the railway sector.
The new challenger to Germany's ICE, France's TGV and Japan's Shinkansen is called "Hexie." The word means "harmony" -- in a respectful bow toward President Hu Jintao and his constantly evoked idea of fostering a "harmonious society."
Beijing wants to use its new high-speed trains to bring the various parts of China's vast territory closer together. By 2020, its new rail network is set to increase in size from around 6,500 kilometers (4,000 miles) to 18,000 kilometers (11,000 miles). A web of high-speed train lines will connect the most important cities -- from north to south and east to west. In a later phase, planners even want to expand on a global scale, toward Southeast Asia and the West, even as far as London. And, of course, they want to use Chinese high-speed train technology in the process.
Until only recently, if you had told Western experts that China would evolve into a global technology leader, they most likely would have laughed. But now it's the Chinese who are laughing. Whether in Venezuela, Malaysia or Indonesia, their homeland has started aggressively bringing its own high-speed trains onto the export market. And, in doing so, it ruthlessly exploits the cutting-edge technology so recently imported into the country from the West.
In the US, for example, China hopes to win billions in contracts to help President Barack Obama upgrade his country's run-down rail network as part of his economic stimulus package. And, in Saudi Arabia, Siemens recently declined to go up against Chinese companies manufacturing much less expensive railways. Instead, the Munich-based company will merely bid on the high-speed line planned between Mecca and Medina as part of a Chinese-led consortium.
Unite, Divide and Conquer
Lu, the engineer, casts a sweeping glance across the factory work floor. Screws are neatly and carefully sorted by size in colorful plastic boxes, and not a speck of dust mars the perfect shine of the gray floors. Here in Lu's factory, everything has to be perfect -- because there's much more at stake for China than just high-speed trains.
Indeed, in a national tour de force, planners in the Communist Party and the Ministry of Railways have succeeded in doing what they also hope to achieve over the long term with automobiles, airplanes and other high-tech industries. When it comes to rail technologies, the plan was simple: By using both the political bait of forming joint ventures and deft negotiating tactics, China attracted leading Western engineering companies to China -- such as Siemens from Germany, Alstom from France, Bombardier from Canada and Kawasaki from Japan. Once it had these foreign companies where it wanted them, it played them off against each other so that they would relinquish key pieces of technological know-how at a low price.
The exteriors of the Chinese trains easily betray their genetic heritage. The trains here in Qingdao, for example, bear a striking resemblance to Japan's Shinkansen trains. In Tangshan, a few hundred kilometers further northwest, a competitor called China Northern Rail got most of its technology from Siemens --and you can hardly tell the difference between its Hexie trains and Germany's ICEs.
- Part 1: China's Cut-Throat Railway Revolution
- Part 2: 'Independent Innovation'