CRRC

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CRRC Corp., Ltd.
TypeState-owned enterprise; public company
SSE: 601766(A share)
SEHK1766(H share)
IndustryManufacturing
Predecessor
Founded1 June 2015[1]
FounderCRRC Group
Headquarters,
China
Area served
  • China
  • exported worldwide
Key people
Liu Hualong(chairman of the board, party secretary)[2]
Xi Guohua(vice-chairman, deputy party secretary, president)[2][3]
Sun Yongcai(executive director, vice-president)[3][4]
Xu Zongxiang(executive director)[4]

Wan Jun(chairman of the supervisory board, deputy party secretary)
Zhan Yanjing(CFO & vice-president)
Wang Jun(vice-president)
Lou Qiliang(vice-president)
Yu Weiping(vice-president)[5]
Products
RevenueIncrease CN¥214.521 billion (2018)
46,062,360,000 renminbi (2018) Edit this on Wikidata
Increase CN¥012.998 billion (2018)
Total assetsDecrease CN¥357,523 billion (2018)
Total equityIncrease CN¥149.684 billion (2018)
Owner
CRRC Group(55.91%)[3]:85
CSF(02.87%)[3]:83
Central Huijin(01.12%)[3]:83
general public(40.10%)
Number of employees
183,061 (2016[3]:60)
Parent
CRRC Group(direct)
The SASAC(intermediate)
The State Council(ultimate)
Chinese name
Simplified Chinese中国中车股份有限公司
Traditional Chinese中國中車股份有限公司
CRRC
Simplified Chinese中国中车
Traditional Chinese中國中車
Websitecrrcgc.cc
Footnotes / references
in consolidated financial statement, in IFRS[3]

CRRC Corporation Limited (known as CRRC) is a Chinese state-owned and publicly traded rolling stock manufacturer. It is the world's largest rolling stock manufacturer in terms of revenue, eclipsing its major competitors of Alstom and Siemens.[6][7][8]

It was formed on 1 June 2015 through the merger of CNR and CSR. As of 2016 it had 183,061 employees.[3] The parent company is CRRC Group, a state-owned enterprise supervised by the State-owned Assets Supervision and Administration Commission of the State Council. The State Council also owned additional shares via China Securities Finance and Central Huijin Investment.

History[edit]

CNR Group and CSR Group, were once one company, China National Railway Locomotive & Rolling Stock Industry Corporation [zh] (LORIC). The company was split up in 2002.[9][10]

In late 2014, CNR Group and CSR Group agreed to merge, subject to approval by the Chinese state. Under the agreement, CNR Group would formally acquire CSR Group (but CSR Corporation Limited would acquired China CNR Corporation Limited), and the combined business would be renamed CRRC Group and CRRC Corporation Limited respectively.[11][12] The rationales given for the merger were increased efficiency, and the ability to better compete internationally.[13]

The merger came into effect 1 June 2015, with each CNR share exchanged for 1.1 CSR shares - the combined company became the largest railway rolling stock manufacturer in the world, and held over 90% of the Chinese market. Total employment of the combine was 175,700 persons, and the share capital was valued at CN¥27.289 billion.[1]

After the re-merger, CRRC started expanding overseas; after being awarded a 284 vehicle order (later expanded to 404 vehicles) for metro cars for Massachusetts Bay Transportation Authority's Red and Orange lines with a US$556.6 million bid in October 2014, the company started constructing a 13,900 square metres (150,000 sq ft) assembly plant in Springfield, Massachusetts, at a former Westinghouse plant[14] beginning in September 2015.[15] Manufacturing work began in April 2018.[16]

In mid-2015, production began at a rolling stock plant in Batu Gajah, Perak, Malaysia, a satellite of CRRC Zhuzhou Locomotive, and the corporation's first plant outside China.[17] Additionally the former CSR had acquired Emprendimientos Ferroviarios in Argentina in 2014 and announced in 2016 that it would begin maintenance and production of new rolling stock for export in the country.[18][19] Argentina had previously purchased a variety of rolling stock from the company over the years, including 704 EMU cars, 81 DMU cars, 44 passenger locomotives, 360 carriages, 107 freight locomotives and 3,500 freight cars, in addition to the 150 200 Series cars for the Subte.[20][19][21] In 2017, the Argentine government purchased an additional 200 EMUs from CRRC.[22]

In mid-2015, CRRC formed a freight wagon joint venture, Vertex Railcar, as a minority partner with Hong Kong-based private equity firm Majestic Legend Holdings to establish production in Wilmington, North Carolina at a former Terex facility.[23] CRRC provided railcar designs and some components, and Majestic Legend invested US$6 million;[24] the plant was operational by the beginning of 2016.[25] In August 2016, at the request of a letter from 55 US House of Representatives members alleging that Vertex was being unfairly subsidized by the Chinese government, the United States Department of the Treasury began an investigation into whether the Chinese investment in Vertex constituted a national security risk.[26] 42 US Senators sent a similar letter in September, conveying concerns about the state-owned enterprises behind Vertex.[27] The Treasury Department released its report in December and found that the joint ownership was not a risk.[26]

In late 2015, Yu Weiping, one of the vice-president of the company, stated the company planned to double overseas sales over five years, with North American passenger rail being one target.[28] Interim six month financial results for the new company showed an increase in overseas revenue of over 60%. Half year revenue was CN¥91.8 billion, with a gross profit of CN¥19.5 billion. Non rail revenue (car equipment, generators) was CN¥20.94 billion.[29]

In March 2016, CRRC Qingdao Sifang was awarded a contract to build 400 7000-series cars for the Chicago Transit Authority (CTA), with an option for another 446 cars. The cost of the contract was US$632 million up to US$1.3 billion with options; as a consequence CRRC began development of a US$40 million assembly factory in Chicago, designed by Itasca, IL-based Cornerstone Architects Ltd.[30][31]

In March 2017, Quincy, Massachusetts based CRRC MA was awarded a contract by SEPTA to construct 45 bi-level rail cars with the option for 10 additional cars for delivery in October 2019. The SEPTA order will be built at the Springfield plant[32] and car shell manufactured from the Tangshan plant.[33] CRRC was selected over Hyundai Rotem and Bombardier, which also bid on the bi-level contract and had each produced equipment for SEPTA in the past.[34] Later that month, CRRC was also awarded a contract to build 64 HR4000 cars for the Los Angeles County Metropolitan Transportation Authority (LACMTA) that will replace existing vehicles on the agency's Red and Purple lines, with an option for another 218 cars.[35]

The LACMTA order will result in a 41,218 square feet (3,829.3 m2) assembly plant (installing propulsion, HVAC and other general assembly) being built in LA.[32]

Shareholders[edit]

As of 31 December 2016, CRRC was majority owned by CRRC Group directly and indirectly (via CRRC Financial and Securities Investment, Chinese: 中车金证投资 for 1.64%[36]) for 55.91% of total share capital (all in A share).[3]:85 Other state-owned entities of the central government, such as China Securities Finance (2.87%) and Central Huijin Investment (1.12%), also owned a minority stake.[3]:83 In terms of different shares, BlackRock owned 6.13% H shares in long position (267,971,072 number of shares), or 0.98% in terms of total share capital.[3]:85 Himalaya Capital Investors, a Seattle based mutual fund also owned about 6.13% H shares in long position (267,904,000 number of shares).[37][3]:85 Other shareholders each owned less than 1% shares in terms of total share capital.[3]:83–85

Subsidiaries[edit]

Other investments[edit]

On 8 January 2016 CRRC Corporation purchased 13.06% stake of China United Insurance Holding (Chinese: 中华保险) from China Insurance Security Fund for CN¥4.455 billion.[38] It also joint-owned Zhuzhou Times New Material Technology with parent company CRRC Group.

In November 2016 the company (via CRRC Zhuzhou Locomotive) confirmed plans to buy Škoda Transportation based in the Czech Republic.[39][40] The deal eventually did not go through.

Products[edit]

Steam Locomotives

Diesel Locomotives[edit]

For China Railways:

For export:

Electric Locomotives[edit]

For China Railways:

For Export:

DMU and EMU[edit]

For China:

For Export:

High-speed trains[edit]

Passenger cars[edit]

Metro[edit]

China
Export
Sifang-built 8A trainset for Beijing Subway Line 16

Tram/Light Rail[edit]

Controversy[edit]

PRASA tender[edit]

In June 2016 a predecessor company of CRRC, CSR Corporation Limited, was implicated in allegations of bribery to obtain a 2012 US$6 billion tender to deliver 600 locomotives to the state owned Passenger Rail Agency of South Africa (PRASA).[50][51] It was reported that the future South African Public Protector Busisiwe Mkhwebane was implicated in the deal when she worked as Counselor Immigration and Civic Services in South Africa's embassy in China.[52][53] By 2020 it was reported that funds allocated to pay for an adjusted contract to deliver the locomotives produced by CSR Corporation, now reformed into CRRC, had been frozen by the South African Revenue Service due to possible instances of corruption paid to associates of the Gupta family.[54]

U.S. sanctions[edit]

The United States Department of Defense alleges CRRC is a supplier to People's Liberation Army.[55] In November 2020, Donald Trump issued an executive order prohibiting any American company or individual from owning shares in companies that the United States Department of Defense has listed as having links to the People's Liberation Army, which included CRRC.[56][57][58]

See also[edit]

Notes[edit]

  1. ^ Subsidiary of Zhuzhou CRRC Times Electric

References[edit]

  1. ^ a b "Chinese rolling stock manufacturers merge to form CRRC Corp". Railway Gazette International. 2 June 2015.
  2. ^ a b "Senior roles filled at CRRC". Railway Gazette. 25 June 2015. Archived from the original on 25 February 2016. Retrieved 22 January 2016.
  3. ^ a b c d e f g h i j k l m "2016 Annual Report" (PDF). CRRC. 27 April 2017. Retrieved 22 June 2017 – via Hong Kong Stock Exchange.
  4. ^ a b "List of Directors and their Role and Function" (PDF). CRRC. Hong Kong Stock Exchange. 20 June 2017. Retrieved 22 June 2017.
  5. ^ "股份领导" (in Chinese). CRRC. Archived from the original on 11 June 2017. Retrieved 22 June 2017.
  6. ^ "Siemens-Alstom Deal Teeters on Brink Amid Fierce Lobbying". www.bloomberg.com. Archived from the original on 2019-06-11. Retrieved 2019-01-23.
  7. ^ Smith, Kevin. "Will Alstom-Siemens merger check CRRC's international expansion?". Archived from the original on 2017-09-29. Retrieved 2017-09-29.
  8. ^ "Siemens-Alstom's Expected EU Veto Unleashes Political Storm". www.bloomberg.com. Archived from the original on 2019-02-07. Retrieved 2019-02-05.
  9. ^ "China's Top 2 Makers of Bullet Trains Merge". New York Times. 30 December 2014. Archived from the original on 19 June 2015.
  10. ^ wikisource:zh:国务院关于组建中国北方机车车辆工业集团公司有关问题的批复 (in Chinese)
  11. ^ "CSR and CNR Joint Announcement" (PDF). Archived from the original (PDF) on 9 May 2016. Retrieved 11 May 2015.
  12. ^ "CSR and CNR Joint Announcement Update" (PDF). Archived from the original (PDF) on 9 May 2016. Retrieved 17 June 2015.
  13. ^ "CNR and CSR agree merger terms". Railway Gazette International. 31 December 2014.
  14. ^ Barrow, Keith (22 October 2014). "CNR selected to supply new trains for Boston". International Railway Journal.
  15. ^ "Groundbreaking ceremony for CRRC's US assembly plant". Railway Gazette. 4 September 2015.
  16. ^ "First Orange Line T car shells arrive at CRRC factory in Springfield". masslive. Apr 11, 2018. Archived from the original on 20 July 2018. Retrieved 20 July 2018.
  17. ^ Barrow, Keith (13 July 2015). "CRRC opens Malaysian rolling stock plant". International Railway Journal.
  18. ^ "CSR adquiere EMFER y desembarca en la Argentina". En El Subte (in Spanish). 26 February 2014.
  19. ^ a b "Una empresa china quiere instalarse en la Argentina para fabricar vagones". La Nacion. 27 September 2016. Retrieved 28 September 2016.
  20. ^ "Dietrich acordó con gigante ferroviario chino instalar taller en el país". El Cronista (in Spanish). 28 September 2016. Retrieved 28 September 2016.
  21. ^ "CRRC reitera sus intenciones de instalarse en la Argentina". EnElSubte (in Spanish). 30 September 2016. Retrieved 30 September 2016.
  22. ^ "Compran 200 coches eléctricos adicionales para la línea Roca". enelSubte.com (in Spanish). 4 January 2018. Archived from the original on 10 January 2018. Retrieved 15 January 2018.
  23. ^ "Chinese manufacturer invests in US wagon venture". Railway Gazette. 6 July 2015.
  24. ^ "Vertex: Signs Of Growth Or Trouble?". Wilmington Business Journal. 19 June 2015. Archived from the original on 5 January 2017. Retrieved 5 May 2017.
  25. ^ "US-Chinese joint venture delivers first wagons". Railway Gazette. 22 January 2016.
  26. ^ a b "Vertex's deal with China cleared by Feds". Star-News Online. 14 December 2016. Retrieved 5 May 2017.
  27. ^ "Letter to Treasury Secretary Lew regarding CFIUS investigation on Vertex" (PDF). Sen. Jerry Moran. 29 September 2017. Archived (PDF) from the original on 13 April 2017. Retrieved 8 May 2017.
  28. ^ Cao, Bonnie (10 September 2015). "China Trainmaker CRRC Plans to Double Its Overseas Sales". Bloomberg L.P. Archived from the original on 6 March 2016. Retrieved 5 March 2017.
  29. ^ Briginshaw, David (1 September 2015). "CRRC first-half profits up while overseas revenue soars". International Railway Journal.
  30. ^ Barrow, Keith (9 March 2016). "CRRC to build up to 846 metro cars for Chicago". www.railjournal.com.
  31. ^ "China's CRRC wins $1.3 bln deal to supply Chicago rail cars". Reuters. 10 March 2016.
  32. ^ a b "CRRC MA CORPORATION > Home". www.crrcgc.cc.
  33. ^ "CRRC puts Septa double-deck coach design to the test". April 11, 2018. Archived from the original on September 22, 2019. Retrieved September 22, 2019.
  34. ^ Saska, Jim (17 March 2017). "SEPTA to pick Massachusetts-based company to build bilevel railcars over Hyundai Rotem in South Philly". PlanPhilly. Archived from the original on 20 March 2017. Retrieved 19 March 2017.
  35. ^ "L.A. Metro inks pact with CRRC for up to 282 new rail cars". Progressive Railroading. 24 March 2017. Archived from the original on 24 March 2017. Retrieved 24 March 2017.
  36. ^ "南车投资向中车金证无偿划转中国中车(01766)0.32%股本". 智通财经网 (in Chinese). 3 August 2017. Archived from the original on 29 September 2017. Retrieved 28 September 2017 – via qq.com.
  37. ^ "About our investing philosophy". himalayacapital.com. Himalaya Capital. Archived from the original on 12 June 2018. Retrieved 5 June 2018.
  38. ^ "Acquisition of 13.06% Equity Interests in China United Insurance" (PDF) (Press release). CRRC. 8 January 2016. Retrieved 13 October 2016.
  39. ^ "CRRC confirms plan to buy Škoda Transportation". Railway Gazette International. 30 November 2016. Archived from the original on 30 July 2017. Retrieved 27 July 2017.
  40. ^ "ANNOUNCEMENT IN RELATION TO PROPOSED OFFSHORE ACQUISITION BY A SUBSIDIARY" (PDF) (Press release). CRRC. 27 November 2016. Archived (PDF) from the original on 7 December 2016. Retrieved 27 September 2017 – via Hong Kong Stock Exchange.
  41. ^ NSW orders more Waratah EMUs for Sydney International Railway Journal 2 December 2016
  42. ^ "Bombardier to supply 246 Movia cars for Shanghai Line 12". Railway Gazette International. 2009-12-18. Archived from the original on 2011-06-16. Retrieved 2010-03-02.
  43. ^ Chan, D. M. (2019-10-21). "Chinese firms team up for Colombia subway". Asia Times. Retrieved 2020-07-05.
  44. ^ "Makkah metro contracts signed". Railway Gazette International. 2009-06-24. Archived from the original on 2010-02-28. Retrieved 2010-03-02.
  45. ^ NSW orders more Waratah EMUs for Sydney International Railway Journal 2 December 2016
  46. ^ 1,100 Jobs with 65 New Trains Built in Victoria, For Victoria Premier of Victoria 12 September 2016
  47. ^ Evolution Rail to supply Melbourne high capacity EMUs Railway Gazette International 12 September 2016
  48. ^ Moore, Craig. "Xiamen metro - the world's newest metro - Photos and first impressions". www.urbanrail.net. Urban rail net website. Retrieved 8 June 2018.
  49. ^ "CTA board approves contract to replace half of rail cars". Chicago Tribune. 10 March 2016.
  50. ^ "amaBhungane - Guptas' R51bn train grab". amabhungane.co.za. Retrieved 2016-07-16.
  51. ^ SOLE, STEFAANS BRÜMMER and SAM. "The Guptas' R51bn train grab". Sunday Times. Retrieved 2016-07-16.
  52. ^ Cameron, Jackie (2019-07-31). "HSBC joins dots from Gupta-friendly public protector to Chinese rail company kickbacks". BizNews.com. Retrieved 2019-08-01.
  53. ^ "$5,000 payment to Mkhwebane flagged by HSBC bank: report". TimesLIVE. Retrieved 2019-08-01.
  54. ^ Brümmer, Stefaans (2020-12-04). "amaBhungane: At a minute to midnight SARS tries to secure R4bn State Capture loot". Daily Maverick. Retrieved 2020-12-08.
  55. ^ Allen-Ebrahimian, Bethany (June 24, 2020). "Defense Department produces list of Chinese military-linked companies". Axios. Archived from the original on June 25, 2020. Retrieved June 24, 2020.
  56. ^ Chen, Shawna (November 12, 2020). "Trump bans Americans from investing in 31 companies with links to Chinese military". Axios. Retrieved November 12, 2020.
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External links[edit]