Greg Hinz of Crain’s Reports on ELPC High-Speed Rail Supply Chain Report

Thursday, February 14, 2013

Midwest factories among high-speed rail winners: report

By Greg Hinz, Crain’s Chicago Business

Who says living in the so-called Rust Belt is all bad?

A new report says that Chicago and Midwest manufacturers are disproportionately benefiting from the billions being spent for high-speed (or at least higher-speed) passenger railroad traffic. Up to 460 companies located within a few hours of Chicago are potentially in position to snag some business.

The report — “Midwest High-Speed Rail Supply Chain” — comes from Chicago’s Environmental Law and Policy Center, and while that group is as green as they come, it usually nails its facts.

In this case, according to the report, the Midwest is home to 12 major equipment makers and 460 smaller suppliers that build train sets, locomotives and the items that go into them.

An example: last year’s $352 million award to Nippon Sharyo USA in Arlington Heights to build 130 bi-level passenger cars that will go on Amtrak routes to and from Chicago and in California. The rail cars are designed to go up to 110 miles an hour.

Another big equipment maker here is Electro-Motive Diesel in La Grange, one of four domestic locomotive manufacturers believed to be bidding on a roughly $400 million contract to make 33 engines that will go on the Midwest and California routes.

Each of the four manufacturers has a long list of local suppliers, the report says, such as Electro Wire in Schaumburg, which makes and services railroad cabling and electronics. Another, Chicago’s Freedman Seating Co., recently announced it will add workers to handle a large order from the Chicago Transit Authority to supply seats for new el cars that will go into service in the next few years.

“In the Midwest, we make stuff,” quips law center Executive Director Howard Learner. Not all of the 460 companies will get work, but all are in the rail business one way or another, and all “will have opportunities to get” the high-speed rail money.

Nippon also has received major pacts from Metra, the commuter rail service.

Of course, Congress, after signing off on $12 billion early in President Barack Obama’s tenure, has balked at appropriating more for faster passenger rail, with many conservatives arguing that the expenditure is an unaffordable luxury, given other national needs. But Mr. Learner — always the optimist on this stuff — says he sees signs that even GOP governors in Wisconsin and Indiana may be moving in his direction.

Much of the work on the Chicago-St. Louis and Chicago-Detroit lines is already done — the big missing piece on the latter is in Lake and Porter counties in northwest Indiana. So advocates like Mr. Learner are looking next at Iowa, which has held hearings recently about extending a new line from the Quad Cities to Iowa City — or even Omaha, Neb.

We shall see.

Read the story at Crain’s.

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