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Posts Tagged ‘China’

Four of China’s HSR Lines Profitable

China’s HSR network is both impressive and financially viable:

According to a report late last year, four of the country’s high-speed rail lines achieved break-even since the bullet trains started running full-speed, intercity services – with ticket revenues matching costs, including debt payments – on several routes, including Beijing to Tianjin, Shanghai to Nanjing, Beijing to Shanghai and Shanghai to Hangzhou lines.

Not only does the high-speed rail system work, it’s financially workable too.

Note how they include debt payments in the cost calculations, whereas in the US we only include operating expenses. Of course, it helps when your construction costs are really, really low:

The web of bullet train lines will reach 18,000km by 2015, Sheng Guangzu, minister of railways, told a recent rail conference. That means more than 8,000km of newly built stock will be put into service within three years. The plan is to expand this to 50,000km by 2020, with four main lines running north and south, and another four east and west. The high-speed train pulls in to vast, customised stations, with terrific facilities.

Investment in the high-speed rail network was a big part of China’s infrastructure spending programme in 2008/2009, when Beijing pushed out a four trillion yuan (€490 billion) stimulus to fight the financial crisis. The rail ministry plans to invest 650 billion yuan (€76 billion) in railway infrastructure, aiming to have 5,200 kilometres of new railways opened this year.

All of the new HSR capabilities is causing major disruption for Chinese airlines. In the long run, they will have to shift to more international service.

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From the China Daily:

China’s largest train maker, CSR Corp Ltd, launched over the weekend its first test train that can reach speeds of up to 500 km an hour.

The six-carriage train with a tapered head is the newest member of the CRH series. It has a maximum drawing power of 22,800 kilowatts, compared with 9,600 kilowatts for the CRH380 trains now in service on the Beijing-Shanghai High-Speed Railway, which hold the world speed record of 300 km per hour.

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Hot Sexy Train Attendants

Some photos of the, um, etiquette training for train attendants on China’s new high-speed rail services. Applicants should be 20-years old (or younger), and of “dignified appearance”.

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China Rail Traffic

The Atlantic is at it again.

Last week, Megan McArdle argued high-speed rail did not make sense in America. This week, she argues against high-speed rail in China, the world’s most populous country.

She describes Chinese rail investment as a colossal misallocation of resources, on par with the West’s trillion dollar housing bubble:

These projects don’t have to go to the market for loans; the government directs the state-owned banks to lend to them, at interest rates decided by the state. There’s no opportunity cost to the money, since it’s not like the rail ministry would otherwise be building a chain of noodle shops. And the ridership projections are vetted by the same people who want to build 16,000 km of high-speed rail. Prices are really useful. But in whole large sectors of the Chinese economy, particularly the banking sector, the government sets those prices. This means huge information loss, and the concomitant possibility that there is a vast misallocation of resources.

While the Atlantic seems to view the China rail ministry as an economic basketcase, the traffic numbers show quite the opposite. Here are figures posted by railway expert Hans-Joachim “Hajo” Zierke:

Country Network length Transport volume ton mile/route mile
China 2006 47600 mi 1.97 trillion ton-miles 41.4 million ton-mi/mi
USA 2005 95830 mi* 1.68 trillion ton-miles 17.5 million ton-mi/mi

* Only Class 1

In other words, China achieves better than double the ton-mi efficiency as the US.

And then there is the passenger traffic:

Country Network length Transport volume passenger mile/route mile
China 2006 47600 mi 411 billion passenger mi 8.6 million passenger-mi/mi
Germany 2006 21500 mi 49 billion passenger mi 2.3 million passenger-mi/mi

Oh, did I mention China carries all this traffic on the same network? Whereas the US can only do freight, and Europe can only do passengers, China manages both at the same time. And their mixed-trafffic tracks are being upgraded to 125mph (what we in the US would call “high-speed”).

As Hajo says, “The Chinese are the only people with a government, that fully understands, what can be done with a railroad.” That will surely be the case, too, with high-speed rail.

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China, US, and Europe

The distance from Los Angeles to New York is 2800 miles — which makes high-speed rail impossible in the USA. At least, that is what Megan McArdle argues in the Atlantic:

Yesterday, we rode the high speed rail from Hangzhou to Shanghai. It took 45 minutes to go about 110 miles, and the ride was smoother than any US form of transportation…Unfortunately, I don’t think we’re going to get it. To see why, compare the map of the 10 biggest cities in China:

And here is the map Megan proudly presents of China’s largest cities:

And here is the map Megan proudly presents of America’s largest cities:

The crux of her argument is that America’s 10 largest cities are more spread out than China’s 10 largest cities. Why is high-speed rail limited to only the 10 largest cities…who knows?

For comparison, here is a map of Europe’s 10 largest cities. I hear Europe has a network of high-speed trains too.

Those points in the upper northeast are Moscow and St. Petersburg. Over in the far southwest corner is Madrid. Distance from Madrid to Moscow is roughly 2500 miles. (No fair throwing Istanbul you say? Well, Turkey is building high-speed rail network too.)

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China Car Production Surpasses US

China is on track to becoming the world’s largest automobile manufacturer.

On the morning of October 20, Changchun, the city of vehicles, was the scene of jubilation when China’s 10 millionth vehicle, a golden orange Jiefang J6 heavy-duty truck, came off the production line at First Automobile Works (FAW) Group Corp. This makes China the third country in the world to annually produce 10 million vehicles, following only the U.S. and Japan. Zhang Dejiang, member of the Political Bureau of the CPC Central Committee and vice premier of the State Council, sent a congratulatory letter.

By year’s end, China is expected to produce over 13 million vehicles — versus 10.5 million in the US. Just 3 years ago, US auto production stood at around 16 million vehicles per year.

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