In 2012, Nippon Sharyo won a contract to build new bilevel railcars for California and the midwest. The railcars were supposed to have gone into use by now, but the project (predictably for the usual reasons) has suffered major setbacks. Last year, the carbody prototypes failed FRA crash standards, forcing designers back to the drawing board. There have been reportedly hundreds of change orders.
In January 2017, Caltrans was supposed to present an update for the “next-generation” bi-level cars at a TRB conference. That presentation was abruptly canceled. Steven Keck, CalTrans’ interim chief for rail, gave a cryptic explanation that no further information could be given due to ongoing negotiations over the schedule delays. Last month, Nippon Sharyo announced major layoffs at its plant, due to ongoing difficulties with the project:
Nippon Sharyo is cutting its workforce by about 110 employees because of continued complications with a prototype rail car, the company announced Monday. The rail-car manufacturer has laid off nearly two-thirds of its workforce in the past 5 months: It dropped 100 of its 350 employees in January.
“We continue to confront technical complications and delays with the bi-level rail car project that have forced us to evaluate the volume of work and the needs at our Rochelle facility,” the company said in a statement. “As a result, we have made the difficult decision to reduce our workforce.”
The project is funded by $551 million in federal funds from the American Recovery and Reinvestment Act. If the company cannot deliver on the contract by Sept 30, the funds revert back to the US Treasury.
Secretary LaHood announcing the Amtrak railcar order at the Nippon Sharyo plant, where he said: ” thanks to a standardized design initiated by our Federal Railroad Administration…the parts and components for passenger rail cars and locomotives lowers the costs of production and improves competition. It also makes it easier and reduces costs for operators to maintain equipment.”