is china high speed rail profitable

Total investment in new rail lines grew from $14billion in 2004 to $22.7 and $26.2billion in 2006 and 2007. From nobody to somebody: China's high-speed rail in numbers China's high-speed rail network appears to be following this trend. Even the more modest plan to extend the maglev to Shanghai's other airport, Hongqiao, has stalled. When considering route strategy, HSR's market share versus other modes must be well understood. Annual car sales worldwide 2010-2022, with a forecast for 2023, Battery electric vehicles in use worldwide 2016-2021, Annual gas prices in the United States 1990-2021, Automotive industry worldwide - statistics & facts, Motorcycle industry in the United States - statistics & facts, Profit from additional features with an Employee Account. [11], Economically, there were initial concerns, particularly outside China, over the high-speed rail's cost, debt and profitability. [74] From July 20, 2011, the frequency of train service from Jinan to Beijing and Tianjin was reduced due to low occupancy, which renewed concerns about demand and profitability for high-speed services. [132] The proposed completion date for the network is 2030. [20] It was faster than the fastest trains in Japan at the time. You only have access to basic statistics. How profitable is China's high-speed rail? - Quora Ministry held the power drafting policy on railroad transposition, development of the rail network and rail infrastructure in China. Some 295 stations have been built or renovated to allow high-speed trains.[31][32]. Profit from the additional features of your individual account. [111] The BeijingTianjin, ShanghaiNanjing, BeijingShanghai and ShanghaiHangzhou lines reported breaking even financially[114][115][116][117] The Shanghai-Nanjing line even reported to be operationally profitable,[116] operating with a 380 million yuan net profit. China's high-speed rail expansion is entirely managed, planned and financed by the Chinese government. Bombardier, the first foreign train-maker to form a joint venture in China, has been sharing technology for the manufacture of railway passenger cars and rolling stock since 1998. [106] Affected lines included Xiamen-Shenzhen, Nanning-Guangzhou, Guiyang-Guangzhou, Shijiazhuang-Wuhan, Tianjin-Baoding and Shanghai-Kunming high-speed rail lines. August 18, 2020. However, these patents are only valid within China, and as such hold no international power. Why China can build high-speed rail so cheaply Rail Vehicle Market Report is highly -intensive driven by high R&D investment and has strong product analysis to maintain growth and ensure long-term monetization with a forecast period of 2023-2029. [68] Zhang Jianwei, President and Chief Country Representative of Bombardier China, stated that in a 2009 interview, Whatever technology Bombardier has, whatever the China market needs, there is no need to ask. Railway officials lowered the top speed of trains on most lines that were running at 350km/h (217mph) to 300km/h (186mph). [75], On July 23, 2011, two high-speed trains collided on the NingboTaizhouWenzhou railway in Lucheng District of Wenzhou, Zhejiang Province. Currently, you are using a shared account. High-speed rail service in China was introduced on April 18, 2007 and traffic has grown 30% per annum ever since, reaching 1.44 billion in 2016: four times of the HSR volume in Japan, nine times France's, and greater than north America's total air traffic. This ambitious national grid project was planned to be built by 2020, but the government's stimulus has expedited time-tables considerably for many of the lines. A planned launch of the maglev train was set for 2025. [45] According to CSR president Zhang Chenghong, CSR "made the bold move of forming a systemic development platform for high-speed locomotives and further upgrading its design and manufacturing technology. The Chinese firm will work alongside two Russian companies for on the designs for a total cost of 20.8 billion rubles ($383 million) over the next two years, according to Russian Railways. Construction of the high-speed railway between Beijing and Shanghai, the world's first high-speed rail with a designed speed of 380km/h (236mph), began on April 18, 2008. They became known as passenger-designated lines (PDLs). There is no better way of transportation than China's high-speed rail," Solheim added at his Wechat public account on Wednesday. This is . In 2004, the State Council in its Mid-to-Long Term Railway Development Plan, adopted conventional track HSR technology over maglev for the BeijingShanghai High Speed Railway and three other northsouth high-speed rail lines. [12][13] However, a Paulson Institute research had estimated that the net benefit of the high-speed rail to the Chinese economy to be approximately $378 billion and an annual return on investment at 6.5%. In 2018, China Railway operated 3,970.5 pairs of passenger train service, of which 2,775 pairs were carried by EMU train sets. Examples of technology transfer include Mitsubishi Electrics MT205 traction motor and ATM9 transformer to CSR Zhuzhou Electric, Hitachis YJ92A traction motor and Alstoms YJ87A Traction motor to CNR Yongji Electric, Siemens TSG series pantograph to Zhuzhou Gofront Electric. [123], The government actively promoted the export of high-speed rail technology to countries including Mexico, Thailand, the United Kingdom, India, Russia and Turkey. 110,000 mainland Chinese tourists leave Hong Kong on first day of A high-speed rail line connecting Kunming to Vientiane, the capital of Laos, was opened after five years of construction. [182], The MOR faces a debt-repayment peak in 2014. Trains on the Beijing-Tianjin high-speed line and a few other inter-city lines remained at 350km/h (217mph). [209] At the end of 2018, cumulative passengers delivered by EMU trains is reported to be over 9 billion. China's once profitable railways records $900bn debt over push for growth [37] The Japanese government touted the 40-year track record of the Shinkansen and offered favorable financing. Measured in passenger-kilometres Who We Are Work With Us Write For Us Media Release Partners Subscribe To ORF Contact Us research Programmes and Centres [4] China's HSR accounts for two-thirds of the world's total high-speed railway networks. 11, "China's Experience with High Speed Rail Offers Lessons for Other Countries", "China plans five-year leap forward of railway development ", "Bullet trains set to join fastest in the world", "International Railway Journal Rail And Rapid Transit Industry News Worldwide", "China slows its runaway high-speed rail expansion", "Hundreds protest Shanghai maglev rail extension", "Rail track beats Maglev in BeijingShanghai High Speed Railway", "BeijingShanghai High-Speed Line, China", "Violence flares as the Chinese rage at Japan", "Kawasaki Wins High-Speed Train Order for China", "China denies Japan's rail patent-infringement claims. Build It, And They Will. [55][56], By January 2011, China had the world's longest high-speed rail network with about 8,358km (5,193mi)[57] of routes capable for at least 200km/h (124mph) running in service including 2,197km (1,365mi) of rail lines with top speeds of 350km/h (217mph). In addition to track and scheduling improvements, the MOR also deployed faster CRH series trains. Mainland tourists said the high hotel prices and the fully resumed cross-border high-speed rail were factors in . As of 2023[update], it remains the fastest commercial train in the world with peak speeds of 431km/h (268mph) and makes the 30.5km (19.0mi) trip in less than 7.5 minutes. Higher-speed express train service allowed more trains to share the tracks and improved rail transport capacity. [178], The Shijiazhuang-Taiyuan PDL lost 0.8billion in its first year and is set to lose 0.9billion in 2010. In June 2002, a domestically made DJF2 train set a record of 292.8km/h (181.9mph) on the track. Sanctions: Economic Weapon of the New Cold War - MR Online Achieving indigenous high-speed rail technology has been a major goal of Chinese state planners. [49], On October 19, 2010, the MOR announced the beginning of research and development of "super-speed" railway technology, which would increase the maximum speed of trains to over 500km/h (311mph). The line has a capacity of delivering 100million rides annually[180] and initial estimated repayment period of 16 years. At the beginning of the 21st century China had no high-speed railways. Instead, a conventional subway line was built to connect the two airports, and a conventional high-speed rail line was built between Shanghai and Hangzhou. To date, China owns the largest HSR system in the world, with a total operating high-speed rail network of 40,000 kilometers in 2021. [106][147] The MOR, through its financing arm, the China Rail Investment Corp (CRIC), issued an estimated 1trillion (US$150billion in 2010 dollars) in debt to finance HSR construction from 2006 to 2010,[158] including 310billion in the first 10 months of 2010. Moreover, State-owned corporation also uses bulk purchasing to reduce material prices. Euro Carex (Europe Cargo Rail Express) is founded in April 2009 as an international non-profit association. [138], The safety issue that drew the attention of the public and the government was the Wenzhou train collision which happened on July 23, 2011, in which 40 people died, 172 were injured, and 54 related officials blamed and punished. They are built with the approval of the central government but are financed and operated largely by local governments with limited investment and oversight from the China Rail Corporation. [47] Kawasaki challenged China's high-speed rail project for patent theft, but backed off the effort.[48]. [1][2][3] The HSR network encompasses newly built rail lines with a design speed of 200350km/h (120220mph). [54] Most of the lines follow the routes of existing trunk lines and are designated for passenger traffic only. Many users want proof that high-speed rail can be a profitable, efficient job generator to help raise the sagging U.S. economy when compared with other types of transportation. [102] In late October and November 2011, the MOR raised RMB 250 billion in fresh financing and construction resumed on several lines including the Tianjin-Baoding, Xiamen-Shenzhen and Shanghai-Kunming. [144] In addition, it is hard to identify problems in the construction process, given the distribution resource planning system needed for rapid railway building and assembling. 10 years on, Beijing-Shanghai line on fast track to high-speed glory An extended version of the Fuxing bullet train is expected to . The GuiyangGuangzhou high-speed railway and LanzhouXinjiang high-speed railway (where fares do not cover electricity costs) are both suffering from high maintenance cost due to harsh climate conditions and complicated terrain structure. Even the Beijing-Shanghai line, China's most profitable high-speed rail line, reported 56.6 percent less net profit in 2021 than in 2019. On April 19, 2008, HefeiNanjing PDL in the East opened with a top-speed of 250km/h (155mph). Why High-Speed Rail is Such a Heavy Lift - Railway Age A unit of Russia's state-owned JSC Russian Railways signed a contract with the design unit of China's state-controlled China Railway Group to come up with the plans for a 770 kilometer high-speed rail between the two Russian cities. The Euro Carex is a truly European scale project that aims at using the existing high-speed . [60] Zhang was estimated to have misappropriated to his personal overseas accounts the equivalent of $2.8 billion. [23] In 1995, Premier Li Peng announced that preparatory work on the Beijing Shanghai HSR would begin in the 9th Five Year Plan (19962000), but construction was not scheduled until the first decade of the 21st century. [73] Foreign manufacturers involved in Shanghai-Beijing high-speed link reported that their contracts call for maximum operational speed of 300km/h (186mph). Intercity HSR service speeds range from 200350km/h (120220mph). [180] Others warn that the financing side of the existing construction and operation model is unsustainable. The line was electrified in 1998, and Swedish-made X 2000 trains increased service speed to 200km/h (124mph). The report quotes an unnamed executive who . [54] The envisioned network, together with upgraded existing lines, would total 12,000km (7,456mi) in length. [40] These trains, designated CRH1A, were delivered in 2006. While a number of high-speed railways in eastern China have started to be operationally profitable since 2015, the high speed railways in the midwest still operate at a loss. A paid subscription is required for full access. The economics of a new China-Laos train line | The Economist [102] New projects were put on hold and completion dates for existing projects, including the Tianjin-Baoding, Harbin-Jiamusi, Zhengzhou-Xuzhou and Hainan Ring (West), were pushed back. 29 Apr 2023 00:13:13 The expansion into HSR is also developing China into a leading source of high-speed rail building technology. Critics both in China and abroad have questioned the necessity of having an expensive high-speed rail system in a largely developing country, where most workers cannot afford to pay a premium for faster travel. Most of China's hsr lines are actually quite busy. [note 3] The HSR building boom continues with the HSR network set to reach 70,000km (43,000mi) in 2035. data than referenced in the text. For example, the BeijingTianjin intercity railway in its two full years of operation, delivered over 41 million rides. Show sources information [134], The HSR network reached 37,900km (23,500mi) in total length by the end of 2020. As a Premium user you get access to background information and details about the release of this statistic. [71] The CRH380A trainsets on the BeijingShanghai high-speed railway could reach a top operational speed of 380km/h (240mph) but were limited to 300km/h (186mph). China's most profitable high-speed rail line, reporting 6.6 billion yuan (over $1 billion) in net operational profit in 2015, connects Beijing to Shanghai, two major economic zones. Chart. High-speed rail developed rapidly in China since the mid-2000s. The HSR network includes new mixed passenger-freight lines with a design speed of 200250km/h (120160mph). China's Experience with High Speed Rail Offers Lessons for Other Countries [214] In June 2020, a trial run was conducted at Tongji University. The line cost 20.42billion to build, and 1.8billion per annum to operate, including 0.6billion in interest payments on its 10billion of loan obligations. Show publisher information Trains can operate at 200km/h (124mph) on many of the conventional main lines. Along with CRH3C, produced by Siemens and CNR Tangshan, CSR Sifang bid 60 sets of CRH2C. The WuhanGuangzhou high-speed railway (Wuguang PDL), which opened on December 26, 2009, was the country's first cross-regional high-speed rail line. [117], On December 28, 2013, the total length of high-speed rail tracks nationally topped 10,000km (6,200mi) with the opening of the XiamenShenzhen, XianBaoji, ChongqingLichuan high-speed railways as well as intercity lines in Hubei and Guangxi. How much is a high speed train ticket in China? [146], According to a costbenefit analysis by the Paulson Institute, the high-speed rail network benefits the Chinese economy by $378 billion, with an annual return on investment of 6.5%. Observer Research Foundation | ORF [99] The speed of the remaining 350km/h (217mph) trains between Shanghai and Hangzhou was reduced to 300km/h (186mph) as of August 28, 2011. The study also noted a range of benefits which included shortened travel times, improved safety and better facilitation of tourism, labor and mobility, as well as reducing highway congestion, accidents and greenhouse emissions as some automobile travellers switch from car use to rail. China's railway diplomacy hits the buffers | Financial Times [14] The report also found that the highest benefit high-speed rail hubs were the ones going through densely populated corridors such as Shanghai, Hangzhou, Beijing, Wuhan and Guangzhou, while the lowest benefit ones were remote locations such as Kunming, Nanning and rmqi.[14]. [21] In December 1990, the Ministry of Railways (MOR) submitted to the National People's Congress a proposal to build a high-speed railway between Beijing and Shanghai. The high-speed rail (HSR) network in the People's Republic of China (PRC) is the world's longest and most extensively used with a total length of 42,000 kilometres (26,000mi) by the end of 2022. On mixed-use HSR lines, passenger train service can attain peak speeds of 200250km/h (120160mph). [183] In 2016, the high-speed rail revenue was 140.9 billion RMB Yuan (20 billion USD), while the same term interest from at least 3300 billion debt of its construction was 156.8 billion RMB Yuan (22.4 billion USD). As of 2022, the China State Railway Group has had a debt of around $900 billion USD, according to Nikkei. [84][85][86] The Wenzhou train accident and the lack of accountability by railway officials caused a public uproar and heightened concerns about the safety and management of China's high-speed rail system. The protests gathered over a million signatures and politicized the issue. Train travel between central and southern Chinas largest cities, Wuhan and Guangzhou, was reduced to just over three hours. According to a World Bank paper published last week, China's high-speed rail so far has cost between $17m and $21m per kilometre, even though it has a high ratio of big-ticket viaducts and tunnels. [178] To break even, the line must deliver 30 million rides annually. [185], In 2013 fares for China's high-speed rail service costs significantly less than similar systems in other developed countries, for comparison high speed rail tickets in France or Germany cost slightly over US$0.10 per kilometer and the various Shinkansen services hover above US$0.20 per kilometer. But high-speed trains often have to share tracks with slower, heavy freight trains in some cases with as little as 5 minutes headway. [27][note 4] In all, travel speed increased on 22,000km (14,000mi), or one-fifth, of the national rail network, and the average speed of passenger trains improved to 70km/h (43mph). [104], To ease the credit shortage facing rail construction, the Ministry of Finance announced tax cuts to interest earned on rail construction financing bonds and the State Council ordered state banks to renew lending to rail projects. As of 2007, the Qinhuangdao-Shenyang high-speed railway, which carried trains at top speed of 250km/h (155mph) along the Liaoxi Corridor in the Northeast, was the only passenger-dedicated HSR line (PDL) in China, but that would soon change as the country embarked on a high-speed railway construction boom. [60] Investigators found evidence that another 187million ($28.5million) was misappropriated from the $33billion BeijingShanghai high-speed railway in 2010. By 2008, as part of the infrastructure development plan that accompanied the country hosting the Olympic Games, high-speed trains between Beijng and Tainjin were introduced and set the world record for average journey speed at 313km/h . [59], In February 2011, Railway Minister Liu Zhijun, a key proponent of HSR expansion in China, was removed from office on charges of corruption. [159] CRIC has also raised some capital through equity offerings; in the spring of 2010, CRIC sold a 4.5 percent stake in the BeijingShanghai high-speed railway to the Bank of China for 6.6billion and a 4.5 percent stake to the public for 6billion. On 2011-07-24. In 2018, annual ridership on EMU train sets, which encompasses officially defined high-speed rail service as well as certain sub-high-speed service routes, accounted for about two-thirds of all regional rail trips (not including urban trains) in China. Learn more about how Statista can support your business. According to the "Mid-to-Long Term Railway Network Plan" (revised in 2008), the MOR plans to build over 40,000km (25,000mi) of railway in order to expand the railway network in western China and to fill gaps in the networks of eastern and central China. [188] As of October 2013, high-speed rail was carrying twice as many passengers each month as the country's airlines. According to Xinhua News Agency, the aggregate results of the six Speed Up Campaigns were: boosting passenger train speed on 22,000km (14,000mi) of tracks to 120km/h (75mph), on 14,000km (8,700mi) of tracks to 160km/h (99mph), on 2,876km (1,787mi) of tracks to 200km/h (124mph) and on 846km (526mi) of tracks to 250km/h (155mph). China Railway assumed control of complete railway network that was built by the dissolved Ministry of Railways. A notable example is the GuangzhouShenzhen railway, which in December 1994 became the first line in China to offer sub-high-speed service of 160km/h (99mph) using domestically produced DF-class diesel locomotives. New rail lines are simply not going to be as profitable as more mature rail lines that have reached their planned capacity targets. In the same year, the Ministry of Science and the MOR agreed to a joint action plan for the indigenous innovation of high-speed trains in China. Under political and public pressure, the National Audit Office (NAO) carried out an extensive investigation into the building quality of all high-speed rail lines. [42] They are known as CRH2A. [34] These concerns have prevented the construction of the proposed extension of the maglev to Hangzhou. Directly accessible data for 170 industries from 50 countries and over 1 million facts: Get quick analyses with our professional research service. [Online]. With a total length of 968km (601mi) and capacity to accommodate trains traveling at 350km/h (217mph), the Wuguang PDL set a world record for the fastest commercial train service with average trip speed of 312.5km/h (194.2mph). Statista. [210] China currently holds many new patents related to the internal components of these trains, re-designed in China to allow the trains to run at higher speeds than the foreign designs allowed. According to an analysis conducted in 2019, only five out of 15 fast 350 kilometers-per-hour high-speed railway lines in China could cover all costs, including operating and capital costs.. [186] However, China's average income per capita is considerably lower than these other countries, so the high speed train fares remain unaffordable for most but the well-to-do. [52][53] The government has justified the expensive undertaking as promoting a number of policy objectives. [194], Two other Maglev lines, the Changsha Maglev and the Line S1 of Beijing, were designed for commercial operations with speeds lower than 120km/h (75mph). [83] State-run Chinese media confirmed 40 deaths, and at least 192 people hospitalised, including 12 who were severely injured. 1st May 2023, 23:03 GMT+10. PDF EXPRESS FREIGHT TRANSPORTATION BY HIGH-SPEED RAIL: THE CASE OF CHINA Ge

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