A 2019 law prohibited Chinese state-owned and supported companies from bidding on federally funded railcar and bus transportation contracts. But a loophole allows these companies to access tax funds to supply U.S. airports.
Editor’s note: Scott Paul, president of the American Federation of Manufacturers, sent this message to email supporters on Monday. The full text is reproduced below.
Hello-
Philadelphia’s transit system recently announced it was canceling a controversial tax-funded contract it signed with a Chinese government-owned company called CRRC to manufacture rail cars.
The reason is obvious. CRRC was four years behind schedule and $50 million over budget, but not a single rail car was delivered.
This failure is just one of several CRRC projects that have gone off the rails. But despite its poor track record, and despite the numerous security risks of allowing companies with ties to the Chinese military to build U.S. infrastructure, CRRC and other Chinese companies remain taxpayers. has been able to bid on infrastructure projects financed by
Although Congress has taken steps to prevent this from happening again, the loophole continues to benefit these Chinese state-owned enterprises and those backed by them. It’s up to me and you to defend American manufacturers and workers.
Tell your legislators to support the Airport Infrastructure Vehicle Security Act now.
A loophole in the law allows CRRC and other Chinese companies to use American taxpayer funds to build rail cars and airport buses.
Congress correctly passed a bipartisan bill in 2019 called the Transportation Infrastructure Vehicle Safety Act (TIVSA) that would direct federal tax dollars to Chinese government-owned and supported companies to manufacture rail cars and buses. Forbidden.
This law made a lot of sense. Chinese transportation makers receive huge government subsidies that allow them to bid on contracts at significantly lower prices than other companies. That meant our own tax dollars were being used to undermine American producers and workers throughout the supply chain.
In one case, the Philadelphia transit agency awarded a contract to CRRC even though a local rail car factory bid for the same work. The factory eventually closed. What a wasted opportunity to support local job creation and grow the local economy.
TIVSA aimed to get things back on track. But the new law only applies to transportation projects, not federally funded contracts at U.S. airports. Unsurprisingly, companies like CRRC and fellow Chinese state-backed company BYD are now trying to exploit that loophole. Major U.S. airports in Tampa, Kansas City, Los Angeles and Atlanta are already using federal funds to purchase buses that would have been prohibited without the loophole.
It’s time to close the TIVSA loophole. Not only are American jobs and businesses at risk, but allowing a company with suspected ties to the Chinese military to supply critical airport infrastructure poses a significant national security risk.
thank you,
scott paul
president
Alliance for American Manufacturing
