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Rep. Richard Neal to Trump trade rep: Exempt Springfield’s CRRC from tariff hike to grow jobs, keep fares low

February 28, 2019
In The News

U.S. Rep. Richard Neal on Wednesday urged the Trump administration’s top trade representative to spare CRRC-MA the 25 percent tariff imposed this summer on rail car components imported from China to CRRC’s Springfield factory.

“The imposition of these new tariffs will significantly increase CRRC-MA’s cost to manufacture rail cars, unfairly burden our public transit agencies, and raise fares for millions of Americans who depend upon public transportation each day,” Neal, D-Springfield, wrote in a letter he hand-delivered to Ambassador Robert E. Lighthizer, the U.S. trade representative.

Lighthizer testified Wednesday before the tax-writing House Ways and Means Committee. Neal is chairman of the committee and delivered a letter to Lighthizer in person after the hearing. The Ways and Means Committee oversees U.s. tax policy, including tariffs and trade.

In the letter, Neal points out to Lighthizer that Springfield is Neal’s hometown.

“Considering CRRC-MA’s investment in the United States and its record of economic development and job creation, I respectfully ask that you give strong consideration to their application for an exclusion waiver,” the letter reads. “It is my understanding that the company has submitted two waiver packages last year before the required deadline. These increased tariffs will have a negative financial impact on CRRC-MA, its operations in Springfield, MA and to public transit agencies who have already executed contracts with the company. I appreciate your personal interest in this matter.”

Neal points out in his letter that there are no U.S.-owned domestic makers of rail and transit cars.

In February, the office of the U.S. trade representative turned down 16 separate requests for exemptions filed by CRRC.

CRRC-MA has a total of 248 employees and most are in Springfield or Boston with a few in Los Angeles. Of the 248, 152 work in Springfield. Some 90 of the 152 are union production employees working at a $95 million factory in East Springfield that was once the site of the Westinghouse complex. The plant continues to hire as it ramps up production.

CRRC-MA also has plans to build a 42,500-square-foot warehouse at its Page Boulevard factory to house large components.

In 2014, CRRC received a $566 million contract from the MBTA to build 152 Orange Line cars and 252 Red Line cars. In December 2016, the state upped the order with another 120 new Red Line cars, with production set to begin in June 2022 at a cost of $277 million.

It also has contracts to make rail cars for SEPTA in Philadelphia and subway cars for Los Angeles. Assembly work will be in Springfield.

Production began on the first Orange Line Cars in April, and the plant will begin making Red Line cars in later this year.

The first of the Orange Line cars are undergoing tests now on the MBTA.

CRRC ships car shells here from China, where employees assemble and install electronics, seats, motors, wiring, display screens and everything else. A majority of the components are made in the U.S.