The Age wrote:New $2 billion train deal to create 1000 local jobs
More than 1000 local jobs will be created after the Andrews government announced a $2 billion package to build 65 new high-capacity trains in Melbourne's west had been granted to an international consortium.
The decision has been welcomed by many due to a 60 per cent local content requirement, but the Australian Workers Union says it is "heart-breaking" that some jobs will be sent to a Chinese firm with a poor record.
The Andrews government has announced a $2 billion package to build 65 trains in Melbourne's west. Video supplied by Victorian Government.
The consortium Evolution Rail is headed by Downer Rail and the Chinese-owned CRRC, with finance from the Plenary Group.
The Plenary Group is a big donor to Victorian Labor, giving $48,650 to the state branch last financial year.
The AWU, which represents workers at rival bidder Bombardier, has previously warned that the subsidiary of CRRC, Changchun Railways Vehicles has a poor track record.
The trains will be 20 per cent longer than the existing fleet and help boost capacity across the network. They will be assembled in Newport at Downer Rail.
The decision by Labor follows a 12-month tender process.
Premier Daniel Andrews said the package would include 60 per cent local content, as well as a requirement for 15 per cent of the workplace to be apprentices and from disadvantaged backgrounds.
Mr Andrews said the project would create 1100 jobs.
The $2 billion public-private partnership will last 35 years and includes maintenance. A new stabling and maintenance depot will be built in Pakenham East creating 100 jobs.
The first of the 65 trains are due to be tested on the network in November 2018, the same month the next state election is due.
Mr Andrews also announced that another nine six-car trains had been ordered from Alstom in Ballarat.
Downer's Newport facility will also undergo a $16 million upgrade and CRRC will set up a new regional headquarters in Melbourne.
"The state's largest single order of new trains will be built in Victoria, for Victoria," Mr Andrews said.
"We have a consistent policy and it is one that says let's put people first, let's make sure Victorian taxpayers' dollars support Victorian jobs."
A special partnership has also been struck to help transition Toyota workers into the locomotive sector.
AWU state secretary Ben Davis said trains built by the Chinese company for Singapore in the past had serious structural problems and there were reports from South Africa that CRRC did not meet its promised local content.
He said Bombardier would have provided 70 per cent local content.
"The decision is plain wrong when $2 billion of Victorian taxpayers' money goes to a contractor with a track record of not delivering the goods, or the jobs," Mr Davis said.
"The contract should have gone to the bidder who would create the most local jobs. It is beyond disappointing when jobs go to China, but this is heart-breaking to see what should have been a manufacturing boost for the state turned into little more than an assembly project."
Mr Andrews used the announcement to attack the previous Coalition government's procurement record as well as attack the Turnbull government for its navy ship building strategy.
The announcement was immediately welcomed by the Australian Manufacturing Workers Union.
"This announcement not only provides security and certainty to hundreds of workers and their industry, it also commits to long-term jobs and training opportunities for a new generation of highly-skilled workers," said AMWU State Secretary Steve Dargavel.
I would expect similar commentary regarding local content and the involvement of CRRC in the deal as we would have seen in relation to the Waratah contract in Sydney (as it is basically the same players). One could also see the disagreement between the AWU and AMWU over the result as basically a demarcation dispute (I haven't checked but I would expect that the AMWU would have coverage over Downer's workers). Also, Bombardier does have a fair bit going on already with the E-class tram build and the ongoing Vlocity build, and its bid would certainly not have been helped by the defective Vlocity wheel issue earlier this year. I fully expect that those who would have welcomed a fully off-shored contract awarded by Dennis Napthine and Terry Mulder (had they won in 2014) will bemoan a 60% local content requirement instead of 70% solely because it was awarded by Labor.Herald Sun wrote:Melbourne to get 65 new trains for the Cranbourne-Pakenham line
SERIOUS doubts have been raised about a Chinese company’s ability to deliver on its local content requirements for a $2 billion train fleet.
The Andrews Government today announced the winning tender to build 65 new high-capacity trains in Melbourne’s east had been granted to the China-backed consortium Evolution Rail.
The winning bid — which includes the Chinese state-owned CRRC — has promised 1100 local jobs will be created with a 60 per cent local build.
Premier Daniel Andrews hailed it as “trains for Victorians built by Victorians”.
But the Herald Sun has learnt the international consortium will import all of the carriage shells from overseas for the project.
It is understood the unsuccessful Bombardier bid, which already makes trains in Dandenong, had committed to a 70 per cent local build.
Australian Workers’ Union state secretary Ben Davis said CRRC had a record of “structural defects and of not honouring local content obligations”.
He said the China-backed bid would assemble “a glorified Lego set” in Victoria.
“It’s a real shame that the business which has the highest local content didn’t get chosen, because the higher the local content, the higher the local jobs,” Mr Davis said.
“The decision is plain wrong when $2 billion of Victorian taxpayers’ money goes to a contractor with a track record of not delivering the goods, or the jobs.”
As CRRC has embarked on an aggressive expansion over the past two years, concerns have been raised about its record of honouring local content obligations in a number of countries.
South African authorities recently launched an audit of 1064 new locomotives after CRRC was accused of not providing satisfactory information about its local build for a US$3.6 billion project.
In Turkey, the company was accused of “breaching project contracts” for not meeting local build requirements in 2014, according to a report by television channel Dunya News.
And Singapore has returned 26 defective trains to CRRC, three years after delivery.
The new train package for Victoria also includes a requirement for 15 per cent of the workplace to be apprentices and from disadvantaged backgrounds. A partnership has also been struck to help transition Toyota workers into the locomotive sector.
The new trains have 20 per cent more space to deal with overcrowding.
Transport Minister Jacinta Allan said there were strict audit and compliance provisions to ensure the local content requirement was adhered to.
“Unlike the former Liberal Government, who were going to build every single one of their new trains in South Korea, we’re ensuring our new trains are built in Victoria, by local workers,” she said.
Ms Allan said a further nine X’Trapolis trains would be built by Alstom in Victoria, as part of the rolling stock strategy that delivered $300 million of work to Ballarat.
CRRC was contacted for comment.
Where the trains will run
Earlier, Premier Andrews said the new trains would be used on the Cranbourne-Pakenham line from 2019 once new stations are built and nine level crossings removed.
Mr Andrews said the order was part of the 10-year rolling stock strategy, and would lead to a better public transport service.
He said with ship building under pressure in Melbourne’s west it was important to ensure job growth and work for high skilled industries.
“The state’s largest single order of new trains will be built in Victoria, for Victoria,” Mr Andrews said.
The new high capacity trains have 20 per cent more space to deal with overcrowding.
Ms Allan also said new trains were critical to the system, especially when the Melbourne Metro rail tunnel was opened by 2026.
“This is every train we need to boost services in Melbourne’s south east and run the turn-up-and-go services we’ll deliver by building the Metro Tunnel,” she said.