Mayor Seeking To Protect $1.3 Billion CTA Contract During China Trip
CHICAGO (CBS) -- Mayor Rahm Emanuel is traveling to China this week, and is hoping to protect a major CTA deal from the Trump administration's growing trade dispute.
While in China, Emanuel will visit the Chinese company that has a $1.3 billion contract to build CTA train cars at a factory in the Hegewisch neighborhood of Chicago.
CRRC Sifang America built a new $100 million factory at 135th and Torrence, where it will assemble more than 800 new 7000-series rail cars for the CTA. The parts for the cars will be made elsewhere, including in China.
The factory is expected to begin assembling the first 400 rail cars beginning in 2019.
With the Trump administration imposing 25 percent tariffs on $34 billion of Chinese goods last week, and China responding with retaliatory tariffs on U.S. goods, the mayor's office is worried the CTA deal ultimately could be affected by the trade war.
The mayor and a delegation of 40 city and business leaders were flying to China and Japan on Monday to meet with corporate leaders. Emanuel is is worried the competing U.S.-Chinese tariffs could lead to higher production costs and fewer jobs at the CRRC factory in Chicago.
"I do not want that to be a bargaining chip. I don't want it to be a victim of the Trump trade war," Emanuel said Monday morning at an event to unveil the design of a new CTA Green Line station at Damen and Lake.
While tariffs imposed thus far do not affect the rail car factory, Emanuel said there is no telling where the trade dispute will go, and he doesn't want Chinese leaders using the CRRC factory as leverage.
"Nobody knows where this is headed. So my view is, while the trip was always planned, my goal is to assure this is secure; it is not only built here, that it will be producing rail cars for the city of Chicago," Emanuel said.
Emanuel said CRRC also has a facility in Massachusetts, and he doesn't want to see the company shipping the rail car production out of Chicago.
