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Texas Central signs a manufacturing deal

For your information.

The bullet train planned between Houston and Dallas has a builder.

Texas Central, the private company developing the Texas Bullet Train, announced Friday morning it signed a deal with Salini Impregilo, the Italian construction giant, and its American subsidiary, Lane Construction.

“This agreement brings us one step closer to beginning construction of the civil infrastructure segments of the project,” said Texas Central CEO Carlos F. Aguilar, in a statement.

The deal is valued at $14 billion and includes final engineering and design of the 240-mile high-speed rail line and construction of the route, mostly along a utility corridor between the two metro regions.

The full press release is here. Texas Central achieved another milestone a few days earlier.

The Federal Railway Administration granted the Rule of Particular Applicability—or RPA—to Texas Central on Sept. 4 regarding the high-speed rail project slated to connect Dallas and Houston, according to a Sept. 4 press release from Texas Central.

This means the high-speed rail project is on track for both FRA actions—the RPA and the environmental permit—to be completed in 2020 with financial close and construction quickly following, according to the release.

RPAs are regulations that apply to a specific railroad or a specific type of operation to ensure a project’s safety, according to FRA information. This action, along with an environmental permit, is required before the project can be implemented.

“The FRA’s action on the Rule of Particular Applicability marks a major milestone in our quest to bring a transformative mobility solution, while minimizing impact on the environment and land use, as opposed to other options,” Texas Central CEO Carlos Aguilar said in the release. “We will meet or exceed all requirements the FRA mandates, to ensure we have the safest high-speed rail system in the world.”

Here’s a longer version of the story. The Environmental Impact Statement is as always the big hurdle to clear. If they’re on pace for that, then we really will see actual construction begin. I’ll be looking for it.

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6 Comments

  1. Jules says:

    On pace? They haven’t been on pace for a while.

    In April of 2016, Texas Central told the STB “Texas Central’s business plan calls for it to begin construction in 2017, as soon as the requisite environmental reviews are complete and all regulatory approvals are acquired, and to initiate passenger service by late 2021.”

    They also said “The total cost of civil construction and the core system is estimated to be over $10 billion”. Now they are saying $20 billion.

    They don’t have $20 billion, they don’t have $14 billion, they don’t have the money to pay for the options contracts that are coming due this December.

    They don’t have eminent domain powers.

    This project isn’t on pace for anything.

  2. Jules says:

    Also no doubt this is a construction deal, not a manufacturing one. Most likely the train cars would be made in Japan if they ever get to that point.

  3. C.L. says:

    Build this bad boy and build it now. I don’t care whose money is used to fund it as long as it’s not US taxpayer money.

    It saddens me this one great county could lay infrastructure from one side of NYC to the other, from the east coast to the west coast, etc., but in 2019, can’t even build a rail car to run on a track… You want to make MAGA ?, then build factories to build rail cars…then sell them to Spain or Japan, etc.

    We’ve turned into nothing but a nation of consumers, consumers of products built by someone else. #Sad

  4. Jules says:

    They say they will see federal loans. Almost certainly won’t make enough to cover operating costs, much less pay off debt.

    Why do you want it to be built? So we can consume Japanese trains?

  5. Bill Daniels says:

    I agree with Jules. This is a project destined to fail. If it gets built, the project will never break even or make money. Individual companies will make money on it, for their part, and then vanish with their loot, but at some point, whoever loaned the money for the project is going to take it in the shorts. That loan guarantor should not be the federal or Texas state government.

    Maybe the project could be tweaked? How about high speed freight on the same tracks? If private industry can’t build it without risking taxpayer dollars in the form of loan guarantees, then it shouldn’t be built. Didn’t we learn the lesson with Solyndra?

  6. Jules says:

    CL, the RPA will likely be written to favor The Shinkansen, leading to a virtual HSR monopoly of a Japanese system in the US.

    The proposed Texas Central HSR will only run Shinkansen trains, on a closed proprietary system.