MTR Corporation invited manufacturer of cracked Singapore trains to bid after informed of quality issues, HK government confirms

A press release by the Transport and Housing Bureau reveals that the MTR Corporation was informed of quality issues with Singapore’s subway trains in 2014

Corporations
Key timeline of events confirmed by FactWire
  • April-June 2014 MTR Corporation informed of quality issues with CSR Sifang trains

  • October 2014 MTR Corporation begins prequalification of tender for new urban line trains

  • January 2015 MTR Corporation invites CSR Sifang to bid

  • July 2015 MTR Corporation awards HK$6 billion contract to CSR Sifang for 93 trains of eight train cars each

  • April 2016 MTR Corporation sends resident staff to Qingdao factory to oversee manufacturing of 93 new trains

A press release by the Transport and Housing Bureau reveals that the Mass Transit Railway Corporation (MTR Corporation) was informed of quality issues with Singapore’s C151A subway trains manufactured by CSR Sifang Locomotive & Rolling Stock Company Ltd (CSR Sifang) in April to June 2014, shortly before inviting the same contractor to bid for a tender in October 2014 and awarding it the contract in July 2015.

The $HK6 billion contract awarded to CSR Sifang was for 93 new urban line trains of eight train cars each. Averaging HK$8 million per train car, the record low price was over 40% cheaper than previous purchases of new trains.

Earlier yesterday, responding to enquiries by FactWire reporters on why the recall of 35 C151A trains from Singapore did not affect CSR Sifang’s bidding prequalification, Chairman of the MTR Corporation Frederick Ma Si-hang stressed repeatedly, “I am not an administrative staff, so I hope the administrative staff will give an explanation in these few days.” He added that according to his understanding, “[after informed of] these so-called cracks, of course we (MTR Corporation) must do our work. After completing our work, we decided that from the tendering perspective, it did not affect their bidding prequalification, therefore we allowed them (CSR Sifang) to bid.” (Note: From December 2, 2007 to December 31, 2015, the chairman of the MTR Corporation was Raymond Ch’ien Kuo Fung; Ma replaced Ch’ien as chairman on January 1, 2016.)

On July 7, several hours after FactWire released an investigative report revealing that the Bureau received email complaints of quality issues with Singapore’s trains made by CSR Sifang in early 2015, the Electrical and Mechanical Services Department (EMSD) and the MTR Corporation both admitted knowing of the problems since 2014.

In the following days, FactWire made repeated enquiry to the MTR Corporation, asking in which month in 2014 it was informed of the quality issues, but it refused to provide specifics. After 8pm yesterday, the MTR Corporation gave a written response to FactWire, stating, “The MTR Corporation was informed of technical problems with trains in Singapore after communicating with the EMSD. The MTR Corporation then contacted Singapore and was informed that the situation in question would not affect driving safety. The company also contacted CSR Sifang and was informed of the cause of the problems and that the situation in question would not affect driving safety. CSR Sifang will follow-up appropriately on the trains with technical problems.”

Responding to media enquiries in the past several days, the Bureau and the MTR Corporation have stressed that the MTR Corporation has resident staff stationed at the manufacturer’s factory to oversee the entire process of manufacturing and assembly to ensure the trains meet the requirements in the MTR Corporation’s contract. Responding to FactWire’s enquiries, the MTR Corporation stated that it began sending staff to the factory since April 2014 to monitor the manufacturing of the 93 new trains.

On July 5, FactWire released an investigative report revealing that 35 C151A trains of Singapore subway operator SMRT Trains Ltd (SMRT) were being secretly recalled and replaced by their mainland Chinese manufacturer CSR Sifang in Qingdao due to cracks in their car bodies and key structural components. The same mainland manufacturer has been contracted by the MTR Corporation to manufacture nine trains for the Guangzhou-Shenzhen-Hong Kong Express Rail Link (XLR) and 93 trains for four urban lines.

CSR Sifang train cracks, MTR urban line bid timeline

July 2013 SMRT discovers cracks in C151A trains manufactured by CSR Sifang.

April 2014 EMSD receives email complaints of safety issues with Singapore trains made by CSR Sifang, including cracks. EMSD forwards the email to the Railway Development Office (RDO) of the Highways Department (HyD).

June 2014 The RDO of the HyD and the MTR Corporation provides a consolidated response to the EMSD, stating that SMRT trains were urban line trains, which are not the same type as high-speed rail trains.

July 2014 SMRT begins to ship defective C151A trains back to CSR Sifang’s factory in Qingdao for replacement.

October 2014 MTR tenders contract for 78 new trains, plans to invite bidders in January 2015. “Industrial enquiry” removed from prequalification process.

November 2014 The office of the Secretary for Transport and Housing receives a letter raising concerns on the safety of high-speed rail trains, also mentioning cracks in Singapore trains. An officer in the Secretary’s office referred the letter to the relevant subject team for follow-up. The relevant subject team then referred the letter to the RDO of the HyD and the EMSD for follow-up.

December 2014 The two departments replied to the THB in December 2014, with the MTR Corporation’s response incorporated into the RDO’s reply. The RDO again pointed out that as SMRT trains were urban line trains, and their design, material class and suppliers were different from high-speed rail trains.

January 30 and February 4, 2015 The office of the Secretary for Transport and Housing receives emails regarding high-speed trains and urban line trains. The emails mention cracks in the car body of SMRT trains. An officer forwarded the emails to the RDO of the HyD for follow-up on February 4, but missed the attachments to the email of January 30. (In the press release, the Bureau stressed that the missed attachments would not “result in the MTRCL being unacquainted with the issue of SMRT trains”.)

May 25, 2015 MTR announces tender to replace 78 trains costing est. HK$7 billion, averaging HK$90 million per train. Four bids received.

June 1, 2015 CSR Sifang and CNR completes merge, forms CRRC Corp.

July 9, 2015 MTR purchases 93 trains from CSR Sifang for HK$6 billion, averaging HK$64 million per train, 30% lower than originally estimated price.

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