cross-posted from: https://scribe.disroot.org/post/5662355
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As [Chinese state-owned company] CRRC’s long-distance trains were rolled out for the first time in Western Europe last week, Austria’s transport minister Peter Hanke said Vienna will launch an EU initiative by the end of this year to regulate against “cheap imports” from Chinese state-backed rolling stock manufacturers.
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However, the launch of the long-distance trains has drawn vehement criticism within Austria’s political and industrial circles — and even a new regulatory plan to shut out Chinese competitors from the EU market. That’s perhaps no surprise after CRRC’s victory in Westbahn’s 2019 tender became a symbol of the price challenge facing European manufacturers, who often cannot compete with what Brussels describes as “subsidised underbidding” by Chinese state-supported companies.
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With the trains now in operation, the tone has become even more combative, with Austria’s transport minister Peter Hanke stating earlier this month that Austria would put forward a proposal in the coming weeks to toughen EU-level procurement and digital security criteria for rolling stock purchased with public support. “We are investing over 20 billion euros in domestic rail infrastructure by 2030. These investments must create added value and jobs in the country,” said the minister. “If we allow cheap imports while Chinese state-owned companies distort the market with massive subsidies, we jeopardise our industrial base and make our critical infrastructure increasingly dependent on third countries.”
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Hanke first pledged the idea for new regulations after the European Union Agency for Railways (ERA) granted approval for the trains. “Do we want to comprehensively protect critical infrastructure in Austria and Europe, or do we allow third countries to jeopardise this valuable asset?” he asked. “We must not make our mobility dependent on third countries,” he said.
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The ministry’s draft calls for five binding quality criteria to be written into EU procurement rules for future rolling stock purchases. The first is technological sovereignty: “No remote control of our trains,” as Hanke put it, with full control over software and systems required to remain within the EU. Next are social standards, mandating that only suppliers meeting European labour and environmental rules can win publicly supported contracts.
A third criterion is regional value creation, which would introduce binding quotas for EU-based manufacturing and supply chains. The fourth, lifecycle transparency, would require full life-cost calculations including maintenance and spare parts. The fifth concerns mandatory security audits, involving regular checks for digital vulnerabilities or backdoors.
Still, while the emphasis may hinge on security, it’s clear that Hanke was perhaps rightly focused on the extent that Chinese imports will hit Western Europe’s already ailing industrial sector; Austria’s rail supply chain alone supports over 30,000 domestic jobs, as he pointed out, making it a central pillar of the country’s wider industrial economy.
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Brussels has several tools already in place to beat back challenges from Chinese vehicle imports — but pressure is growing to use them more aggressively. The Foreign Subsidies Regulation (FSR), introduced in 2023, allows the European Commission to investigate whether bids in large public procurement contracts rely on non-EU state support. It has already been activated in the rail sector, most notably in an ongoing case examining CRRC’s involvement in Lisbon’s tram procurements.
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Industry body UNIFE has for months been urging Brussels to harden tender criteria, arguing that European manufacturers cannot compete with what it describes as systematically subsidised underbidding. Indeed, while the rise of other non-European rail countries plays a significant role here, between 2021 and 2023 Europe’s rail giants lost an estimated 2.9 billion euros annually in global business, according to UNIFE, much of that thanks to CRRC’s expanded export activity.
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Brussels can tighten the rules, but it could also decide to back its own factories with the kind of long-term industrial support that built China’s scale in the first place. That would, however, require a different political mindset at a moment when the bloc’s budget is already under strain — and even with rail gaining ground in the next long-term EU plan, anything approaching China’s manufacturing model still feels a long way off.