# Mexico: HSR contract awarded to ChinaRailway Construction canceled



## beautifulplanet (Nov 7, 2014)

Just four days ago, many thought it was a big announcement that a high-speed rail line would be built in Mexico between Mexico City and Queretaro (especially since Mexico currently doesn't have passenger rail besides some museum/tourist trains, Mexico City commuter rail, light rail and metro as well as Guadalajara light rail and the Monterrey metro).

The contract to build high-speed rail was awarded to China Railway Construction Corp. and its mexican partners, and the public service was supposed to begin as early as 2018.

Here is a news report from a few days ago:

Chinese-led consortium wins Mexico high-speed rail project
November 3, 2014
By Christine Murray

http://www.theglobeandmail.com/report-on-business/international-business/latin-american-business/chinese-led-consortium-wins-mexico-high-speed-rail-project/article21429186/

Surprisingly only a few days later, the contract has been canceled. A new bidding process is supposed to start:

Mexico cancels China contract for high-speed train line

November 7, 2014

http://www.bbc.com/news/business-29948331



> Rival bids by Germany's Siemens, Canada's Bombardier and France's Alsthom were considered.
> 
> According to reports, the three had asked for more time to prepare their submissions, but the requests were denied. Japan's Mitsubishi also expressed an interest.
> 
> ...




Also interesting is the following aspect of it reported by Bloomberg - that China Railway Construction Corp. did not even receive an official notification yet:



> China Railway Construction tumbled 5.8 percent today, the most since July 2013, to HK$8.02 at the close in Hong Kong. The Beijing-based company said by e-mail that it hadn’t received an official cancellation notice from Mexico.


source:

Mexico Cancels $4.3 Billion China Deal on Doubts Over Bid

November 7, 2014

By By Clement Tan and Nacha Cattan

http://www.bloomberg.com/news/2014-11-07/china-railway-shares-drop-on-report-of-losing-mexico-contract.html

Some might be curious to see how this development continues. With a 2018 public start of operations, this could have been the first 186mph+ high-speed rail service to operate on North American soil, still with the recent events the schedule will be pushed back...


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## Anderson (Nov 7, 2014)

My understanding was that the Mexico City-area line was actually only supposed to be running at something like 100-120 MPH (I'd previously seen it listed as about 180 KPH, not 180 MPH; someone probably got the metric/standard stuff backwards, though I have no idea whether that was the earlier report or this one). It very much came across as a long-haul commuter project rather than a "real" HSR one.


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## beautifulplanet (Nov 8, 2014)

Of course it can't be ruled out that the media reports got it wrong. Still it seems like they do speak of high-speed rail rail with a top speed of 186mph connecting the cities of Mexico City and Queretaro within 58 minutes, a distance of about 130 miles.



Anderson said:


> My understanding was that the Mexico City-area line [...]


Surprising to see it being called a Mexico City-area line, as it will connect to a different city with a metro area of more than a million people, outside of the governmental district of Mexico City, located in another state. The Mexico City area already has commuter rail, metro and light rail, while Queretaro currently doesn't have any form of local passenger rail.



Anderson said:


> [...] was actually only supposed to be running at something like 100-120 MPH (I'd previously seen it listed as about 180 KPH, not 180 MPH; someone probably got the metric/standard stuff backwards, though I have no idea whether that was the earlier report or this one).


Sure mistakes in unit conversions do happen sometimes, and the first press report mentioned above uses metric units, speaking of a "210-km line" and "speeds of as fast as 300 km/h". The second press report only says it's a "130-mile rail link" and the third says it will "shuttle 27,000 passengers a day between the capital and the industrial hub of Queretaro City in 58 minutes". Traveling 130 miles in less than an hour, the average speed would have to be higher than 130 mph, so a top speed of 186mph seems about right.



Anderson said:


> It very much came across as a long-haul commuter project rather than a "real" HSR one.


With Queretaro being such an industrial hub, the line probably tries to tap into the market of business people traveling between those cities, just like Texas Central Railway about a 1,000 miles north of it tries to tap into the market of 50,000 people traveling between Houston and Dallas every day. Still both might be considered "real" high-speed rail (at 186+mph, probably many people might call it that), while the schedule might offer more departures during the classic morning and afternoon rush hour times than during the rest of the day. As the schedules and lots of other details does not seem finalized, at least some might be curious to see how things will continue in the next years...


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## Paulus (Nov 8, 2014)

Anderson said:


> My understanding was that the Mexico City-area line was actually only supposed to be running at something like 100-120 MPH (I'd previously seen it listed as about 180 KPH, not 180 MPH; someone probably got the metric/standard stuff backwards, though I have no idea whether that was the earlier report or this one). It very much came across as a long-haul commuter project rather than a "real" HSR one.


Transportará al día 23 mil pasajeros a lo largo de 210 kilómetros, *a una velocidad máxima de 300 km/hr*


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## Paulus (Nov 9, 2014)

Possible bribery of the Mexican president involved. Would certainly make the absurdly short timeline weirdness make much more sense.


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## tp49 (Nov 9, 2014)

Per the below article the contract was yanked due the the aforementioned bribery issues.

http://www.latimes.com/world/mexico-americas/la-fg-mexico-china-bullet-train-20141107-story.html

I'm sure it will be reissued to the same parties when the payoff can be laundered a bit better.


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## tp49 (Nov 9, 2014)

Per the below article the contract was yanked due the the aforementioned bribery issues.

http://www.latimes.com/world/mexico-americas/la-fg-mexico-china-bullet-train-20141107-story.html

I'm sure it will be reissued to the same parties when the payoff can be laundered a bit better.


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## rrdude (Nov 10, 2014)

Still, it's entirely feasible that Mexico, the country that yanked 100% of it's passenger rail service decades ago, might have HSR rail, before the US does.

(Acela does not count as HSR)


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## Bob Dylan (Nov 10, 2014)

tp49 and rrdude are both spot on!

I'm Shocked! Shocked! to know that bribery and corruption goes on in Mexico! Round up the usual suspects!

It seems that the 7 million dollar house that El Presidents and his singer/movie star wife live in in the most exclusive hood in Mexico belongs to the Transportation Company that is part of the Cartel that received the Contract for the HS Line from Mexico- Queretero plus Multiple contracts from the Government while the Presidents was Governor of Mexico State!

A PR Flack has put out a Press Release saying that the wife made a 30% down payment and is paying off the mortgage. When its paid, it will be transfered to the first family!

And to think, Government officials in Mexico make $400 a month but can buy Multi-Million Dollar houses!( sort of like the Clintons!) Is the United States, er Mexico a great country or what??


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## afigg (Nov 10, 2014)

This makes Indiana DOT look good in its handling of the Hoosier State contract.

Sounds like the contact award to the Chinese and Mexican consortium was baked in by setting a too short a time for submitting a proper bid and then specifying a way too short time to build the line. I expect the plan was to land the contract by underbidding it, over promising on schedule, and paying off the right people. Then deliver the new HSR line over budget and late by circa 2020.

Not letting Siemens, Alsom, and Bombardier additional time to prepare their bids was a pretty big elephant sized clue that something was not kosher in the contract selection process. Still, by 2020, Mexico could have a true HSR corridor service while the the Acela IIs are running at 160 mph in only a small part of the NEC and CA HSR is still under construction.


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## Anderson (Nov 10, 2014)

As much of a mess as Mexico is, my first thought is that the bribery is borderline irrelevant. Such is the nature of Mexico at any time over the last century or so.


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## tp49 (Nov 10, 2014)

Anderson said:


> As much of a mess as Mexico is, my first thought is that the bribery is borderline irrelevant. Such is the nature of Mexico at any time over the last century or so.


If it was a US based company that bribed the Mexican government they would be prosecuted here under the Foreign Corrupt Practices Act. I can't remember off the top of my head if the PRC has an equivalent law but I don't think they do. However, such activities may hinder other potentially better bidders for the contract thus it may be more relevant than you think.


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## Bob Dylan (Nov 10, 2014)

In China its not a matter of law! Officials that are caught engaging in bribery/corruption are actually killed! ( well, those that are stupid enough to get caught!)


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## Anderson (Nov 10, 2014)

tp49 said:


> Anderson said:
> 
> 
> > As much of a mess as Mexico is, my first thought is that the bribery is borderline irrelevant. Such is the nature of Mexico at any time over the last century or so.
> ...


On the one hand I agree. On the other hand I'm...probably cynical enough to see it as a case of "Well, Mexico is corrupt to begin with so a bit more corruption probably won't do that much".


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## CHamilton (Jan 5, 2015)

Mexico to relaunch high-speed tender



> MEXICO's Federal Secretariat of Communications and Transport (SCT) confirmed on January 4 that it will issue preliminary bidding documents on January 14 for a revised tender for the contract to build the 210km Mexico City - Queretaro high-speed line.


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## Bob Dylan (Jan 5, 2015)

The corrupt Presidente and his PRI gangsters will figure out a way to make sure their "friends" ( ie Mordida providers) still get the contracts!


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## cirdan (Jan 6, 2015)

jimhudson said:


> In China its not a matter of law! Officials that are caught engaging in bribery/corruption are actually killed! ( well, those that are stupid enough to get caught!)


But that's for bribery within China.

When it comes to bribing outside China, many Chinese businessmen appear to be of the opinion that to do business in other countries you have to respect the traditions and ways of that country. And if those traditions and ways include bribery, who are they to want to stamp their inflated morals on others?


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## VentureForth (Jan 6, 2015)

I'm kinda bummed to see that Acela isn't considered by some here to be HSR. Heck, even the Silver Star between WAS and NYP hitting 115 MPH is pretty stinking High Speed. It's 30 MPH faster than an agressive driver. Even the Acela at top speed is 160 MPH which is 256 MPH - that's only 34 MPH less than the FASTEST HSR trains in the world. Granted, the distance available to that sort of speed is limited, but the regional/LD running anywhere faster than 90 MPH is high speed to me - and faster than driving.

It doesn't have to be the fastest train in the world to be HSR. Heck, I was probably the most vocally in suppoort of not calling Acela "true" high speed. Then, I rode in a Viewliner at its top speed along the NEC and was impressed. To think that Acela can even go faster than that is even more impressive. Amtrak has done a GREAT job with the money and resources they have been doled. There is room for improvement, and I think the most economical will be in the steel wheel technology - not maglev.

As for Mexico, I rode their passenger service the last year they were in existence between San Louis Potosi and Nuevo Laredo. It was a slow trip in coach. But I would do it again in a heart beat - especially to avoid their busses! Mexico has the economy and the population density for what they propose. The fact they are using Chinese technology is a shame - but if they can get it off the ground, it has real potential of taking off.


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## Paulus (Jan 6, 2015)

> Even the Acela at top speed is 160 MPH which is 256 MPH - that's only 34 MPH less than the FASTEST HSR trains in the world.


We found the Mars Climate Orbiter programmer...


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## cirdan (Feb 5, 2015)

Apparently the project has now been cancelled dur to budgetary reasons.

There will thus be no new winner of the contract.

Strange


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## Bob Dylan (Feb 5, 2015)

cirdan said:


> Apparently the project has now been cancelled dur to budgetary reasons.
> 
> There will thus be no new winner of the contract.
> 
> Strange


Its Mexico! All the money was stolen so no dinero for the project! Los siento!( see the stories about El Presidente and wife, and the PRI gang of thieves running the Government!)


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## CHamilton (May 22, 2015)

Mexico compensates China for cancelled HS project


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## Bob Dylan (May 22, 2015)

They should have impeached Senor Presidente and locked him and his celebrity wife up for the corruption involved in this one!

But it's Mexico, so .... business as usual!


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