Metro rail-car maker considers leaving industry
After safety problems, Kawasaki reports huge quarterly losses
Faulty wiring. Bad welding. Poor paint jobs. Metro has had more than its share of problems with its newest fleet of rail cars, the 7000 series.
Now it appears those issues are catching up with the company that manufactures the cars.
Citing disappointing quarterly financial results, a top executive at Kawasaki Heavy Industries said this week that it is contemplating getting out of the rail car building business.
According to Jiji Press, Kawasaki chief executive Yoshinori Kanehana said the company may consider forming a business alliance or closing down its rail vehicle business if it can’t turn things around.
The Lincoln Journal Star reported that Kawasaki, in announcing its quarterly earnings, said its rolling stock division, which has an assembly plant in Lincoln, Neb., lost more than $78 million for the first two quarters of its fiscal year, which ended Sept. 30. Some of those losses were tied to contracts with Metro and the Long Island Railroad, which have proved less profitable than the company anticipated.
Kawasaki did not respond to a request for comment from The Washington Post on the losses or the potential shuttering of its rail-car division.
However, even if Kawasaki were to abandon its rail-car business, it’s unlikely to have an impact on its contract with Metro. The company has a $2 billion deal with the transit agency to build 748 cars, replacements for the most problematic in the agency’s fleet.
“Metro has a binding contract with Kawasaki, and to date, they have delivered 600 of 748 rail cars,” Metro spokeswoman Sherri Ly said in an email. “We expect to have all 748 on the system late next year, ahead of schedule.”
She added that Metro did not anticipate problems with finding replacement parts for the trains in the future because the parts are manufactured by U.S.-based suppliers under federal Buy America requirements.
The new trains have had their own problems. Officials identified design flaws as far back as 2015. There were delays in manufacturing, due in part to the earthquake and tsunami that hit Japan in 2011. But in recent months, there have been reports of other problems.
In June, federal regulators ordered Metro officials to retrofit the 7000-series cars already in service with new safety devices to prevent passengers from falling between train cars. The order came after a blind passenger fell into a gap between two cars and onto the tracks in May.
Then in August, Metro officials announced that wiring in all of the trains would have to be replaced after internal inspections identified flaws, which could affect the rail cars’ long-term reliability.
Ly said work on the wiring is ongoing but because it did not require immediate action, it will be done as part of the routine maintenance process.
“Metro is the process of developing a long-term schedule for the rail car manufacturer, Kawasaki, to perform the work under its contract obligations,” Ly said in an email.
As of July, Metro had received 564 of the 748 rail cars it had ordered. Roughly 548 of those cars were in service but would have to be pulled out for rewiring.
It’s unclear how the company abandoning the business might affect future problems Metro might have with the rail cars.