Deal to Build High-Speed Rail Between LA, Las Vegas Called Off

Nine months after announcing that China would help build a high-speed rail line from Los Angeles to Las Vegas, the private U.S. company behind the plan says the deal is off and that it will seek a partner elsewhere.

Las Vegas-based XpressWest said in a statement that the decision to terminate the relationship with China Railway International was based "primarily upon difficulties associated with timely performance and CRI’s challenges in obtaining required authority to proceed with required development activities.”

The company indicated its "biggest challenge” was a federal government requirement that high-speed trains must be manufactured in the United States to secure regulatory approvals.

"As everyone knows, there are no high-speed trains manufactured in the United States,” the statement said. "This inflexible requirement has been a
fundamental barrier to financing high-speed rail in our country. For the past
10 years, we have patiently waited for policymakers to recognize high-speed
rail in the United States is a new enterprise and that allowing trains from
countries with decades of safe high-speed rail experience is needed to connect
the Southwest region and start this new industry."

XpressWest said it is optimistic that CRI and its affiliates will one-day succeed in establishing a viable presence in the United States rail market but that, in the meantime, it is undeterred by the obstacles "and remains dedicated to completing its high-speed passenger rail project.''

"XpressWest will now aggressively pursue other available development partnerships and options expected to result in a more efficient and cost-
effective project implementation experience,” said XpressWest CEO Tony Marnell.

The deal with the Chinese provided for CRI to assist develop, finance, build and potentially operate the XpressWest rail project connecting Las Vegas to Los Angeles, with stations in Las Vegas, Victorville and Palmdale, and service throughout Los Angeles.

China launched its own domestic high-speed rail service in 2007 and has the world’s most extensive network of such trains, covering more than 12,000
miles, according to the Los Angeles Times. It is now trying to export its rail
technology, vying for contracts in Mexico, Southeast Asia and elsewhere, according to the newspaper. The L.A.-Vegas route would have been China’s first such contract in the United States.

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