
One of the MBTA's new Red Line trains pulls into Charles MGH station in early 2023. Photo by James Sanna | Banker & Tradesman Staff
The head of the MBTA does not expect tariffs to affect what the transit agency will pay for new subway cars from a Chinese manufacturer.
MBTA General Manager Phil Eng said Wednesday that the idea of CRRC passing along some of the higher costs it will face under President Donald Trump’s tariffs on China “is not part of the discussion.”
“Right now, that impacts CRRC themselves. It doesn’t impact us and what we renegotiated,” Eng said in an interview on GBH News’s “Boston Public Radio.” “But I know this talking to CRRC leadership: they’re committed to delivering these cars. What we’re monitoring is also the [subcontractors] and the material suppliers because they’re key to CRRC’s success as well.”
Trump moved last week to increase tariffs on imported Chinese products to 20 percemt, and he further increased tariffs on aluminum and steel from China.
Radio host Jim Braude pressed Eng on what kind of “leverage” the T has in the relationship, asking if the MBTA would be able to reject a hypothetical request by CRRC to split the higher costs stemming from tariffs.
“Right now, contractually, there’s no requirement for that. We’ve already offset a lot of the costs,” Eng replied. “If you actually go back into the details of the agreement [with CRRC], the majority of that cost was for the material providers, the subs.”
“This is not just this industry,” he added. “We’re watching all the other things, the bus manufacturers. It’s something where we’re going to know that their costs will go up, but we’re going to have to continue — by the way, these cars are still, in today’s prices, a bargain compared to what we would do if we had to go out and get a new procurement.”
The T expects to pay CRRC more than $1 billion for fleets of new Red and Orange Line cars. The delivery of some of those cars has been delayed. Last year, agency overseers approved a contract update that committed up to $148 million more to the Chinese manufacturer and waived penalties against it.
The updated contract calls for all Orange Line cars to be delivered by September 2025 and for the last Red Line cars to be delivered by December 2027.
As of Wednesday, the MBTA has received 140 new Orange Line cars and 38 new Red Line cars, a spokesperson said.
Eng said CRRC has been delivering cars on time since the contract renegotiation, and he added that the new trains have been performing well, in some cases more than doubling the minimum travel distance between “failures” set in the agreement.
Asked about federal dollars more broadly, Eng said he’s “confident” the T will continue to receive formula funds and awards for projects, a more optimistic outlook than many budget-writers on Beacon Hill who are sweating the potential loss of money from Washington, D.C.
“We’ve been successful in the past pursuing federal dollars, and with programs as they come and go, we’ll keep an eye on that,” Eng said. “We’re going to be really good about making tough decisions on which grants to go after. We have a lot of good work that qualifies, and I have a great team that’s working hard on these submissions.”
Still, he acknowledged that the T might face some impacts.
“We’re going to have to be nimble. We’re going to have to make tough decisions if certain projects are not fully funded. But you know, even in good times when federal dollars are flowing, we’re not always guaranteed to win these grants,” he said. “It’s a competitive, very competitive nature, and in the back of our minds, we’re always thinking, ‘If we don’t win this grant, or we don’t win as much as we asked for, how do we deliver that?'”
While the T had just enough new Orange Line cars from CRRC to fully replace the line’s decrepit rolling stock in 2022, its Red Line subway is still soldiering on with cars that are between 35 and 55 years old. The agency recently announced those cars are becoming so maintenance-intensive that it will have to run shorter trains on occasions when too many are in the shop, in order to keep frequencies up.