Japan enters high-speed train sales race

[December 16, 2009]  NAGOYA, Japan (AP) -- On a desolate stretch of track just before midnight, when all passenger lines have been put to bed, a juiced-up Japanese bullet train goes online and accelerates to over 200 miles per hour. The 700-ton train, about a quarter of a mile long, whooshes by rice paddies in under five seconds.

There are no locals around to witness the train glide to a stop at a deserted Kyoto Station, but that's not the point. This is an accelerated sales pitch aimed squarely at the U.S., where Japan is competing with European train makers for a new high-speed train network that could deliver contracts worth hundreds of billions.

Diplomats, business leaders and journalists were crammed in to watch special speedometers record the feat last month, the first time operator Japan Central Railway Co. has allowed outsiders to join a test run. Rivals abroad said Japanese trains weren't up to spec, and JR Central wanted to set the record straight.

"In France and Germany they have been saying we can only do 280 kilometers (170 miles) per hour, so we had to demonstrate," says company chairman Yoshiyuki Kasai.

That Japan's bottle-nosed bullet trains -- known here as the "shinkansen" -- can hold their own against overseas models has long been a point of pride. But now a massive sales race is underway. While the majority of services to date have been built in Europe, where makers like France's Alstom and Germany's Siemens dominate, governments around the world are looking to upgrade as existing lines age.

A diverse group of countries is at various stages of introducing super trains, including Russia, the U.K., Vietnam and Brazil, but the U.S. is the ultimate prize.

President Barack Obama's stimulus package included an $8 billion provision for high-speed trains, and some say eventually $600 billion will be needed for a nationwide network. Japan's exports to the U.S. last year totaled about $140 billion.

A high speed network would drastically cut U.S. train times. The Washington to New York route would drop from two and half hours to about 70 minutes, according to Kasai. That would create a viable alternative to planes and cars, cutting down on traffic and depositing travelers at stations that are often in the city center.

Some analysts question whether cash-strapped Washington can afford to follow up the initial provision with more funds. But building new train lines can also be a vote winner, hitting political touchstones like jobs and reduced pollution.

JR Central, one of the operators created when Japan privatized its railways in 1987, is leading the charge in the U.S., but is also taking a risky winner-takes-all approach. The company is pitching a total package covering everything from train cars to signals to maintenance machinery and even employee instruction -- even though many in the industry prefer to rely on a variety of suppliers.

Few countries have the technology to safely move passengers and hundreds of tons of train so swiftly.

Japan was an early innovator, launching services in 1964 to coincide with the Tokyo Olympics. Rivals with more experience at exporting include Alstom, a world leader by market share, and Siemens, which already has a light rail factory in Sacramento. Both have 200 mph trains in Europe and have said they will pursue the rail dollars from Washington.

Japan is hoping its close political ties to the U.S. will give its sales pitch a boost. When Obama visited Tokyo last month, Japanese leader Yukio Hatoyama highlighted Japanese trains and handed over promotional DVDs.

The country has had some success abroad. Earlier this week the U.K. launched its first high-speed service using trains made by Hitachi. In Vietnam, a major recipient of Japanese government financial assistance, officials have said they want to use Japan's technology for a new train network that may include high-speed services.

JR Central runs high-speed services on the prized routes from Tokyo to Kyoto and Osaka, and designs and operates its own fleet. Bullet trains built by the company are currently used in a high-speed network in Taiwan, the first time they were sold abroad.

But that $18 billion project combines the Japanese train cars with technologies from other countries, a hodgepodge solution that JR Central wants to avoid in the U.S., because it means modifying proven technologies and a smaller paycheck.

"This is not a system that can be divided up into parts, and we are proposing adoption of the entire system," said Tsutomu Morimura, an executive in charge of JR Central's technology division.

Morimura says this is the only way to employ the company's advanced technology and guarantee a safe and efficient system. Rail experts agree that Japan's train tech is among the best in the world, but wonder whether an all-or-nothing approach will work in the U.S.

"If you rely totally and completely on a single country, when a problem arises there is a lot of risk, so the fundamental stance of many buyers is not to rely on the technology from one country," said Credit Suisse analyst Osuke Itazaki.

Robert Eckels, chairman of the Texas High Speed Rail Corp. that works to bring such a system to the state, was present at the demonstration in Japan. He was impressed but wasn't sure how the company's all-in-one pitch would play out in the states.

Unlike in Europe, where border crossings and ensuring compatibility on differing rail networks are prerequisites for doing business, Japan's trains have been developed on an island, with homebrew technology. Other Japanese industries with enviable but non-compatible technologies, like its mobile phone operators, haven't fared well in repeated attempts to go abroad.

Another wrinkle: Japan's high-speed trains run on their own tracks, with no crossings and dedicated bridges over crowded areas. Building such lines from scratch in the U.S. would be costly, but executives like Morimura say it's an advantage to be unconstrained by the standards of conventional networks.

Bullet trains do have an impressive history. No passengers have died from a derailment or collision in nearly a half century of service, with the only derailment during a major earthquake in 2004. The average delay for JR Central services each year, despite hundreds of trains each day, is typically less than a minute.

For Japan, billions in contracts would be a welcome boost as the economy begins to recover from recession, and help stir national pride. The "shinkansen" are a symbol of the country's technological prowess here, where services have names like "Hope" and "Light," and miniature replicas are popular among children.

When one of the original trains was retired and put on display at a museum on the outskirts of Tokyo earlier this year, some 16,000 visitors crammed in during the first week to take pictures and rub its elongated nose.

[Associated Press; By JAY ALABASTER]

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