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China high-speed fusion?

October 28, 2014

China's top two train producers have been reported to be in merger talks in a bid to halt their unproductive rivalry and compete better with Western companies. Exporting Chinese technology is seen as key.

A Chinese high-speed train
Image: picture-alliance/dpa

China's top train makers, CNR and CSR, are currently engaged in merger talks, state media reported Tuesday.

The official China Securities Journal claimed the firms had already set up working groups to discuss the details of the integration, which aimed at creating a giant able to compete globally with the likes of Germany's Siemens and Canada's Bombardier.

The two Chinese companies have been fierce rivals in selling their technology abroad, and analysts have argued a merger would enable them to profit from a joint technology base.

Moving fast

China succeeded in building the world's longest high-speed train network in less than a decade. Its leading train producers have frequently voiced their desire to become a larger technology exporter. CSR, for its part, said at Germany's Innotrans railway technology fair in mid-September that it was aiming to boost its activities on the European market.

A merged CNR-CSR would have combined annual revenue of $32.7 billion (25.7 billion euros), based on 2013 company data.

Eco-friendly transport in China

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Profiting from an 80-billion-euro government investment program this year, the two companies are expected to produce about 300 new high-speed trains annually. According to German news agency dpa, that is more than Deutsche Bahn's total ICE rolling stock.

hg/cjc (dpa, AFP)

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