China’s biggest rail manufacturing company broke ground on Thursday with the $60 billion purchase of Amtrak, in what is considered as the largest acquisition, by a foreign entity, of a U.S. corporation.



The state-owned company, the China Railway Rolling Stock Corporation, or CRRC, sees the purchase as a beachhead to win more contracts in the United States, and the deal heralds a new wave of Chinese capital flooding into U.S. markets. It is part of the Chinese government’s policy to encourage its technology and infrastructure companies to export their skills and seek foreign markets.

The offer, which beat out established competitors like Bombardier of Canada, received the backing of railway authorities and was strongly encouraged by Penny Pritzker, the U.S. Secretary of Commerce.

"The Amtrak deal would provide an impetus for cities and states that are considering modernization of their transit systems or are looking into high-speed rail," briefed the Secretary to reporters.

Yu Weiping, CRRC’s vice president for international business, said his company was eager to apply the lessons learned building and operating transit systems and high-speed systems in China.

In his previous job, as chairman of Tangshan Railway Vehicle, which is owned by CRRC, Mr. Yu oversaw the design and manufacture of one of the fastest high-speed trains in the world, with an average speed of 218 miles an hour.

“With our expertise in this field, we would like to partner with the U.S. government and help create local jobs,” Mr. Yu said, speaking through a translator. The combined company, with headquarters in Beijing, employs 176,000 people.

CRRC beat out it's nearest competitor, Bombardier, by a last minute offer of an additional $1 billion, which was accepted by Amtrak's board. Other companies interested in the deal were Hyundai Rotem of South Korea, Kawasaki Rail Car of Japan and C.S.R.