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In March Of 2018, MTA Selected 8 Winners Of An “MTA Genius Transit Challenge”— One Of Those Winners Happened To Be A Chinese State-Owned Enterprise, CRRC; Despite Having No Existing Contract, CRRC Dumped $50 Million Of Its “Own Money” To Win & Develop A New Subway Car For MTA & NYC Transit

Chinese Company Is Touted For Installation Of “Modern Train Control Tech” That Schumer Says—Especially Now—Demands Immediate Review By Commerce Dept.; Feds Must Help MTA & Others Determine Any Risks Like Hacking, Vulnerability To Cyber-Warfare & More

Schumer: Mass Transit Tech Is More And More Susceptible To Nefarious Acts; Feds Must Ensure U.S. Transit Agencies — Like The MTA – Are Never Compromised   

Amidst rising trade tensions with China, an ever-increasing threat of cyberattacks, and a new White House order that restricts Chinese firms from business operations in the United States because of national security concerns, U.S. Senator Charles Schumer demanded, today, that the U.S. Department of Commerce thoroughly investigate a Chinese State-Owned firm, CRRC, working with the Metropolitan Transportation Authority (MTA). Schumer said the Chinese State-owned company has an aim to install new tech in the New York subway system and that the feds must determine any threat this might pose to the MTA and its commuters. Schumer also said Commerce must help other cities’ mass transit systems already knee-deep in business with CRRC, including Los Angeles, Chicago, Philadelphia and Boston.

“Given what we know about how cyberwarfare works, and recent attacks that have hit transportation and infrastructure hubs across the country, the Department of Commerce must give the green light and thoroughly check any proposals or work China’s CRRC does on behalf of the New York subway system, including our signals, Wi-Fi and more,” said U.S. Senator Charles Schumer.

China’s CRRC, the state-owned railway corporation, is building rail cars for some of America’s biggest cities. Citing CRRC contracts in America’s big cities, like Los Angeles, Chicago, Philadelphia and Boston; as well as new partnerships with cities like Washington and New York City, Schumer says the Department of Commerce must investigate whether CRRC’s technology and involvement poses a threat to the MTA and the other U.S. mass transit systems across the country. 

“This kind of national security responsibility is just so big, and so complex, that the MTA and other big-city transit systems should not have to foot the burden of going at it alone to assess whether or not CRRC’s low bids for work, and current contracts across the country, are part of some larger strategy. We just cannot be too careful here, especially now, amidst these tensions and general cyber threats,” Schumer added.

The state-owned China Railway Rolling Stock Corp. (CRRC) has already been awarded contracts to build rail cars for some of the biggest cities in the U.S., including Boston, Chicago, Los Angeles and Philadelphia. Many argue that the company has been able to secure such deals by significantly underbidding competitors with the help of subsidies from the Chinese government. Currently, CRRC is pursuing a $500 million Washington D.C. metro car contract while keeping its eyes on New York in pursuit of  a roughly $4 billion contract with the MTA.

On May 23, 2017, the State announced that the MTA would launch the “MTA Genius Transit Challenge,” a grant program that challenged companies and individuals to develop innovative solutions to improve New York City’s subway system. On March 9, 2018, MTA announced that China’s CRRC was one of the winners of that grant program, as the company invested $50 million of ‘its own funds’ to develop a new subway car for MTA’s transit system, despite the absence of any current or ongoing procurements. This railcar would include modern train control technology, Wi-Fi, and other systems that could be susceptible to cyber-attacks, hacking, or left vulnerable to backdoors in key systems, according to the MTA.

After winning the MTA challenge, CRRC said, “We are honored and excited to have been chosen for the MTA’s Genius Transit Challenge. We look forward to introducing CRRC’s design philosophy focused on accelerating the pace subway vehicles are procured and deployed to the New York transit system."

According to Stateline, an initiative of The Pew Charitable Trusts, in 2018, state and local government agencies have become increasingly susceptible to cyberattacks -- especially in the public transportation sector. In 2016, the public transit system in San Francisco endured a ransomware attack from hackers who demanded $70,000. The Sacramento Regional Transit was hit with a similar attack the following year. In 2018, the Colorado Department of Transportation was forced to shut down 2,000 computers following two ransomware attacks. Security officials and experts have pointed to China as a possible source of these attacks.

In light of the growing cybersecurity threats to public transit systems in the U.S., Schumer says it is particularly alarming that CRRC is so broadly winning contracts that provide intimate access to U.S. transit systems. He says CRRC’s involvement in the operations of the NYC Subway System demand the Department of Commerce fully examine –from top-to-bottom--the impact such involvement can have on America’s and New York’s vibrant rail supply sector, which in New York alone contributes over $3 billion in GDP to the state’s economy every year and supports over 5,000 jobs.

Schumer says, a now-deleted tweet posted by CRRC, lays out the concerns perfectly. It read: “So far 83% of all rail products in the world are operated by #CRRC or are CRRC ones. How long will it take for us conquering the remaining 17%?”