Hyundai Rotem has been confirmed to be participating in the bid for the tram (a streetcar that operates on rails installed as part of the road) project in Jerusalem, Israel. The Israeli government had pursued a contract with the Changchun Railway Vehicle (CRRC) of China, but the contract fell through recently due to CRRC being blacklisted by the Ministry of National Defense of the United States. Analysts in the industry suggest that Hyundai Rotem may benefit from the spillover effects of the U.S.-China conflict.
According to the railway specialist media Railwaysupply, the Israeli Ministry of Finance halted the contract with the Jtrain consortium and CRRC just before it was signed on the 11th. CRRC's inclusion on the U.S. Ministry of National Defense's blacklist for the past two years appears to have raised concerns in Israeli political circles. The Jtrain consortium holds the rights for the Blue Line tram project in Jerusalem.
Hyundai Rotem's Rail Solutions Division had proposed a contract to the Jtrain consortium last year. The contract size for this project is $2 billion (approximately 2.8 trillion won). In addition to the Blue Line, there are also the Red Line and Green Line trams in Jerusalem.
Hyundai Rotem is expanding its business by winning a project for the supply of double-decker electric trains worth 2.2027 trillion won in Morocco last February. Last year, the Rail Solutions Division of Hyundai Rotem generated revenues of 1.4956 trillion won, accounting for 34% of the total sales (4.3766 trillion won). The order backlog in the railway sector reflecting ongoing deliveries stands at 8.963 trillion won.
CRRC is facing disruptions in its business in several countries, including the United States. CRRC was selected as the new railroad design firm for New York City during the first administration of Donald Trump in 2019, but then-Senate Majority Leader Chuck Schumer called for a federal investigation into whether the project posed a threat to national security, requesting a review from the U.S. Department of Commerce. Subsequently, a bill was introduced prohibiting the purchase of railroads and other products made by companies receiving or owned by the Chinese government.
CRRC participated in the Moroccan project awarded to Hyundai Rotem but was eliminated midway.