Last week, in Beijing, I met with Ulf Henriksson, the chief executive of Invensys, and chatted about China’s high-speed rail plans. Invensys manufactures the control systems for trains and has a partnership with China Southern Rail. Mr Henriksson said his systems were so advanced they could tell how many people were in each carriage and adjust the power of the train accordingly.
High-speed rail is under scrutiny again in China, with opponents saying that the enormous cost of the lines will never be made back in ticket sales. Those in favour point out that transferring people onto high-speed trains frees up ordinary lines to haul freight, and that there has been a 13% increase in coal deliveries this year, helping to keep prices down as we move into winter.
Mr Henriksson believes that if a country can afford to buy high-speed rail, its returns on investment are "very high". He said: "At the moment if you go on a high-speed train, you do not see your average Joe. So it has not been an investment for the majority of people right now. But the question is: will that be different in five years?"
"Over time, it will prove its worth. Look at Spain, which is the last country to go high-speed. I don’t hear criticism there. I hear about how pleased they are. I don’t think France or Germany are going to go back to normal lines either. They would never consider it. And if American consumers could just imagine what it would be like without commuter airlines, coming into the middle of the city, how you can work on the train and not be all crammed, well, they will change too," he said.
Part of the reason behind the development of high-speed rail in China is strategic, with China hoping to sell its new expertise abroad. But Mr Henriksson says that so far they have not found any buyers. "Have I see Chinese bidders around the world? Absolutely," he said. "But they have not been as successful as they would like to be, and I think our relationship may help solve some of those problems," he said.
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