Gordon Campbell on Kiwirail’s Chinese-built wagon problems

For many people, Kiwirail’s decision to buy 500 flat top wagons from manufacturers in China instead of building them at Hillside workshops in Dunedin was a classic case of New Zealand chasing short term cost savings from overseas providers at the expense of many local jobs, the development of manufacturing expertise in this country and the related flow-on economic benefits to the wider community. In recent weeks, the issue of the $49 million rail wagon contract has risen again – this time over news that the Chinese-built wagons are already requiring repairs at a rate significantly higher than normal.

Earlier this week, I asked Kiwirail CEO Jim Quinn to update what the precise figures for the repair list were, and what is known about the causes. “We currently have a total of 46 IAB container wagons (made in China) out of the total fleet of 500 under repair or undergoing maintenance in maintenance depots around the country, “ Quinn replied. “This represents 9% of the total fleet. With normal operations we always plan for at least five percent of a fleet of wagons to be either under repair or undergoing normal maintenance. This is normal practice for rail operations worldwide as the rolling stock is working 24/7. In other words we have a less than 4% increase in what is normal.” [In fact, 46 out of 500 is 9.2%, so the increase is slightly more than 4 %. Moreover, if a 5% level is to be taken as the norm, then at 9.2%, the repairs on the Chinese-built wagons are running at almost twice the normal rate.]

The cause of these breakdowns remains something of a mystery. To me, Quinn indicated that the problem is “wheel skid,” with the cause as yet unknown. “There hasn’t been a systemic failure with these wagons, rather there is a specific wheel skid issue in 20 [18 of these wagons are currently being held in Christchurch] of these wagons for which the cause has not yet been fully diagnosed. It could be operational (eg handbrakes being left on) or a mechanical issue. Once we know the cause we will implement the appropriate response. In terms of the diagnosis – what we do know so far is that in the majority of cases the wheel skid issue is only happening on the bogie (wheel) with the handbrake on it and it is almost impossible to skid wheels on only one bogie unless it is due to the handbrake being left on. We have not found an example of any other possible cause would have caused the skid on the reviewed wagons to date.”

Right. So it could be an operational failure to check whether the handbrake has been released, or a mechanical failure – or a mixture of the two. Wayne Butson, general secretary of the Rail and Maritime Transport Union explained to me how the wheel skid damage appears to be occurring: “The hand brake mechanism on the new Chinese wagons are different to any other handbrake. You turn the handbrake like a wheel to turn it on and then there’s a lever you pull to release the handbrake. What they’ve found is that when you pull the lever sometimes the handbrake still doesn’t release, so the wheels stay locked up and the wheels get dragged along the track… and the wheels go flat.” As Butson readily concedes, some of the earlier wagon prototypes built at Hillside share the same problem – “They started building them [at Hillside] and they optimised the design – and once they had it right, that’s when they sent it over to China and got it built…”

The solution, as Quinn indicates, may require a technical fix – presumably one focussed on the linkages between the lever release and the handbrake - or an operational one. An operational fix would require a double check to ensure that the lever release had, in fact, released the handbrake as expected – and if not, this would then have to be released manually. The more interesting point is that no one appears to know what is causing the problem.

Furthermore, by my calculations, the wheel skid problem accounts for only 43.5% of the wagons currently in for repair. More than half are in the repair shop for some other reason – presumably for wear and tear, inadequate welds etc. Again, this mix of problems is unspecified. As Quinn maintains. there hasn’t been “a systemic failure” with these wagons and Kiwirail continues to be “very pleased” with their performance, but the failure to diagnose the reasons for their current malfunctions is troubling – given that the wheel skid problem alone appears to be pushing the incidence of damaged wagons out of service up to nearly double the normal rate.

There is an added issue, equally mysterious. Butson points out that the design of these wagons included a slight curvature in the middle – a bend in the steel designed to straighten as the wagon is filled, allowing the ends to be locked off. This isn’t happening as expected, Butson says, at a higher rate with the Chinese built wagons. “What the troops are finding is that they’re having real difficulty loading and unloading the wagons. So if you were dropping a 40 foot container on a Chinese wagon... the centre of the 40 foot container sags below the end of the container, as its sagging with the weight. Two fat bellies meeting in the middle means there’s a problem at the ends. So what they have to do is force boxes onto the wagons and so on, and then they smash hell out of the twist locks trying to get them to lock in at the ends. “

As yet, Kiwirail’s Jim Quinn says. there have been no indications that this particular problem with the Chinese-built wagons is resulting in damage to the containers. “There [have] been no reports of container damage as a result of being used on these wagons.” However, Quinn confirmed that the problem exists, and that the cause of it remains as yet unknown. “One issue that has been discovered in only a couple of these wagons is when loading some empty (or light) 40 foot containers, they can’t be fastened. We are working with the Chinese supplier on what could be causing this.”

For his part, Butson can’t say whether the quality of the steel on the Chinese built wagons may be a contributing factor. “No one can tell me whether there is a difference between the metal specifications on the Chinese wagons versus the Hillside ones. But in practical terms I’m told the Hillside ones are easier to load.” Quinn is adamant on this point : “The Chinese wagons have been built using a higher grade of steel than those constructed at Hillside.”

In sum, if Kiwirail is still largely in the dark as to what is causing (a) the wheel skid problem and (b) the locking off of the wagons problem, the ability to seek redress under the contract would appear to be limited. As yet, ‘total systematic failure’ of the Chinese built wagons is not happening. Yet the current rate at which the wagons are turning up in the repair shop is hardly a ringing endorsement of the policy of getting cheap foreign providers to build the key items in our transport infrastructure.

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