Chinese railcar manufacturer CRRC Sifang America broke ground on Thursday in Chicago at a $100 million plant that will build railcars for the city's transit authority and become the company's North American hub for the assembly of railcars.

In 2016, CRRC Sifang, a unit of China Railway Rolling Stock Corp, was awarded a $1.3 billion contract by the Chicago Transit Authority (CTA) to supply more than 840 new railcars to replace approximately half of the agency's fleet. As part of the contract, the company agreed to make the railcars in Chicago.

In addition to fulfilling the CTA contract, the plant will give the company a foothold in North America to assemble railcars and, potentially, high-speed trains, CRRC officials said.

The 380,944-square-foot railcar manufacturing plant will be on 45 acres (18.2 hectares) in Chicago's Hegewisch neighborhood on the Southeast Side, the first of its kind in the city in 35 years. The factory will employ roughly 170 workers - the majority of them union, high-skilled, sheet metal and electrical workers - and create almost 130 other construction jobs. CRRC Sifang America will spend $7 million to train the factory workers, according to a statement from Chicago Mayor Rahm Emanuel's office.

CRRC Corporation Vice-President Sun Yongcai said: "CRRC Sifang America is grateful for the opportunity to work with the Chicago Transit Authority to produce the next generation of railcars in Chicago, for Chicago. We are committed to producing top-of-the-line railcars to enhance CTA rider experience, while also creating new jobs at our assembly facility in the city."

Emanuel said the plant represents a major investment in Chicago that will bring economic development to the Southeast Side, while creating well-paid jobs.

He said: "The railcars that emerge from this facility will be the latest step we have taken to invest in world-class transportation, and to create a 21st-century transit system."

Production will begin in early 2019, and after testing the cars are expected by 2020. The new cars will replace the CTA's oldest rail cars, which date back more than 30 years, officials said.

It will be CRRC's second plant in the US. Construction began on a $95 million plant in Springfield, Massachusetts, in 2015 to build railcars for Boston's transportation agency. Completion of that plant is scheduled for this year, and the first cars from that plant are expected to be delivered to Boston in 2018.

Train-makers CSR Corp and China CNR Corp were combined to form CRRC in 2015 to better compete in overseas markets.

paulwelitzkin@chinadailyusa.com