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Chicago manufacturers are banking on a new law for high-speed train parts
High-speed rail’s slow emergence in Chicago is prompting innovations at little-known local suppliers who only recently gained the upper hand in competing with offshore companies that have had an easier time declaring their goods “Made in America.”
A rail supply-chain report shows as many as 460 companies within a few hours’ drive of Chicago could snag a piece of the proposed Chicago-to-St. Louis high-speed train project. Trains now run at 110 mph on a 15-mile stretch from Dwight to Pontiac. Plans call for high-speed travel on 75 percent of the route, from Dwight to Alton, by 2015, says Rick Harnish, executive director of the Midwest High Speed Rail Association.
One local company standing to benefit is custom-rail passenger seating company Kustom Seating Unlimited Inc., of west suburban Bellwood.
The 25-year-old privately held company holds a majority share of the rail-transit seating market in North America, employs about 120, and generates another two to three more local jobs for each of its suppliers’ workers.
Kustom Seating and other local companies are poised to take advantage of a new federal rule that upped the percentage of major components in high-speed rail projects required to be made in the United States to 100 percent from 60 percent.
The Federal Railroad Administration, which allocates funding for high-speed rail projects nationwide, will oversee the 100-percent requirement aimed at ensuring U.S.-based permanent manufacturing, rather than short-term assembly, of the major components. The new rules took effect in the fall.
Robert H. “Bobby” Doyle, a senior transit industry consultant in Chicago, says Kustom Seating and others will no longer have to watch foreign companies lease a building for a short period to put together parts and then disappear.
“The situation was not fair,” Doyle said.
Illinois is already benefiting as the “Buy America” requirement played a role in Nippon Sharyo’s $54 million plant expansion in northwest suburban Rochelle, announced April 30. The expansion is expected to create 200 construction jobs and 80 permanent jobs.
Kustom Seating has survived to see the change after transitioning with the up-and-down rail industry. In the past decade, it evolved from a cushion and upholstery aftermarket supplier to a seat designer and developer that contracts with the world’s largest train manufacturers, including Alstom, Ansaldobreda, Bombardier, CAF, Kawasaki, Kinkisharyo, Nippon Sharyo and Siemens.
Kustom Seating produces most of Amtrak’s seats, including those on high-speed trains from Washington, D.C., to Boston, and will outfit new Chicago Transit Authority rail cars from Bombardier and new Metra cars from Nippon Sharyo, the latter being built in Rochelle.
Kustom Seating employs the entire line of skilled workers needed to make the seats: engineers, supervisors, welders, sewers and assemblers.
To stay ahead of the market, the company runs an innovation lab that uses computer analysis, dynamic testing and a variety of materials to meet safety standards. The seats must be safe while staying lightweight, ergonomically correct and aesthetically pleasing.
Another local transit seat manufacturer, 120-year-old Freedman Seating in the Humboldt Park neighborhood, aims to win high-speed rail market share too.
Seats for railroads accounted for 1 percent of Freedman’s $80 million in 2012 revenues, but the company’s recent partnership with Spanish seating company Fainsa is aimed at increasing that business.
The goal is for Freedman to leverage Fainsa’s railroad experience and sleek European seat designs and aesthetics to win new rail business, including high-speed rail.
“Europe is farther along in designing thinner-profile seats so that a rail car looks more spacious,” said Sudha Veerapaneni, Freedman’s new business development manager.
At the same time, Fainsa can win new rail business in the United States by meeting requirements that it manufacture its designs here.
Freedman employs 600 at its Chicago plant.
The two companies already make lighter-weight seats required of high-speed trains by replacing the carbon steel of bygone days with materials such as aluminum and magnesium.
“The design of rail cars is at an inflection point,” Veerapaneni said. “Plenty of today’s seat designs are 20 to 30 years old, and new rail cars require lighter weights at the same time.”