1. Maintain the Trilateral USMCA Framework.
The North American rail sector depends on preserving the existing three-nation agreement. This framework provides for the needs of the continent’s integrated rail network and avoids breaking it into separate bilateral deals that put U.S. manufacturers and suppliers at a disadvantage, or risks disrupting supply chain resiliency.
2. Protect the Current Railcar Exemption.
The current framework, as seen through Chapter 86 of the Harmonized Tariff Schedule through the NAFTA Implementation Act of 1993 (and the 2020 USMCA re-negotiation) recognizes that a healthy U.S. railcar manufacturing base is vital for the North American freight rail interchange system, which in turn is critical for our economic security. Keeping freight railcars and rolling stock exempt from tariffs that negate the USMCA railcar exemption will help ensure cross-border efficiency and preserve manufacturing competitiveness. Any effort to alter that treatment could inadvertently create new barriers and costs within an industry that already operates at world-leading standards for security and transparency.
3. Extend U.S. Rail Security Standards Across North America.
Given the successful implementation of laws like TIVSA and the SAFE TRAINS Act to block Chinese state-owned enterprises from threatening the domestic rail sector, the USMCA Joint Review should encourage extending these safeguards throughout the North American rail sector to align with the U.S. for continent-wide security.
4. Strengthen Industrial Security Coordination.
As a $35 billion state-backed conglomerate that has benefited from an estimated $2.6 billion in direct government subsidies from the Chinese government (2014-2024), CRRC is able to underbid and undercut market-based competitors consistently. Maintaining free trade among North American allies but erecting high barriers to unfairly traded imports from non-market economies, should be a core part of the USMCA Joint Review. Doing so will establish a united front against Chinese entities that rely on state subsidies to take over industries, distort markets, and threaten national and economic security in the U.S. and in Canada and Mexico.