Wowjoint Holdings Limited ("Wowjoint," or the "Company") (Nasdaq: BWOW, BWOWU, BWOWW), China's innovative infrastructure solutions provider of customized heavy duty lifting and carrying machinery, today announced that it has entered into a contract for leasing and servicing  the construction of high speed rail in China.
Wowjoint entered into a contract with a subsidiary of China Railway Group, Beijing-Fujian Railway Section VI Project Department of China Railway Tunnel Stock Co., Ltd. ("China Railway"), for the lease and servicing of a special launching carrier. This special launching carrier will be used in the construction of the Beijing-Fuzhou passenger high speed railway line. Wowjoint will lease to China Railway a 900 ton special launching carrier specifically designed for this project to pass through the tunnels and install approximately 146 spans of railway box beams. The contract value is approximately $2.7 million and the service is scheduled to be performed from November 2012 to September 2013.
"We continue to pursue our leasing and servicing business where we operate the machines for our customers. We are pleased with our newest contract with China Railway." stated Mr. Yabin Liu, Chief Executive Officer of Wowjoint. "This is our second service contract this year and we anticipate these types of contracts to continue as we enter the subcontracting/servicing field. In this project, the launching carrier is required to pass through over 20 tunnels.  Our special launching carrier is patented and is the only launching carrier in China today that can go through the tunnels and place box beam segments. We think this is one of the reasons why Wowjoint was selected to be the provider for this project. We believe our servicing business will continue to expand as a profitable business segment of the Company."
 

Global track market remains steady despite continuing economic uncertainty 

China will increase railway fix-asset investment (FAI) in 2013, with plans to surpass the US$100.91 billion (RMB630 billion) spent on rail lines this year, Caixin reported. A spokesman for the Ministry of Railways said that investment in railway infrastructure alone will be more than US$80.09 billion next year. Increased investment in railways will continue until 2015, he said. Since June, the ministry has increased the FAI spending target four times. During the first 10 months of this year, China spent US$68.11 billion on railway FAI, 0.9% less than the same period in 2011. Investment jumped in October with total FAI hitting US$13.13 billion and railway infrastructure outlays reaching US$11.18 billion, up 240% year-on-year. About US$32.81 billion of this year's railway budget remains unspent, and further investment is expected during November and December.
 

Railway and energy experts called Wednesday for the establishment of an effective system to protect the interests of private investors as they enter State-dominated sectors. The request comes as construction begins on new railway and energy projects which are partially funded by private capital.

"In the new coal transportation railway project, for the first time China's railways ministry does not hold the controlling stake of 50 percent. Instead they hold around 20 percent, to allow more private investors to participate," Wang Mengshu, chief engineer of the China Railway Tunnel Group and member of the Chinese Academy of Engineering, told the Global Times Wednesday.

"But for such a large project, it would take a long time, say 12 or 13 years, to recover the investment. Whether investors could profit depends on the operating efficiency of the project. Protecting the interest of private investors in State-dominated sectors is an issue that has yet to be solved," he said.

The Ministry of Railways (MOR) announced Tuesday that construction has begun on the Mengxi-Huazhong coal transportation railway (the West Inner Mongolia-Central China Railway), a 1,750-kilometer railroad connecting Central China with key coal-producing regions including Inner Mongolia and Shaanxi. Part of the project is expected to be completed in 2015.

Investment in the project is estimated at 170 billion yuan ($27.117 billion), of which the railways ministry contributed 20 percent. The remaining 80 percent came from local governments and other enterprises, including 15.7 percent from private capital, the MOR said in a statement sent to the Global Times Wednesday.

A total of 11 companies invested in the project, including China Shenhua Energy Company, China Coal Energy Company and Shaanxi Coal Industry Company.

Zhou Dongzhou, Secretary of the Board of China Coal Energy Company, told the Global Times Wednesday that the company holds a 10 percent stake in the project but said it was hard to predict returns at this stage.

Meanwhile, the China National Petroleum Corporation (CNPC) announced Tuesday that construction had begun on the country's third pipeline transporting natural gas from the country's resource-rich western regions to the energy-deficient eastern regions.

Total investment in the project is 125 billion yuan, with completion slated for 2015, the CNPC said.

The project is open to private capital. China's Social Security Fund, Urban Infrastructure Construction Investment Fund and Baosteel have agreed to jointly invest in the project and the CNPC holds a controlling stake.

The CNPC did not say what portion of the project is funded by private capital. According to a report by the Economic Information Daily, Urban Infrastructure Construction Investment Fund holds a 16 percent stake in the project.

"The project set a precedent for introducing private capital into the country's State-dominated energy sector, but the room for private capital in such energy projects is still very limited," said Li Lingxuan, an analyst with Shandong-based industry research agency SCI.

The private investment comes in the form of funds that can only participate by paying for supporting components, whereas the supply of major construction materials such as pipes and steel will still be dominated by State-owned companies, Li said.

Zambia Railway Authority (Tazara) has signed a $US 42m agreement with the Chinese government that will enable Chinese companies to implement rehabilitation projects on the ailing railway.

According to a statement released by Tazara, the agreement was concluded by Tazara managing director Mr Akashambatwa Mbikusita-Lewanika and China's chief representative for economic and commercial cooperation, Mr Lin Zhiyong.

The deal concerns 12 separate projects, including the modernisation of 42 passenger coaches, the supply of four new mainline locomotives, two diesel shunting locomotives, 30,000 wooden sleepers, track maintenance vehicles, and components. Tazara says Chinese consultants will also provide staff training.

The work is being financed by China through a $US 66.2m loan and grant agreement signed earlier this year.

Mbikusita-Lewanika says funds provided by China to the Tanzanian and Zambian governments under 15 different protocols will keep the railway in operation over the next three years while the two African governments complete a desperately-needed programme of recapitalisation, reconstruction and restructuring.

Tazara has received regular financial support from the Chinese government in the form of interest-free loans dubbed 'protocols of economic and technical cooperation.' Once completed, the projects in the 14th and 15th protocols will bring much-needed additional capacity, doubling the number of locomotives in service by 2015.

THE first container train with a CIM/SMGS common consignment note was despatched by Russian Railways Logistics (RZDL) in cooperation with its Chinese subsidiary YuXinOu Logistics on October 31.

The train, which left Chongqing, China, destined for Poland and Germany, was carrying 42 40ft containers for various customers. Kaztransservice, Kazakhstan, and Belintertrans, Belarus were also involved in the inaugural service as RZDL's transit partners.

"Introduction of CIM/SMGS common consignment note is a result of two years of work by the railways of all the transit countries involved," says Mr Pavel Sokolov, CEO of RZDL. "Shippers save time due to the reduction of container demurrage at border stations."

The system will also save money. The client is usually charged for re-issuing the CIM consignment note in place of SMGS note for each shipment at border stations. The introduction of the CIM/SMGS common consignment note will eliminate these extra payments.

The common consignment note is a customs document which is issued in both paper and electronic form according to European Union requirements for prior authorisation.

The Shanghai and Shenzhen stock markets registered slight increases Tuesday mainly due to strong gains in banking and real estate stocks.

The Shanghai Composite Index edged up 13.23 points, or 0.62 percent, to close at 2,161.19; while the Shenzhen Component Index advanced 19.14 points, or 0.20 percent, to end at 9,560.03.

Both indices opened lower Tuesday due to overnight contractions in US and European markets. The Shanghai Composite Index declined to an intra-day low of 2,141.48 point mark in the morning session. An afternoon rally in the heavily weighted securities, real estate, banking, automobile, cement and coal sectors helped the index finish the day in positive territory.

The Anhui Development and Reform Commission disclosed that the Ministry of Railways would invest 37 billion yuan ($5.81 billion) more in railway infrastructure construction this year in order to boost the rail industry, according to a report by the National Business Daily Tuesday.

This news helped Shanghai-listed China Railway Group tack on 2.34 percent to 2.62 yuan. China Railway Construction advanced 3.10 percent to 4.65 yuan.

The first RMB qualified foreign institutional investor (RQFII) A-share exchange traded fund (ETF), the ChinaAMC CSI 300 Index ETF, started trading at the Hong Kong stock exchange Tuesday, and could inject nearly 5 billion yuan into the domestic markets, according to the Shanghai Securities News Tuesday.

Positive reports about the ETF and hopes that the government would soon roll out favorable policies to spur economic growth helped lift market sentiment Tuesday, say analysts.

According to sources from CSR Ziyang Locomotive Co., Ltd. CSR Ziyang on October 18, China’s first hybrid AC-driven shunting locomotive, independently developed by the enterprise, has recently passed Sichuan’s technological achievement appraisal. According to the appraisal, the locomotive has filled a gap in the domestic hybrid locomotive field, and is up to advanced international standards among similar products. 
　
Hybrid locomotives are railway locomotives that borrow the concept of hybrid vehicles, and power traction motors through the diesel generator set or the battery pack in a separate or combined manner. Due to low fuel consumption and low emission, hybrid buses are hailed as “green” locomotives. In March 2009, CSR Ziyang, in association with entities including CSR Zhuzhou Institute Co., Ltd. and CSR Chengdu Co., Ltd., launched the R & D of China’s first hybrid locomotive. During R & D, on the basis of fully borrowing the existing hybrid vehicle design concepts and technologies in the world, according to the operation characteristics of China’s shunting locomotives for industrial and mining purposes, the entities massively assimilated the advanced design concept of “Harmony” six-axis large-power electric locomotive, and used CSR’s independent “AC-DC-AC” conversion system and battery management system.

According to sources, as the new locomotive can meet the use requirement of locomotives and bring the power potential of diesel engines into full play, it will be widely used in railway station and yard shunting and the internal railway transport of industrial and mining enterprises including iron & steel, petrochemical and coal enterprises, power plants and ports in the future.  

China contributes 50 percent of coal in the world, but lacks an independent mine-specific variable frequency anti-explosion power system. On October 23, CSR Zhuzhou Electric Co., Ltd. CSR Zhuzhou Electric announced the integrated unit of mine-specific variable frequency motor developed in cooperation with Tangshan Kaicheng Electric Control Equipment Group Co., Ltd., making China the second country capable of independently developing the high-end equipment system after Germany.

According to the Statistical Review of World Energy 2012, China will rank as the world’s largest coal-producing country with a coal output equivalent to 1.956 billion tons of oil. According to the technologists of CSR Zhuzhou Electric, the most advanced power for equipment including large mine winch, tunneller, scraper and conveyor is the integrated unit of mine-specific variable frequency motor that can operates safely, steadily and efficiently in harsh conditions. In the past, only a German enterprise was capable of developing the high-end equipment system in world. In recent years, CSR Zhuzhou Electric and Kaicheng jointly organized technologists to research and develop the unit independently. According to the results of tests and trial operations, the homemade unit enjoys core competitiveness such as small size, high operation efficiency, strong overload capacity, high efficiency and energy conservation.  

11 AM October 22 South Africa Time, the signing ceremony of CSR general freight locomotive project worth 400 million US dollars took place at Transnet Freight Rail Capital Park in Pretoria, South Africa, Xu Zongxiang, executive director and general manager of CSR Zhuzhou Locomotive Co., Ltd. CSR Zhuzhou and Brian Molefe, CEO of Transnet, signed the contract, marking the debut of Chinese electric locomotives in Africa as well as China’s largest overseas electric locomotive order. Among attendees were Malusi Gigaba, minister of the Department of Public Enterprises of South Africa, as well as heads of Transnet, the Chinese embassy in South Africa and CSR.

South Africa, most developed rail transit in Africa, boasts a vast railway network with a total length of over 20,000 kilometers and a gauge of 1,067 millimeters, including an electrified length of over 10,000 kilometers, according to sources. Electrified railways in South Africa include 3kV AC, 25kV DC and 50kV railways, posing complex technical requirements to the overline operations of electric locomotives.

Railway construction and management and cargo transport in South Africa is primarily undertaken by the country’s largest state-owned enterprise Transnet, which owns over 2,100 electric locomotives and over 1,400 diesel locomotives, but most have been overage, and the average useful life of 55 percent of the electric locomotives has exceeded 35 years, showing the huge potential of the market demand for product upgrading.

 
Since one decade ago, CSR Zhuzhou has attached great importance to the African market, paid close attention to South Africa’s railway revitalization and extension investment plan, and embarked on researches on technical problems including narrow-gauge bogie, 3kV AC/25kV AC hybrid power supply. To win the bid, CSR Zhuzhou has established elite marketing and technical teams early at the stage of bid preparation, conducted elaborate planning, and stood out of nearly foreign peers to win the project contract by its comprehensive advantage in technology, localization, delivery period and cost performance through nearly one year of great efforts.

 
According to the relevant expert of CSR Zhuzhou, with a power of 3,100kW and a maximum speed of 100km/h, the locomotives involved in the project are four-axial AC-driven freight locomotives; They will use 1,067mm meter-gauge bogie and 3kV DC/25kV AC for 50Hz double-current power supply 

According to schedules, CSR Zhuzhou will export electric locomotive manufacturing technology to South Africa. The localization rate of the signed project in South Africa will top 60 percent, and the first electric locomotive is expected to be delivered in late 2013.
 
 
 

CSR Sudan DMU order launched

On October 23, goods news came from the overseas market of CSR Ziyang Locomotive Co., Ltd. CSR Ziyang that its Sudan DMU order has been launched.

Composed of two motor cars and four trailers, with a maximum operating speed of 100km/h and a capacity of at least 284 passengers, the AC-DC driven DMU for narrow-gauge trunk passenger railways will operate in a push-pull manner, and will apply to harsh conditions including high temperature, wind and send, etc.

The two motor cars will primarily be AC-DC driven and secondarily be AC-driven, according to sources. The trailers will accentuate simple modeling and bright colors, and fully consider passengers’ comfort and safety according to ergonomic principle, to create favorable travel environment. 

As Sudan’s largest locomotive supplier, CSR Ziyang has exported over 50 passenger and freight locomotives for trunk railways in Sudan, which have adapted to Sudan’s harsh and severe operating environment, and has undertaken over 80 percent of Sudan’s freight volume and passenger transport tasks, with a utilization rate of over 90 percent. It is outstanding product quality and after services that has earned the company customers’ favor and the first DMU order.

It was learned that the DMU is scheduled to come offline in late August 2013.
 
 

With a decade, China’s high-speed railways have grown out of nothing to 6,894 kilometers, ranking first in the world.

Within a decade, China’s railway operation mileage has grown constantly and extended at a rate of six kilometers per day.

Within a decade, CSR has constantly created new products and technologies and ranked among world top enterprises with the extension of railway lines.

Everyday, a new life of travel is interpreting on Beijing-Shanghai High-speed Railway operated like a bus line.

Since the first high-speed EMU manufactured by CSR went into operation in 2006, the convenient, comfortable and fashionable means of transport has been unconsciously updating people’s common sense of transport. 

Jumping to world number one

According to a research report released by renowned German consulting agency SCI Verkehr, CSR topped the list of the world top 10 rail transit equipment manufacturers in the field of new manufacturing [w1] in 2010.

In the early days, CSR had a business turnover of only 10.3 billion yuan and a negative net profit. Within a decade, the accelerated development of the rail transit industry in China and the world has provided strong support for the high-end development of China’s rail transit equipment. Facing the opportunity, CSR has gained rapid development through technical innovation and by independent brand. In 2011, CSR’s business turnover topped 80 billion yuan, eight times as much as that in its early days; and its net profit attributable to the shareholders of the parent company was up to 3.86 billion yuan.

CSR has yielded bumper fruits in developing high-end equipment including high-speed EMUs, large-power locomotives and environment-friendly urban metro vehicles. By June 2012, CSR has supplied 549 standard high-speed EMUs to high-speed lines in operation, accounting for nearly 60 percent, with a total safe operation mileage of 513 million kilometers. CRH380A that set a record of 486.1km/h in global railway operation test has become the mouthpiece of China’s railways in the era of high-speed rail. The test speed of the 500km/h higher-speed test train reached a record 605km/h on the test bench.

To accommodate the super large freight volume of China’s basic materials, CSR has introduced large-power AC locomotive and diesel locomotive wit the highest power in the world. HXD1 coupled locomotive can haul a 20000t thermal coal train and stretch several kilometers on Datong-Qinhuangdao Railway, making the annual freight volume of the railway top 400 million tons. It may be rated as a miracle in the world history of rail transit.

In the urban metro field, an array of CSR’s new products comparable to their advanced foreign counterparts have emerged, including linear motor metro vehicle, localized Type-A metro vehicle, medium & low-speed maglev train and energy-storing light rail train. CSR has so far supplied 5,755 metro vehicles to 18 central cities and held a share of over 60 percent in the Chinese market over the past five years. 

Innovation becomes core competitiveness
On August 10, 2012, CSR and the Chinese Academy of Engineering concluded a technological cooperation agreement. Under the agreement, the two sides will work together in four fields—“strategic consultation service, intensifying cooperative R & D and achievement transformation, carrying out technological cooperation and exchanges, introducing and training high-end technological talents”. This is another footnote to CSR’s efforts to accelerate technical innovation.
Manufacturing represents national strength and innovation ability is undoubtedly the core competitiveness of manufacturing. A new product came out every few years a decade ago, but CSR has introduced eight new products in the first eight months of 2012. The strategy of “technology leadership” has produced effects.

Behind the achievements were CSR’s great efforts to improve the capacity for technical innovation. In recent years, CSR’s annual R & D input has accounted for five to six percent of its annual sales revenues. The company has established four national R & D and experiment institutions, six state-accredited corporate technical centers, nine state-accredited test and experimental centers, six postdoctoral workstations and two academician work stations, and has built the first overseas industrial power and electronic R & D center of China’s rail transit equipment manufacturing in the U.S. and a semiconductor R & D centers in the UK. 

CSR has pooled the efforts of the whole group to build world advanced design, manufacturing and product technology platforms, to consolidate the innovation foundation. CSR has established enterprise-university or enterprise-institute innovation alliances with higher institutes and institutions including Tsinghua University, Tongji University and the Chinese Academy of Sciences, to carry out in-depth cooperation in research fields.

By late 2011, CSR had won 3,688 patents, and participated in formulating six international standards, 49 national standards and 281 industrial standards.

Now CSR has the only two academicians of the Chinese Academy of Engineering in China’s rail transit equipment industry as well as 12,000 engineers. On the most representative EMU and large-power locomotive technology platforms, CSR has brought together an array of high-end technological talents with an average age of 40. 

Broadening global development space

On August 13, 2012, the signing ceremony of the metro project in Ankara was held at the Assembly Hall of the Ministry of Transport and Communication of Turkey. CSR signed a 2.5 billion yuan worth of contract for the metro vehicle project in Ankara.

Less than a month later, CSR announced the successful bid for a locomotive order worth nearly 400 million US dollarsfrom Transnet, South Africa, China’s largest of its kind from abroad.

Today when globalization is highly developed, closed-door policy is doomed to failure. CSR not only “brings in talents and technologies” modestly, but also “goes out” confidently. With the development of globalization, CSR has saw the rapid growth of its export trade, progressively built overseas R & D and manufacturing bases, and accomplished the switch of export trade from startup to acceleration, the switch from low-end exported products to high-end ones, the switch of export destinations from developing countries to developed countries and the switch of operation mode from international trade to internationalized operation.

Overseas investment and technology output are top priorities of internationalization. In this regard, CSR has taken over Canada-listed Dynex, UK, established 10 branches and subsidiaries in countries and regions including the US, the UK, Australia, Brazil and Malaysia, offices and overseas service outlets in a dozen countries and regions, and R & D institutions in the US and UK.

Meanwhile, a growing number of national railways have become CSR’s partners. To date, CSR has exported various vehicles and parts to 66 countries and regions in the world, covering Asia, America, Oceania, Africa and Europe, with its exports soaring from less than 59 million US dollars in 2011 to nearly 1 billion US dollars in 2011. In the first half of 2011, CSR’s overseas revenues doubled, accounting for 11.33 percent of CSR’s total revenues against 6.13 percent last year. In the first eight months of 2012, CSR got overseas orders worth nearly 1.7 billion US dollars, doubling the total value of overseas orders in 2011 and hitting a new record.