The federal government is committing more than $4.7 billion to replace hundreds of aging VIA Rail passenger cars, with manufacturing and assembly set to take place in Ontario and Quebec as Ottawa pushes to expand domestic rail production.
Prime Minister Mark Carney announced the investment Thursday in Thunder Bay, saying VIA Rail will acquire 313 new passenger cars from Alstom Canada. The agreement also covers long-term technical support and spare parts for the new fleet.
The government describes the deal as the largest investment in VIA Rail’s history and says it will mark the first time in four decades that VIA passenger cars are manufactured in Canada.
Under the agreement, design and engineering work will take place at Alstom’s Saint-Bruno-de-Montarville facility in Quebec. Car bodies will be manufactured in La Pocatière, Que., while final assembly will take place in Thunder Bay, Ont.
The announcement comes as the Carney government seeks to increase domestic procurement and reduce Canada’s exposure to trade disruptions, particularly amid continuing tensions with the United States. The government has made its Buy Canadian policy a central part of that effort.
“In the face of strong headwinds, a confident Canada is choosing to build,” Carney said. “For the first time in four decades, VIA’s passenger cars will be built in Canada.”
The prime minister said the investment would mean additional contracts for Canadian suppliers and employment for workers in communities involved in the project.
According to the federal government, the project is expected to support nearly 700 jobs in Ontario and Quebec and generate more than $1.6 billion in economic benefits. Alstom separately estimates the project will create or support up to 670 direct jobs within its Canadian operations, along with additional employment through the supply chain.
Alstom says the $4.7-billion agreement consists of approximately $4 billion for the 313 Adessia passenger cars and nearly $700 million for a 15-year technical support and spare-parts agreement. The company says it intends to draw on a Canadian network of more than 900 suppliers to deliver the project.
The investment addresses a longstanding problem for Canada’s national passenger railway: much of the equipment operating on its long-distance, regional and remote routes is well beyond the typical lifespan of passenger rail cars.
Transport Canada reported earlier this year that roughly 75 per cent of VIA Rail’s fleet serving those routes is more than 65 years old. The department said the industry-standard lifespan is generally between 35 and 40 years.
The new cars will operate outside VIA Rail’s Quebec City-Windsor Corridor and serve eight long-distance, regional and remote routes.
Alstom says those routes connect nearly 400 communities and include services linking cities and communities such as Toronto, Vancouver, Halifax, Montreal, Churchill, Prince Rupert, Jasper, Sudbury, White River and others.
The routes also provide transportation to rural, remote and Indigenous communities where alternative public transportation can be limited. Transport Canada says VIA’s long-distance, regional and remote network serves 93 Indigenous communities that do not have alternative public surface transportation.
The replacement fleet will include nine types of cars designed for different services, including coaches, sleepers, dining cars, baggage cars, panorama and dome cars. Alstom says the new equipment will include updated accessibility features, digital connectivity and more spacious interiors.
Mathieu Paquette, VIA Rail’s interim president and CEO, said the railway intends to preserve some of the characteristics associated with its long-distance trains while modernizing the equipment.
“These new Canadian-built passenger rail cars will retain signature features such as dome cars, full-service dining, and social areas,” Paquette said, while adding that the fleet will incorporate improved accessibility and reliability.
Thursday’s announcement follows a separate federal investment announced in July for 45 new passenger locomotives and a new assembly and maintenance facility in Montreal.
The government says the combined commitments to renew VIA Rail’s long-distance, regional and remote fleet now exceed $6.6 billion.
That includes $1.6 billion for 45 locomotives from Swiss manufacturer Stadler and $357 million for the Montreal facility, where up to 36 of those locomotives are expected to undergo final assembly.
The scale of the investment also places attention on how quickly the new equipment can enter service and whether the fleet renewal translates into improved reliability for passengers who depend on VIA’s long-distance and remote services.
The government has not presented the investment as an expansion of VIA’s route network. Rather, the new cars are primarily intended to replace aging equipment already serving the national network.
For Alstom, the contract represents a major order for its Canadian manufacturing operations.
“This project marks the beginning of a new chapter between Canada’s national passenger railway company and the country’s local rail manufacturer,” said Michael Keroullé, president and CEO of Alstom Americas.
The federal government says the procurement is intended both to modernize passenger rail and to direct a larger share of public infrastructure spending toward Canadian workers and suppliers.
For passengers, however, the longer-term measure of the investment will be whether the new fleet delivers more dependable and accessible service across a network where some trains currently rely on equipment built more than seven decades ago.
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