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WASHINGTON (Reuters) – Engineering company Siemens AG (OTC:SIEGY) will announce on Tuesday it is investing over $220 million to build a rail car manufacturing facility in North Carolina, the White House and Siemens said.
The announcement comes as the Biden administration and fellow Democrats direct billions in federal funding to upgrade aging infrastructure and increase U.S. manufacturing, hoping to encourage private-sector spending and create jobs. A bill subsidizing chip manufacturing has attracted large investments from companies such as IBM (NYSE:IBM) and Micron (NASDAQ:MU).
Siemens’ new passenger-coach manufacturing facility, which will be built on a 200-acre site in Lexington, a 20,000 population town in central North Carolina, will bring 500 new jobs by 2028, the company said.
“We have a clear commitment from the administration to invest in infrastructure and in making a transformation of the mobility sector towards greener (power sources),” Siemens AG Chief Executive Roland Busch said in a telephone interview.
Busch said Siemens has a “strong foothold” in the market and sees longer term growth opportunities in high-speed rail.
The company’s customers include Amtrak and dozens of transit agencies across the United States, which will be eligible for federal incentives for cleaner-powered locomotives.
Siemens’ rail unit will be receiving a jobs development grant from the state of North Carolina, the company said. Funding comes in part from the bipartisan infrastructure law passed in 2021, the White House said.
The German trains and software maker reported its strongest-ever quarter for its industrial business in February and raised its full-year profit forecasts.
Biden, who rode Amtrak for more than three decades while in Congress, has pushed investment in passenger rail and modernization of the busy “Northeast corridor,” which is one of the nation’s most congested rail corridors.
The $1 trillion infrastructure law provides $66 billion for rail, an unprecedented boost in federal aid for trains. This includes $24 billion in grants for projects in the Northeast corridor.
Amtrak said in November it wants to expand dramatically across the United States and add up to 39 corridor routes and up to 166 cities by 2035.
Mitch Landrieu, the White House official responsible for coordinating infrastructure fund disbursement, said in a statement the announcement “is further proof that we’re driving unprecedented private sector investment,” with the implementation of the infrastructure law.
