Hyundai Rotem, a South Korean manufacturer of railway systems and defense equipment, lost out to a consortium led by a Chinese-backed company in the bidding war for Australia’s largest urban rail infrastructure project, the Suburban Rail Loop East (SRL East) in Victoria.
Although the company has been accelerating its market push in Australia based on a series of contract wins, this failure appears to have halted its expansion strategy.
Several media outlets reported on May 19 that the TransitLinX consortium-led by John Holland, a subsidiary of China Communications Construction Company (CCCC)-was selected as the preferred bidder for the Linewide package, a core part of the SRL East project initiated by the state of Victoria. Hyundai Rotem also competed as part of a consortium but failed to win the final contract.
The state government of Victoria plans to sign a contract with the TransitLinX consortium by the end of this year.
The consortium includes John Holland, French public transport operator RATP Dev, French railway systems manufacturer Alstom, U.S.-based engineering and project management firm KBR, and Canadian engineering company WSP.
Hyundai Rotem participated in the competition through the UrbanLeap consortium. This group included Malaysia-based infrastructure and construction firm Gamuda, Australian public transport operator Keolis Downer, German railway systems provider Siemens, U.S.-based global engineering and design firm AECOM, Australian engineering and environmental consultancy GHD, and Australian rolling stock maintenance and operations company Downer Rail.
The SRL East is a 55.92 mile orbital urban rail network project around Melbourne. Development has begun on the eastern section, which connects Cheltenham and Box Hill over 16.16 mile. The Linewide package covers train manufacturing, system installation, and operations and maintenance.
The total project cost ranges from $5.15 billion to $5.81 billion.
Among Korean companies, GS Engineering & Construction won a portion of the SRL East project last year. GS E&C is participating in the project alongside Webuild and VIG.
The total contract is valued at $10.96 billion, with GS E&C responsible for approximately $367 million.
The company will carry out construction for a 6.21 mile twin-tube TBM tunnel, emergency access passages, and underground station excavation.
Hyundai Rotem entered the Australian market in 2016 by supplying double-decker electric trains to New South Wales. It went on to secure additional contracts from the state in 2019 and 2021, and in 2023, won a $873 million electric train project from Queensland. In October of last year, it established a local subsidiary to strengthen its sales of railway vehicles.
