LDA president cites slump in Chinese economy
LIMESTONE, Maine — China North Industries Group Corporation, or Norinco, has been discussing plans of manufacturing railcars at the former Loring Air Force Base in Limestone for several years. Under this plan, the Maine Military Authority would be a contractor for Norinco.
However, LDA President and CEO Carl Flora said that the project may face significant delays.
“Norinco is apparently still interested in project,” said Flora. “They continue to be engaged but there are some headwinds they’re facing that perhaps they weren’t a year ago. Not surprising, one of them is the inability of their key executive to get a visa, although Norinco is now saying that they will go through with this project, and that they’ll figure out a way to do it.”
Allowing Norinco’s executive to enter the United States is crucial the project, as they need to oversee the project’s start-up and development.
“The other thing is that the Chinese economy is in a soft spot,” continued Flora. “The demand for railcars, particularly tanker cars, has slowed down. Much of the crude (oil) was being shipped by tanker cars, and that activity has diminished almost to a stand still. High demand for tankers has subsided. I no longer see that project as something that Norinco is in a rush to complete. This is a commitment that we’re going to be here for 30 years, so we want to make sure we do it right.”
“You think it’s worth mentioning to them that if they don’t feel it’s important to build tank cars, a lot of Norinco’s sidelines are construction equipment, trucks, other cars, trailers, and other equipment they would consider,” asked Board Member Miles Williams. “Is this worth bringing up to them?”
“We’ve had those discussions with them and they’ve mentioned sideline aspects to their railcar enterprise,” said Flora, “but the railcar, to date, is their central focus. One other thing is that there are new standards for tanker cars. A lot of tankers are still perfectly good but they need to be rebuilt or modified, and they have a five year grace period. This is still an area where there is a lot of active interest, it just probably isn’t going to happen soon.”
“I’d just hate to see them abandon the project because it might take two or three years for their executive to obtain a visa,” said Williams.
