Japan Looks to Locate Export Market for Bullet-Train System

Author: Lucas Blankenship

Published:

Japan’s Prime Minister, Shinzo Abe, is set to visit the U.S. this week and aims to pitch Japan’s bullet-train system to state representatives in California. Currently, Japanese companies are competing to join three fast-train projects that are under consideration in the United States. The three individual projects would link Los Angeles to San Francisco, New York to Washington, and Dallas to Houston. Abe is hoping to attract an export market for Japan’s advanced bullet-train system in order to help jumpstart the nation’s economy. As of now, he sees the United States as a viable export market for the revolutionary train system.

In order to secure contracts in the U.S., Abe will have to convince U.S. buyers that Japan’s bullet-train system is superior to rival systems made in China and Europe. While in the U.S., he will likely speak to the advantages of the Shinkansen system, which include its impeccable safety record and high reliability. Abe also plans to introduce the maglev train, which can travel 375 miles per hour and is currently the fastest train in the world.

If Japan’s bullet-train system is able to obtain success in the U.S., it will open up opportunities in other markets. Japan is looking to Southeast Asia as a potential market, and has been conducting feasibility studies in India, Thailand, Vietnam, and Indonesia. However, to be successful in this market, Japanese companies will have to beat out rival Chinese companies. Last year, officials in Thailand awarded a high-speed rail contract to China, despite years of negotiation with Japanese companies. Despite having great quality and reliability, Japan’s bullet-train system is significantly more expensive than the system offered by Chinese companies. This price differential could make it difficult for Japanese companies to secure contracts in this region.

If Japan is able to establish an export market for its high-speed rail system, the economic benefits to Japan will be immense. The multibillion-dollar nature of these deals means that securing even one contract will have an enormous impact on Japan’s exports and balance of trade.