In recent years, China has become increasingly prominent in Brazil’s rail transport sector. From new train factories to urban infrastructure, Chinese hardware and companies are taking center stage.
In 2026, China Railway Rolling Stock Corporation (CRRC), the world’s largest rail equipment producer, inaugurated its first factory in Latin America in Araraquara, São Paulo. The facility, which was previously owned by Hyundai Rotem and produced trains for several Brazilian metro networks, now aims to manufacture interstate and high-speed passenger rail cars as well.
The inauguration event, attended by Brazilian President Luiz Inácio Lula da Silva, featured the signing of R$ 5.6 billion (roughly USD 1.1 billion) in loans from the Brazilian Development Bank (BNDES). These funds will support two major passenger rail projects: the expansion of São Paulo’s Green Line, which serves up to 750,000 people daily, and the new Intercity North Line (TIC Eixo Norte). This new route will connect the São Paulo metropolitan area (21 million inhabitants) with the Campinas region, the state’s second-largest hub with 3.2 million residents.
The latter project also features a significant CRRC presence. It is piloted by TIC Trens, a consortium composed of Grupo Comporte (60%), which manages the Belo Horizonte metro, and CRRC (40%). This consortium already controls Line 7 of the São Paulo Metro, transporting up to 450,000 passengers a day, and holds the concession to operate the new intercity train as well as other regional passenger lines in São Paulo, such as the Jundiaí-Campinas route.
Beyond its direct involvement in the planning and construction of new rail lines, CRRC is already leading the market with contracts for metro lines across Brazil. The company holds sales contracts for 6 lines in the São Paulo Metro. Outside São Paulo, Belo Horizonte has also engaged the company for a train contract, and more recently, in July 2026, the Salvador Metro signed a 24-train contract. In total, CRRC has a 139 train backlog that could total +10bi BRL or 2bi USD, some of which can now potentially be built in Brazil thanks to the company's new factory.
Beyond new rail lines, another player making a surprising entry into the sector is BYD. The company, which recently disrupted the Brazilian auto market to become the fourth-largest seller of private cars, also delivered a tailor-made skytrain for São Paulo Metro’s Line 17 (Gold Line), connecting Congonhas Airport to the broader metro network.
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Originally scheduled for delivery in 2014, the Line 17 project suffered multiple delays and design flaws that rendered standard aerotrains unsuitable. BYD stepped in with a custom solution, delivering 14 fully electric and autonomous trains.
Being BYD’s first rail project outside China, the company saw an opportunity to test and demonstrate the capabilities of its high-tech trains in the largest city in the Americas. These trains differ significantly from others operating in São Paulo; they are equipped with autonomous driving capabilities and can operate without external power, utilizing onboard batteries for the entire 6.7km length of the line if needed.
The project, costing R$ 982 million (approximately USD 192 million) with trains produced in Guang’an, China, was delivered in early-2026. It proves the capacity of Chinese rail manufacturers to salvage decade-old stalled projects with tailor-made solutions.
Other Players Eye Brazil’s Rail Boom
Another major passenger project is the Rio-São Paulo high-speed rail. Originally pitched as a bullet train in 2007, it has been a long-held dream for Brazilians that never got off the ground. Now, the current Lula administration and the New Growth Acceleration Program (Novo PAC) have breathed new life into the 417km project, with construction slated to begin in 2028. Initially rumored to be led by a Chinese construction consortium the project is currently drawing interest from European investments groups.
Other brand-new projects are also attracting Asian and European interest, such as the Brasília-Goiânia high-speed rail and additional intercity routes in São Paulo: TIC South, East, and West. These are all in the planning phases, with bidding schedules expected between 2026 and 2027.
Tackling the “Custo Brasil”
This influx of foreign capital and technology is not happening in a vacuum; it is a direct response to a broader structural shift. For decades, Brazil’s economy has been hindered by the notorious “Custo Brasil”—the systemic inefficiencies and high logistical costs of operating in the country. As the government opens its rail network through new regulatory frameworks, international players like CRRC and BYD are capitalizing on a massive pent-up demand. By supplying the hardware needed to modernize infrastructure, these companies are positioning themselves at the center of Brazil’s strategy to shift cargo from roads to rail, a move that will significantly lower transport costs and boost the global competitiveness of its exports.
Rail Investment Before and After the Truck Drivers’ Strike
Rail infrastructure in Brazil has historically been neglected, relegated to a secondary mode of transport. Since the rapid industrialization of the 1950s, the country has heavily favored roadways for both passenger and cargo transit. However, this paradigm is beginning to shift.
Following the paralyzing truck drivers’ strike of 2018, the country realized that an overreliance on road transport was a major obstacle to economic growth and national security. Since then, Brasília and state leaders have pivoted to promote and invest in rail as a more efficient alternative.
This effort has been championed by both the public and private sectors, bolstered by the approval of Law No. 14,273 in December 2021. The new Legal Framework for Railways allows private entities to construct and operate railways under an authorization model, a significant departure from the previous system where the market operated almost exclusively under strict government concessions.
The private sector is investing heavily, seeking efficiency for the booming agribusiness export market. Notable initiatives include projects by Rumo (B3: RAIL3) of the Cosan Group, such as the Mato Grosso state railway connecting prime soy and corn production areas to the broader national network. Other major developments include the Transnordestina (TLSA), West-East Integration (FIOL - Stretch 1), Midwest Integration (FICO), and the crown jewel of the new regulatory system: the Sucuriú Project. This new private rail line will serve a $4.6 billion new Arauco pulp mill in Mato Grosso do Sul, which aims to produce 3.5 million tons of market pulp annually.
In total, the National Land Transportation Agency (ANTT) announced that the private sector has submitted R$ 170 billion in proposed investments for authorized railways. Furthermore, in 2026, the Novo PAC funneled R$ 92 billion in loans toward rail infrastructure, focusing primarily on the aforementioned projects.
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