Thunder Bay to Build VIA Rail Passenger Cars as Ottawa Announces $4.7-Billion Fleet Investment

THUNDER BAY — NEWS — Thunder Bay’s rail manufacturing sector is set for a major expansion after the federal government announced more than $4.7 billion for VIA Rail to acquire and maintain 313 new passenger cars from Alstom Canada, with manufacturing and assembly work to take place in Thunder Bay and La Pocatière, Que.

The investment marks the first time in roughly four decades that VIA Rail passenger cars will be built in Canada and is expected to support nearly 700 jobs in Ontario and Quebec, while generating more than $1.6 billion in economic benefits.

For Thunder Bay, the announcement represents one of the most significant industrial developments in recent years, reinforcing the city’s long-standing role in rail manufacturing and creating potential opportunities for local suppliers, skilled trades and related businesses.

Passenger Cars Will Be Built in Thunder Bay and Quebec

The new fleet will replace aging VIA Rail equipment used on long-distance, regional and remote routes outside the Quebec City-Windsor Corridor.

Some of the existing rail cars are more than 70 years old.

The 313-car fleet will include several types of passenger equipment, including dining cars, panorama cars and sleepers.

Design and engineering work will take place in Saint-Bruno-de-Montarville, Que., while manufacturing and assembly will be carried out in Thunder Bay and La Pocatière.

Prime Minister Mark Carney described the decision as part of a broader effort to increase Canadian manufacturing capacity and reduce dependence on foreign suppliers.

“In the face of strong headwinds, a confident Canada is choosing to build,” Carney said. “For the first time in four decades, VIA’s passenger cars will be built in Canada.”

Carney said the shift means work that was previously performed in the United States will now support Canadian suppliers and workers.

“Cars once made in the United States, now made here at home. This means new contracts for Canadian suppliers, good jobs for Canadian workers, and paycheques that stay in Canadian cities and towns,” he said.

Thunder Bay Rail Manufacturing Gets Major Boost

The Thunder Bay component is expected to provide a substantial boost to the city’s manufacturing base.

Minister of Jobs and Families Patty Hajdu, who is also responsible for the Federal Economic Development Agency for Northern Ontario, said the investment will create skilled employment and new opportunities for companies serving the rail industry.

“This investment is great news for Thunder Bay and for Northern Ontario,” Hajdu said. “Building the passenger rail cars in Canada means good-paying, skilled jobs for Canadians and new opportunities for local businesses that are part of the rail supply chain.”

She said the project reinforces Thunder Bay’s role in the future of Canadian passenger rail manufacturing.

“With this investment, we’re strengthening our economy, supporting communities, and ensuring Canadian workers continue to play a leading role in building the future of passenger rail right at home,” Hajdu said.

For Thunder Bay, the economic impact could extend beyond direct jobs at the Alstom plant.

Rail manufacturing relies on a broader network of suppliers providing steel, fabricated components, electrical systems, engineering services, transportation and other industrial products.

The federal government says Alstom will draw on a network of more than 900 Canadian suppliers while maximizing the use of Canadian steel in structural assemblies, supports and fabricated metal components.

Buy Canadian Policy Shapes Procurement

The investment is being advanced under Ottawa’s Buy Canadian Policy, which gives greater preference to Canadian companies, workers and materials in federal procurement.

The policy comes as Canada looks to diversify its trading relationships and reduce exposure to supply-chain disruptions and international trade disputes.

The government has increasingly framed major infrastructure and defence procurements as tools for strengthening domestic manufacturing.

Transportation Minister Steven MacKinnon said the VIA Rail fleet renewal fits that approach.

“Canadians deserve a passenger rail system that is modern, reliable, and built to serve them for generations to come,” MacKinnon said.

He said manufacturing the fleet domestically will support rail-sector employment and Canadian engineering capacity.

“By assembling these rail cars in Thunder Bay and La Pocatière, supported by Canadian design and engineering expertise in Saint-Bruno-de-Montarville, we are investing in Canadian workers, Canadian innovation, and a stronger, more resilient economy,” he said.

Fleet Will Serve Remote and Regional Communities

The new passenger cars are intended for VIA Rail’s eight long-distance, regional and remote routes outside the Quebec City-Windsor Corridor.

Those routes serve communities in eight provinces, including Indigenous, rural and remote communities where transportation alternatives can be limited.

In 2025, more than 216,000 passengers travelled on VIA Rail’s long-distance, regional and remote services.

VIA Rail Interim President and CEO Mathieu Paquette said the new fleet will retain features associated with long-distance rail travel while improving reliability, accessibility and comfort.

“These new Canadian-built passenger rail cars will retain signature features such as dome cars, full-service dining, and social areas, while incorporating modern amenities, improved accessibility, and greater reliability,” Paquette said.

He said the equipment will also help maintain service to remote communities.

“They will help us preserve essential services to remote communities and elevate the unique onboard experience that allows passengers to discover Canada in a way that only train travel can offer,” he said.

Ottawa’s VIA Rail Investment Now Tops $6.6 Billion

The passenger-car announcement follows a separate $1.95-billion federal investment announced in July for 45 new passenger locomotives and a new assembly and maintenance facility in Montreal.

That package includes:

• $1.6 billion for 45 new Stadler locomotives;
• $357 million for a new Montreal assembly and maintenance facility; and
• the newly announced $4.7 billion for 313 Alstom passenger cars.

Together, the federal government says its investment in renewing VIA Rail’s long-distance, regional and remote fleet now exceeds $6.6 billion.

Final assembly of up to 36 of the new locomotives will also take place in Canada.

What This Means for Thunder Bay

The announcement gives Thunder Bay something municipal and regional leaders have repeatedly sought: a major long-term industrial workload tied to national infrastructure spending.

The city has a long history of building rail vehicles, but manufacturing employment has often been vulnerable to the timing of large contracts.

A major VIA Rail order could provide greater stability for skilled trades, engineers, production workers and suppliers over several years.

It could also strengthen the case for expanding training in welding, electrical work, advanced manufacturing and other industrial skills through local educational institutions.

The broader question will be how much of the supply-chain spending remains in Northwestern Ontario.

If local companies can secure contracts for components, transportation, maintenance or related services, the economic impact could extend well beyond the plant itself.

Canadian Manufacturing Becomes Part of Economic Strategy

The announcement also reflects a wider change in federal economic policy.

Canada is increasingly using public procurement to support domestic production rather than relying primarily on international sourcing.

That strategy is being shaped by growing geopolitical uncertainty, trade disputes and concerns over supply-chain security.

Rail manufacturing is only one part of that shift.

Governments are applying similar thinking to defence, critical minerals, energy and transportation infrastructure.

For Thunder Bay, that creates an opportunity.

The city’s location, industrial history, transportation infrastructure and skilled workforce could make it well positioned to benefit if federal and provincial governments continue directing more procurement toward Canadian manufacturing.

The VIA Rail contract will now become one of the most important industrial stories to watch in Northwestern Ontario.

The next questions will be how quickly production ramps up, how many jobs are based in Thunder Bay, which local companies secure supplier contracts, and whether the project leads to additional long-term rail manufacturing work.

Thunder Bay, VIA Rail, Alstom Canada, rail manufacturing, Mark Carney, Patty Hajdu, Steven MacKinnon, passenger rail, Buy Canadian, Northern Ontario jobs, Thunder Bay economy, Canadian manufacturing, VIA Rail fleet, infrastructure, transportation