Transport Minister Steven MacKinnon said Wednesday he hopes Ottawa's $1.9 billion investment in replacing Via Rail's locomotive fleet and building a train assembly plant will lead to better rail service for Canadians.
The federal government plans to spend $1.6 billion to replace 45 of Via Rail's aging locomotives and another $357 million to build the new assembly and maintenance facility in Montreal.
"Locomotive assembly is returning to Canada," Transport Minister Steven MacKinnon told a news conference in Montreal.
The trains will be built by Switzerland-based Stadler. The first nine are to be built in Spain, while the remaining 36 will be built in Canada after Canadian workers learn how to assemble them from their Spanish counterparts.
The locomotives are expected to be the first hybrid trains in North America.
"An aging fleet comes with challenges. Today's announcement gives us the tools we need to do better by our passengers," Via Rail CEO Mathieu Paquette said.
"The new hybrid locomotive offers us better performance, reliability, and will allow us to reduce our emissions and fuel use."
When asked what challenges Via Rail is facing in maintaining its fleet of 52 General Motors F40PH-2 locomotives — which entered service in the late 1980s and have not yet reached the end of their life cycle — Paquette pointed to "extreme weather."
"We have trains leaving London, Ont., in the winter time when it's 10 C in the morning, and they get to Quebec City where it's -35 C," Paquette said, without explaining the impact temperature shifts have on train maintenance.
Miguel Cerdá, industrial vice president at Stadler, said at the news conference his company's trains can operate in -50 C.
Paquette was not available for a followup interview with The Canadian Press on Wednesday. A Via Rail spokesperson later said the amount of effort required to maintain the fleet "grows exponentially" as it ages.
"They work. They are perfectly safe. But we have to put a lot of effort and a lot of expertise to keep them going," said Karl Helou.
"And this is why the new locomotives will really help us focus our efforts better where it needs to go."
When asked whether Via Rail has conducted an analysis to determine how much money it might save by replacing the fleet, Helou declined to provide specifics.
While he pointed to Via Rail's annual reports, those reports don't break down the costs associated with maintaining the locomotives.
"Most of the corporation’s rolling stock equipment, used for non- (Windsor-Quebec City) corridor services, has essentially reached the end of its operating life," the 2024 annual report reads.
"Its reliability has deteriorated in the past few years, resulting in delays and additional operating costs to maintain a state of good repair. Increased maintenance costs and reduced availability of equipment in upcoming years are to be expected until a replacement fleet is introduced."
The new trains will replace Via Rail's fleet across the country, except for the Windsor-Quebec City corridor, where the federal government is planning the Alto high-speed rail line. Via Rail announced plans in 2018 to replace the trains along that corridor with new Siemens Charger locomotives; the first of those trains entered service in 2022.
Via Rail's Siemens Charger locomotives sit on the tracks at the Via Rail Canada maintenance centre in Montreal on Thursday, Feb. 22, 2024.THE CANADIAN PRESS/Christinne Muschi
Canada's auditor general reported earlier this year that Via Rail has failed over the past decade to improve its on-time performance, which sank to a dismal 30 per cent in the first three months of 2025.
"It's true there are obstacles with respect to reliable operation of Via Rail in certain parts of the country, particularly where Via Rail shares its rail routes with cargo trains," MacKinnon said in French at Wednesday's news conference.
"But we expect improvements in customer service, in terms of reliability. People should count on a reliable train service."
Speaking to The Canadian Press later, MacKinnon said the new equipment will improve Via's reliability.
"More broadly, we expect Via Rail to improve its customer service experience, and improve its reliability track record," he said.
"Reliability is one of — if not the — essential ingredient in attracting riders. We have an interest as a country in attracting ridership on Via Rail, and to Alto when it is constructed. So all of the decisions we make are with a view to helping Via to improve their service, and we've set out a clear challenge to Via management to make sure the situation continues to improve."
MacKinnon said the deal will create 1,200 new full-time jobs and the hybrid trains will be built with Canadian-made batteries.
The first trains are expected to enter service by 2031.
Paquette also said Via Rail will soon make an announcement on replacing its passenger cars.
"The process is still ongoing, so I can't comment. But I can say that we'll make an announcement," Paquette said in French.
This report by The Canadian Press was first published July 29, 2026.
— With files from Chris Reynolds in Montreal
By Nick Murray | Copyright 2026, The Canadian Press. All rights reserved.