"The Transrapid railway to be built by the end of 2003 will mean the 30 kilometre journey between the international airport Pudong and the city centre of Shanghai can be travelled in less than 10 minutes," the consortium said in a statement.

The consortium, a partnership between the German government and industrial backers ThyssenKrupp AG and Siemens, did not say how much it would be paid for the project, which could be worth billions of marks.

DaimlerChrysler AG rail unit Adtranz was also part of the consortium. "This is the opening of the world market for us, a real breakthrough," a Transrapid spokesman told reporters, but declined to say how much the deal was worth.

The Shanghai project would be the first commercial application of the Transrapid technology, which has struggled to win contracts due to its high cost.

An initial 1.6 million mark (US$733,000) deal was signed in July last year by Chinese Prime Minister Zhu Rongji and Transrapid, but it only covered a feasibility study. The magnetic levitation train would be able to reach a speed of 500 kph (310 mph), although it will average about 430 kph (270 mph).

Premier Zhu said he "felt a little dizzy" in July during a 407-kph (255 mph) ride on a test stretch of the train in Germany. Zhu said then the Shanghai project could lead to a total investment of some US$20 billion.

Last year, Germany scrapped plans to build the first Transrapid link in the country between Berlin and the port of Hamburg after eight years of planning and development. Berlin is still considering other shorter stretches for the train.

Transrapid said on Sunday the Shanghai deal should give a boost to other mooted projects in the United States as well as much-longer stretches under consideration in China including a 1,300 km connection between Shanghai and Beijing.

(Dayoo.com 2001/01/22)