A contract has been signed for the $2.8 billion project to design, build and maintain the new regional rail fleet.
The contract has been signed with Momentum Trains, which is lead by Spanish company Construcciones y Auxiliar de Ferrocarriles.
It includes the construction of the new rail fleet, which is comprised of 10 regional intercity trains, nine short regional trains and 10 long regional trains, as well as the establishment of a rail maintenance facility.
Transport and Infrastructure Minister Andrew Constance said the fleet would replace the current XPT, XPLORER and Endeavour trains.
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"We're going to take the maintenance of country trains out of the city and put the jobs where they belong, in the country, where these trains are going to be maintained," Mr Constance said.
"We're going to have 200 jobs during construction, 50 full-time maintenance jobs and 60 associated with the final fit out of these trains."
Dubbo MP Troy Grant said the kids in Dubbo schools would now be able to consider a career in the industry without having to leave home.
The new trains will travel at 160 kilometres per hour. They'll be diesel and electric to produce fewer emissions and have been designed with consultation from the public, Mr Constance said.
"We're going to have a premium service, we're going to have an economy service, we're going to have charge points where you can charge your iPhone and they're Wi-Fi enabled," he said.
Trains on longer rail journeys will also include buffet cars and be more comfortable for people in a wheelchair.
Deputy Premier John Barilaro said it was one of the most exciting transformations of passenger rail in NSW fr decades, improving how people travel and ensuring investment goes straight back into regional economies.
Construction on the new regional rail fleet and maintenance facility will start straight away. Mr Constance said he expected the fleet to be progressively introduced from 2023, operated by NSW TrainLink.
The contract with Momentum Trains is to maintain the trains for 15 years.