KiwiRail was forced to replace sub-standard brakes on all of its 500 Chinese made freight wagons before they entered service last year.
Documents obtained under the Official Information Act show initial tests found that when fully loaded to 72 tonnes gross the wagons failed to stop within the code requirement of 650 metres.
KiwiRail says the quickest, simplest and most cost effective solution was to replace the brake blocks with a marginally higher-friction version.
In a statement, KiwiRail says it carried out this work directly but any additional costs were borne by the manufacturer under warranty.
It says replacing brake blocks on wagons is a routine maintenance activity and typically needs doing between two and four times a year depending on mileage.
Wagons should have been made here - Labour
The Labour Party says the situation is a disgrace.
Dunedin South MP Clare Curran, who has been critical of the decision to send the wagon work offshore, says she's appalled the original brakes were not up to scratch.
She says it's an example of why the wagons, costing $49 million, should have been made at KiwiRail's own Hillside workshops in Dunedin.
New Zealand First transport spokesperson Brendan Horan says the quality of the Chinese wagons leaves a lot to be desired.
A Rail and Maritime Transport Union spokesperson says there have been multiple issues with the Chinese wagons since their introduction and union members are frustrated about it.
But KiwiRail freight operations manager Aaron Templeton told Checkpoint the wagons are performing well and have travelled more than 26 million kilometres.
He says some problems are to be expected when introducing new rolling stock. "We have had some issues, but they are consistent with what we would expect when we are commissioning new equipment."
Transport Minister Gerry Brownlee is not commenting on the braking problem, saying it is an operational matter for KiwiRail.