Firm vows to restore credibility

Bombardier resolute after losing out on US$3.2-billion New York subway contract

MONTREAL — Bombardier says it has to restore its credibility as a rail transportation leader after being shut out of a US$3.2-billion contract to supply subway cars in New York City because of past delivery delays.

The Montreal-based company (TSX:BBD.B) said it learned last week that its bid submitted to New York’s Metropolitan Transportation Authority in December won’t make it to the final round.

In a letter sent to employees, the president of Bombardier Transportation’s Americas division said the manufacturer’s poor performance that caused a nearly 24-month delay in delivering a current order for 300 subway cars “sealed the fate of our bid.”

“Our actions have exacerbated an already difficult mobility environment in New York City and our client’s decision demonstrates that the market is no longer willing to accept delays in performance and suffer the impact of our shortcomings,” wrote Benoit Brossoit.

“This is a serious warning shot and we must respond in accordance with our promises of delivery, time and without excuses.”

The New York transit authority declined to comment because the procurement has yet to be awarded.

Its decision follows Bombardier’s problems in delivering a prototype light rail car and streetcars that have soured its relationship with Toronto area transit authorities.

The provincial transit agency Metrolinx has excluded Bombardier and three other firms from bidding to continue operating GO Transit suburban trains. Bombardier is asking the courts to review the decision on the contract valued at more than C$2 billion.

Bombardier spokesman Eric Prud’homme said the company is extremely disappointed by New York’s decision but notes that the loss of the contract to supply up to 1,700 subway cars is not currently expected to have an impact on employment at its facilities.