Credibility on the line
Toronto transit riders have put a lot of faith in Bombardier, and an awful lot of money as well — $1.25 billion for a new fleet of 21st-century streetcars. In return, the company has made a complete hash of the project.
In what has become a forehead-slapping trail of error, it turns out that Bombardier can’t meet its latest, scaled-back schedule for delivering the streetcars to the Toronto Transit Commission. It now promises to have only 30 of the sleek, low-floor vehicles in operation by the end of this year, far short of its earlier targets.
That means more cost to the TTC, as the commission struggles to keep up service levels by extending the service life of the old streetcars and adding buses on some routes. And it means more inconvenience for transit riders, crammed into smaller cars when they should be travelling in comfort.
The TTC and the city are fed up, as well they should be. CEO Andy Byford calls Bombardier’s performance “woeful” and Mayor John Tory says it’s “no way to do business.”
It’s fine to channel the outrage of transit users and taxpayers. It’s also appropriate for the TTC to pursue its claim for damages for late delivery under the terms of its contract with Bombardier. That could recoup $51 million, or 5 per cent of the value of the contract.
The TTC and the city need to go further than that, and press ahead with legal action to recover any costs they have incurred above and beyond the late-delivery penalty. The TTC board considered that six months ago when wiring and production problems in the new streetcars became known. Things have only gone from bad to worse since then.
Bombardier was originally supposed to have 73 of the new-model streetcars on the tracks by the end of last year. They managed to deliver only 16, after problems developed with parts made at a company factory in Mexico. Then they promised to have 54 operating by the end of this year; now it turns out the figure will be just 30.
To rub things in even more, Bombardier now says it’s really focusing on delivering the complete fleet of 204 vehicles by the end of 2019, rather than getting hung up on interim targets. This, it says, stems from a change of leadership in its North American division, where the new president has “brought a lot of new vision” to the project. If it means missing deadlines for another three years, it’s the kind of vision we can live without.
This affair has already badly undermined Bombardier’s reputation in the country’s biggest city, at a time when the company is deep into talks with the federal government on terms for financial support amounting to $1 billion (U.S.) for its C-Series jet program.
The company would no doubt argue that problems with a streetcar project have little to do with an ambitious airplane program. The link is credibility. If Bombardier blows through its promises on streetcars with such regularity, how can it be trusted to live up to whatever airplane deal it eventually strikes with Ottawa?