Bombardier Inc. isn’t taking an almost $1.6-billion British rail contract win for granted even though a major German rival, Siemens AG, has withdrawn from bidding on the Crossrail project.
“We don’t see this as swinging the competition towards us in any way. We don’t rest on our laurels and we aren’t looking for handouts,” spokesman Marc Laforge said.
“We have restructured our business to be as competitive as possible. We are up against a competitive field, but we will compete robustly and aim to win.”
Siemens said Friday that it will no longer proceed with the procurement process because it is too busy with other contracts, including the $2.5-billion Thameslink project it won over Bombardier in 2011.
“This is a strategic decision that has been taken based on current business activity levels,” the company said in a news release.
Siemens is under pressure to deliver high-speed trains to national rail operator Deutsche Bahn, which are expected to be four years late because of software difficulties. It also faces delays on a Eurostar order for high-speed trains linking Paris to Brussels and London.
“To pursue another project of this scale could impact our ability to deliver our current customer commitments – something we believe would not be a responsible course of action,” the company said.
The winning Crossrail bidder will deliver 600 railway cars for a new line connecting east and west London. The contract is expected to be announced next year, with service starting in late 2018.
Siemens described the Crossrail bidding process as “fair and diligent” and said it would continue to deliver signalling and communications and control systems for the project.
Other bidders are CAF of Spain and Hitachi of Japan.
Industry observers believe Siemens’ move opens the door for Bombardier, which would build the railway cars at Britain’s last remaining train factory.
The Berlin-based transportation division of Quebec-based plane and train maker Bombardier has said Derby will close unless it wins a large contract.
Walter Spracklin of RBC Capital Markets said the withdrawal by Siemens significantly improves Bombardier’s prospects of winning the contract.
“This development all but assures Bombardier in winning this contract of size, which will likely keep its Derby plant from shuttering,” he wrote in a report.
He said Bombardier had already been widely expected to win the contract after losing the Thameslink deal, but Siemens was a top competitor because the railway cars are similar on both projects.
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