N.Y. Panel Urges Cubic for Turnstile Contract : Electronics: S.D. company is favored to win $102-million pact to replace decades-old fare-collection system in New York City’s subway.


The New York City Transit Authority has recommended that San Diego-based Cubic Corp. be awarded a $102-million contract to install automatic fare-collection devices that would replace aging turnstiles in some of New York City’s 649 subway stops.

The initial contract could grow to an estimated $670 million if Cubic wins subsequent contracts to manufacture and install hundreds of fare machines, complex computers and additional electronic equipment needed to modernize New York’s antiquated subway and bus fare collection systems.

However, the Transit Authority’s recommendation must first be accepted by the New York Metropolitan Transportation Authority Board, the authority’s parent organization. The board’s Finance Committee did not act on the recommendation at a Monday meeting, Board spokesman Tito Davila said Monday.


Committee members “had questions on the automatic fare collection contract and did not vote on the recommendation,” Davila said. “The board wants to study (automatic fare collection) in other cities to determine how well it has worked.”

It was uncertain Monday when the board would vote on the automatic fare collection contract, Davila said. The subway system intends to install the first fare machines in 1992, with subsequent contracts to be awarded over a five-year period, Davila said.

Executives at Cubic and its Western Data Systems subsidiary declined to comment on the transit authority’s recommendation because “we don’t have a contract yet,” Cubic spokesman Jerry Ringer said Monday.

However, Cubic’s stock responded favorably to the recommendation, closing up $3.25 at $23.125 on Monday in America Stock Exchange trading.

Cubic has been competing for the lucrative New York City subway contract since 1986, when the transit authority asked potential suppliers to prepare proposals for a highly automated system that would replace the familiar tokens and turnstiles that date back to the 1930s and 1940s.

Cubic and competitors have installed prototype machines in subway stations that have been used to determine whether the machines are tough enough to withstand the New York system’s daily crush of patrons--as well as attacks by subway vandals.

The New York contract is important to Cubic and Western Data Systems because it represents one of the last major contracts available. Many metropolitan subway and rail systems already have installed modern fare equipment.

Unlike the existing token system, the one designed by Cubic would utilize magnetically coded fare cards. The computer-driven system would give the subway’s operators “a lot more flexibility” when it comes to designing fares for different segments of the operation, Davila said. The system also is expected to reduce pilferage.

The contract would be a feather in the hat of Cubic’s Western Data Systems, according to Irving Katz, an independent industry analyst who follows Cubic.