Bids for Metro Rail Cars Much Higher Than Predicted

Opening bids for the production of 87 light-rail cars for Los Angeles County’s Metro Rail system are running significantly higher than predicted by county transportation officials last year.

The bids, released Monday by the Los Angeles County Transportation Commission, range between $3 million and $4 million for each car. Last year, the commission’s executive director said he expected cars to cost between $2.3 million and $2.7 million.

Despite the difference, director Neil Peterson said he remained hopeful that the price will fall substantially during negotiations. “I think it would be a major mistake to read too much into these figures,” Peterson said. “This is a first step in a very intense negotiation process. I expect these prices to change pretty dramatically over the next couple of months.”

Moreover, Peterson speculated that the bids had been influenced by a new state law requiring disclosure of public transportation bids. “It’s not surprising to me at all that the figures released by the firms . . would be on the high side,” he said, suggesting that companies--knowing the competition would have their numbers--made their bids high to give them more flexibility during negotiations.

Peterson said he was pleased that four different teams had made bids. “What we have here is true competition. That’s the best possible environment to let that price get down,” he said.

The contract, to be awarded in June, calls for the production of up to 85 light-rail cars and two prototypes for use on the Green Line and other routes in the county’s expanding transit system.

The lowest bid, submitted by Siemens Duewag Corp. and the TRW Aerospace Unit, was for $3.01 million per car. The highest, made by Sumitomo Corp. and Rockwell Corp., was for $4.09 million. The partnership of Morrison Knudsen and the Lockheed Corp. bid $3.68 million a car, and the team of Bombardier Corp. and Northrop Corp. bid $3.18 million.

Price is only one factor to be considered in awarding the contract. The commission also will take into account the extent of American-made parts in the cars and technological innovations developed by the prime contractor in conjunction with local aerospace and electronic firms.

The domestic-content requirements--intended to create American manufacturing jobs--have undoubtedly added to the car cost, Peterson said. Also driving up the price are specifications that the driver-operated cars be built so they can be converted to an automated, driverless system.

“These specifications called for a highly technical, highly advanced kind of car,” said Stanley Crow of Morrison Knudsen.

Although the commission has not yet estimated how many Southern California jobs may be created as a result of the contract, the bids include possible subcontracts with 33 small and medium-size firms in the region.