Bombardier to win C$1 billion Montreal subway car order

Tue Oct 5, 2010 6:29pm EDT
 
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OTTAWA (Reuters) - Quebec will award Bombardier Inc a contract worth more than C$1 billion ($980 million) to build nearly 500 subway cars for Montreal, short-circuiting a bidding process that has dragged on for five years.

The Canadian province's government will introduce special legislation on Wednesday to give Montreal-based Bombardier and its French partner, Alstom, the contract without completing a process required by international law. The move could prevent two more years of delay.

The decision comes with Quebec Premier Jean Charest and his ruling Liberal Party well behind the separatist Parti Quebecois in opinion polls.

It could anger ZhuZhou Electric Locomotive Ltd of China and Spain's CAF, which were also vying to make the cars for the Montreal subway system.

The contract calls for 468 metro cars to be built for Societe de transport de Montreal, or STM, at about C$2.6 million each, Charest said on Tuesday. The total value is about C$1.22 billion.

Bombardier spokesman Marc-Andre Lefebvre said the company would soon announce the award.

Quebec said it would speeding up the process because of "an urgent need to replace the metro cars as quickly as possible."

The Montreal Gazette, the city's largest English-language newspaper, called for the government to reissue the tender or risk an international backlash.

"The Charest government should quickly reinstate its international tender call to replace Montreal's aging metro cars before lawsuits are filed and Quebec's reputation as a rules-abiding, non-protectionist state takes a nasty hit," the paper said in a Tuesday editorial.

"This maneuver is wrong, hypocritical and possibly not even in the best interests of the Quebec taxpayer. The government should let the bidding continue."

(Reporting by John McCrank; editing by Peter Galloway)