November 8, 2014 / 12:27 PM / in 3 years

Bombardier CEO sees Mexico 6-mth high-speed rail bid window as 'tight'

BEIJING (Reuters) - Canadian train and planemaker Bombardier said a six-month window to prepare a bid for Mexico’s $3.75 billion high-speed rail contract looked tight.

A plane flies over a Bombardier plant in Montreal, January 21, 2014. REUTERS/Christinne Muschi

Mexico on Friday revoked the contract from consortium led by state-backed China Railway Constructon Corp.

The government said it expects to re-run the tender to build the 210-km (130-mile) line to connect Mexico City and the central city of Querétaro in late November under the same terms, and would keep it open for six months to enable all interested parties to participate.

“They’re giving it six months which is not a lot...Usually high-speed like this should take about a year to prepare because it’s very, very technically challenging to do this right,” Chief Executive Pierre Beaudoin told Reuters on Saturday.

“I’ll look at it with my team and we’ll make a decision,” he said. Bombardier was among firms accompanying Canadian prime minister Stephen Harper on a visit to China.

The China-led consortium’s win was seen by analysts as a big boost for China’s growing ambitions to export its high-speed technology overseas, since the country built the world’s longest network in under a decade.

The bid by CRCC and its team, which also included locomotive maker CSR Corp, was accompanied by an agreement that the Export-Import Bank of China would finance 85 percent of the project costs.

Siemens, which along with Bombardier and Alstom SA, had expressed interest, said they had asked for more time to prepare a bid.

“Overall I think it’s pretty balanced,” Beaudoin said on competition against CNR.

“They can bring financing to the table, but we have technology that they can’t bring. We have a reputation on how we handle contracts internationally. They have yet to develop a reputation outside of China,” he said.

China has signaled that it wants to become more aggressive in exporting high-speed rail with state media reporting that it is looking to merge state-owned CNR and CSR to stop the firms from competing against each other overseas. Both firms are keen to supply trains to California’s high-speed rail project.

Last month, CSR rival China CNR won a $567 million contract to supply trains to Boston.

“We bid this on our own costs, and we’re very competitive with the Chinese manufacturers anywhere in the world, so we’ll see how well they do on this contract...I just know we bid it with a margin we were satisfied with,” Beaudoin said.

Writing by Brenda Goh, editing by William Hardy

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