Alstom: Light rail tender withdrawal not political

Jerusalem light rail

Alstom cites differences of opinion with its Dan and Electra, its consortium partners.

The reason for the disintegration of the Alstom-Dan-Electra consortium, which was to have bid in the J-Net tender for construction of the light rail Green Line and extension of the Red Line in Jerusalem, was internal disagreements, not politics, according to a letter that French company Alstom sent today to its two Israeli partners. "Globes" has obtained a copy of the letter.

Alstom was a key partner in one of the three consortia that were to have bid in the tender, in which only two bids were actually submitted this week. One of the bids was by a consortium consisting of Israeli company Shapir Engineering and Industry, Spanish company CAF, and Superbus, and the second was by a consortium consisting of Shikun & Binui and Egged. Following the failure of Alstom's consortium to submit a bid, infrastructure sector sources asserted that political pressure on Alstom was responsible, but the reason now appears to be disputes between the partners.

"We greatly regret your decision not to bid in this tender, which came as a surprise," the letter begins, stating afterwards that there are no grounds for saying that Alstom was the one to withdraw from the project. "We simply do not understand the rationale for such an assumption, considering the magnitude of Alstom’s investment, both financial, technical, commercial and in terms of resources, over more than a year," the letter states. Alstom was also a partner in Jerusalem light rail franchise holder CityPass, but later sold its share, while continuing to supply carriages for the light rail. Alstom is involved in additional mass transit projects in Israel, mostly in the Tel Aviv area.

Alstom reveals in its letter that agreements were reached between the consortium members just before the May 12 date for submitting bids, but these agreements were apparently not fulfilled. "…we can only reject any and all claims that Alstom acted in bad faith or breached its obligations," the letter states.

The disavowal of political motives was also designed to allow Alstom to continue its activity in Israel outside Jerusalem. Jerusalem Mayor Moshe Lion was the first politician to call for excluding Alstom from other transportation tenders for allegedly boycotting the tender in Jerusalem, and such pressure is likely to increase in future tenders.

Published by Globes, Israel business news - en.globes.co.il - on May 16, 2019

© Copyright of Globes Publisher Itonut (1983) Ltd. 2019

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Jerusalem light rail
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