Foreign cos bid in force for Jerusalem light rail tender

Jerusalem Light Rail  photo: Eyal Izhar

Despite fears, overseas companies have not been deterred by the the new line's politically sensitive route.

The pre-selection stage of the tender for building the second Jerusalem light rail line, which will conclude tomorrow, is believed to be a big success: seven consortia will participate. Each consortium is composed of four companies, most of them foreign. The results have confounded predictions in the sector that the international tender would encounter many difficulties and a lack of response by foreign companies because of political sensitivity to the route of the line, which starts in the Gilo neighborhood and ends on Mount Scopus, places beyond Israel's recognized borders. "Interest among the foreign companies is very great. At least six consortia from all over the world will participate tomorrow, and they are not in the least deterred," a source close to the tender told "Globes." "Participation in the tender is going to be very impressive and respectable."

The huge NIS 9 billion tender includes construction of the second line of the Jerusalem light rail - the Green Line - and extension of the already existing Red Line. Due to the state's disputes with CityPass, the company currently operating the Red Line, the company will not carry out work on the extension. The state will have to repurchase the Red Line operation franchise from CityPass and transfer it to the selected franchise holder. At the same time, it turns out that CityPass is likely to be one of the companies participating in the tender in a consortium that includes Ashtrom Properties Ltd. (TASE:ASPR), Siemens, and Connect. In addition, the consortium winning the tender will also operate the network composed of the two light rail lines: the Red Line and the Green Line.

The threshold conditions for submitting a bid for the tender require each of the consortia to include an operator with proven experience, a construction contractor, a maintenance contractor, and an integrator. Because of concern that foreign operators and integrators with knowledge and experience in building a light rail system would not take part in the tender, the state allowed them to refrain from being partners in the projects' capital and owning a franchise company. The foreign companies will therefore be subcontractors working with private companies, not with the state. "From the standpoint of international law, there is no problem with the Green Line of the railway in Jerusalem, because the state's duty is to provide high-quality transportation for all residents. Already in the past in the Red Line, the French Supreme Court ruled that there were no grounds for concern and no problem in building innovative transportation, and nothing in it that disturbs the political status quo," claims a source involved in managing the tender.

Expected participants in the pre-selection stage, which is scheduled to end tomorrow, include Alstom together with Electra Ltd. (TASE: ELTR), Dan Bus Company, and Spanish company Moventia; Hitachi together with Ansaldo, Minrav Holdings Ltd. (TASE: MNRV) and Kavim; Chinese company CRRC together with Shikun & Binui Holdings Ltd. (TASE: SKBN) and Egged Israel Transport Cooperative Society Ltd.; and other consortia. After receiving the documents, the tenders committee of the master plan for public transportation will announce within a few weeks which consortia passed the first stage, i.e. successfully met the threshold conditions.

The new line will be 19 kilometers long. It will stretch from the Hebrew University of Jerusalem campus on Mount Scopus along Shragai Street, Levi Eshkol Boulevard, Harel Brigade Street, Bar Ilan Street, Sarei Israel Street, Shazar Boulevard (the entrance to the city), the Hebrew University campus on Givat Ram, the Beyth Interchange, Herzog Street, Patt Junction, Dov Joseph Street, and end in the Gilo neighborhood. The line will have 35 stations, and a train will pass every eight minutes. The projected number of daily trips is 120,000. The Red Line, on which the projected daily number of trips was 90,000, currently carries over 200,000 passengers daily.

Published by Globes [online], Israel Business News - - on December 19, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

Jerusalem Light Rail  photo: Eyal Izhar
Jerusalem Light Rail photo: Eyal Izhar
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