Replacement of the Montreal Subway's Rolling Stock

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Ranking for 2012: 11

Industry Sector: Transit

Specific Sector: Subway

Range: $1 billion - $5 billion

Project Value: $2,500,000,000

Government Funds Involved: N/A

Funding Source: Public

Location: Montreal, Quebec

Estimated End Date of Substantial Completion: 2018


This project has seen its share of problems associated with the procurement process, including an international scandal, the introduction of specific legislation and even a letter from a foreign head of state. The issue began with the Government of Quebec’s decision that the City of Montreal and Province did not have to tender this project internationally. The justification: because Bombardier and Alstom, who now hold the contract, are the unique supplier of these types of rail cars in Canada, they are exempt from the requirement to use a bidding process. While this may be true, it appears that Spain’s Construcciones y Auxiliar de Ferrocarriles and China’s ZhuZhou Locamotive Ltd. had both expressed interest in bidding on the project. Both have stated that the $2.6 million per car is extraordinarily high. Spain’s Prime Minister José Luis Rodríguez Zapatero even wrote a letter to Quebec Premier Jean Charest expressing his displeasure. The deal has also resulted in a new law in Quebec’s National Assembly awarding the contract to the consortium, but there is still the threat of a legal challenge from the two foreign companies seeking access. An interesting aspect of this contract has been the shift in perspective on the part of the Charest government. In the past, Charest has been a proponent for developing new trade agreements to facilitate this type of contract, but now seems to be taking a more protectionist stance in his own province. Despite ZhuZhou’s purchase of industrial land and commitment to building the cars in Canada for almost $1 million less per unit, the Charest government remained committed to purchasing from Bombardier. Whether this decision will result in future problems for Bombardier internationally has yet to be seen.

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