Talgo appeals result of train tender with procurement watchdog

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Spanish company Patentes Talgo S.L. (Talgo) has lodged an appeal with the Public Procurement Monitoring Bureau contesting the result of a tender to supply new passenger trains to Latvia’s Pasažieru Vilciens rail company, according to information posted on the bureau’s website.

The deadline for hearing the appeal is yet to be set.

Pasažieru Vilciens CEO Rodzers Janis Grigulis told members of the Saeima Public Expenditure and Audit Committee that after Pasažieru Vilciens decided to purchase the new electric trains from the Czech company Skoda Vagonka, Talgo appealed the result of the tender to the Administrative Court and the Public Procurement Monitoring Bureau.

“We have to provide our explanation by March 6. We are working on it and will meet the deadline,” Grigulis said.

The contract price will be EUR 241,888,000.

As previously reported, on reassessing the bids submitted in its train supply tender, Latvia’s Pasažieru Vilciens rail passenger carrier has decided to purchase the electric trains from the Czech company Skoda Vagonka, the company’s CEO Rodzers Grigulis told journalists Friday.

Grigulis said that the winner of the tender was changed because Pasažieru Vilciens heeded the Public Procurement Monitoring Bureau’s advice to consider a different electricity price. The new lifecycle cost analysis showed that the offer of Skoda Vagonka was more economical. The participants of the tender were not allowed to change their bids during the reassessment.

Grigulis indicated that the tender’s original winner, Spanish company Talgo, had offered to supply the trains for a lower price but that the maintenance costs offered by Skoda Vagonka for the trains’ 35-year lifecycle were lower, which meant lower overall costs.

Previously, Pasažieru Vilciens declared Spain’s Talgo the winner of the train tender, but the Public Procurement Monitoring Bureau banned Pasažieru Vilciens from concluding the contract with this company and ordered the rail company to invalidate the results of its electric train tender.

As reported, Spanish company Talgo won the tender to supply new passenger trains to Pasažieru Vilciens for EUR 225,303,262. The contract price included delivery of the trains and the equipment necessary for their maintenance, spare parts for the first five years and training of the personnel.

Pasažieru Vilciens CEO Rodzers Janis Grigulis said that the bid submitted by the Spanish company was economically the most feasible for the train’s projected service life of 35 years. Asked about the prices offered by other bidders, Grigulis said that the next best offer had been EUR 20 million costlier.

Pasažieru Vilciens in September 2015 started a new tender to purchase electric trains, and four bidders had advanced to the second stage of the tender – Spanish company Talgo, Polish subsidiary of Swiss company Stadler, Spanish company Construcciones y Auxiliar de Ferrocarriles S.A. (CAF), and Czech company Skoda Vagonka.

Pasažieru Vilciens was established in 2001 to separate domestic passenger services from other functions performed by the state-owned Latvijas Dzelzcels (Latvian Railway). Although initially Pasažieru Vilciens was a 100-percent owned subsidiary of the Latvian Railway, in October 2008 it was transformed into an independent state-owned company.

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