Ansaldo Honolulu wins the bid to build the city transit cars for $574 million, and will also operate and maintain the system
POSTED: 01:30 a.m. HST, Mar 22, 2011
LAST UPDATED: 01:53 a.m. HST, Mar 22, 2011
The 80 rail transit cars for the city's $5.5 billion project will cost $574 million to build.
The city said yesterday that Ansaldo Honolulu was the winning bidder to design, build, operate and maintain the system.
Mayor Peter Carlisle also announced that the contractor for the first phase of the route, Kiewit Infrastructure West Co., will also design and build the second phase, from Pearl Highlands to Aloha Stadium. That contract will cost $372 million.
Combined with the first two contracts for the first phase ($482 million) and the maintenance and storage facility ($195 million), so far about $1.6 billion in contracts has been awarded for the project.
Carlisle touted a savings of $315 million between three of the four contracts. The bid for the second phase went about $53 million more than what the city anticipated to spend.
"This contributes significantly to the confidence and stability of our financial plan," Carlisle said. "That is news that they're going to look at in Washington, D.C., and be very, very impressed that we are in fact on time and under budget."
Ansaldo Honolulu is a joint venture between two Italian-based transit companies, Ansaldo Breda and Ansaldo STS. Two other bidders submitted price tags higher than Ansaldo's final offer:
» Canadian-based Bombardier Transportation, which has more than 100,000 vehicles in operation in 25 nations, submitted a proposal for $697.3 million.
» A consortium led by New York-based Sumitomo Corp. of America submitted a $688.8 million proposal. Sumitomo has more than 20 years of experience installing commuter rail cars in the U.S.
In an earlier proposal in June, Ansaldo gave a $679.8 million price tag. Its revised, winning proposal was submitted last month.
The contract allows Ansaldo to operate and maintain the vehicles for five years and gives the city the option to extend the contract for five more years.
The company is proposing that operating and maintaining the system for those five years will cost about $167 million. Toru Hamayasu, who heads the city Rapid Transit Division, said that proposal is still up for negotiations.
If it is given a notice to proceed work next month, Ansaldo expects to complete the project by March 15, 2019, according to its proposal. The cars will be designed in the company's engineering department in Pistoia, Italy.
Each train will consist of two 64-foot-long cars, with each car expected to weigh about 72,000 pounds.
The city expects to spend about $10.5 million in rail car components during fiscal 2012, according to its proposed budget for the yet-to-be-formed Honolulu Authority for Rapid Transportation.
Carlisle said he expects to award the contract to build the third phase of the route by the end of the year. Each of the 21 stations will be designed and built through separate contracts, he said.
Several union leaders flanked Carlisle yesterday as he made the announcement in a press conference. They reported high unemployment and reduced hours for many of their members.
"Our union is currently 50 percent unemployed and has been that way for the last several years," said Ron Taketa of the Hawaii Carpenters Union.
Taketa said until union members return to work, state and county governments will continue to experience budget shortfalls.
When asked whether the city would lower the official price tag of the project down from $5.5 billion, Carlisle said no.
"We're not at the end yet," he said, pointing out that Kiewit's contract for the 3.9-mile second phase was higher than expected.
That contract includes rail alignment, track installation and restoration of the road surface along the route.
The city still faces a legal challenge this week. Paulette Kaleikini, represented by the Native Hawaiian Legal Corp., is seeking a preliminary injunction on the project. She hopes to stop the project until an archaeological inventory survey is conducted on the fourth phase in Kakaako, where many ancient burials are expected to be found.
A hearing on the preliminary injunction will be held tomorrow in Circuit Court.
Cliff Slater, among the more prominent critics of the project, said he feels the city awarded these contracts to convey the feeling that the project is a done deal. At the moment, the federal government has given the city permission to only begin relocating utilities and acquiring property.
He also noted that although $1.6 billion in contracts has been awarded, the federal government has yet to commit funding.
"Guideway construction is a year away," Slater said. "What is the function of awarding contracts this early?"