Train suppliers in the dark on job's local content

Wayne Butson. Photo / Hawke's Bay Today

KiwiRail is keeping international suppliers guessing over whether they will be required to include local content in Auckland's new electric trains.

The company, which is holding a confidential industry briefing in Auckland today on a call for expressions of interest in supplying 38 trains under a $500 million Government Budget allocation, has yet to disclose whether it will make local content a contractual requirement.

Although it has ruled out building the trains in New Zealand, as sought by a union campaign, its expressions-of-interest document says international suppliers are "encouraged to ally themselves with" local subcontractors in responding to the call.

"KiwiRail is seeking for respondents to evaluate opportunities for local industry participation and, where efficient and cost-effective, including as much New Zealand content and resources in the design, construction, delivery, testing, maintenance and support of the EMUs [electric trains] as possible," the document said.

It also suggests local content could give international suppliers an option to secure a local base from which to provide a cost-efficient maintenance service for KiwiRail and the new Auckland Transport agency to run passenger services under the Super City.

The document stops short of requiring suppliers wanting to be short-listed for a contract, to be signed early next year, to offer any local content.

But in answer to a question posted anonymously this week on the government tenders website, KiwiRail said local content may form part of its evaluation criteria when short-listed suppliers were invited to make formal tenders by a "request for proposal" document due in July.

KiwiRail would not indicate how many potential suppliers were registered for today's industry briefing.

Rail and Maritime Transport Union general secretary Wayne Butson said yesterday that suppliers would be confused by mixed signals from KiwiRail and the Government.

"I think it would be easier for everyone if the Government and KiwiRail came out and were specific about what they wanted to do," he said.

"I just can't believe a country the size of New Zealand doesn't have it written ... in our policies and procedures that when we make an order of a certain size, there must be such and such a percentage of local content."

Although he acknowledged New Zealand firms would probably not be able to compete on "top letter" items for Auckland's trains, he believed some components could be available locally.

Observers hope today's conference will provide more clarity about KiwiRail's expectations before expressions of interest close on June 11.

KiwiRail has stipulated that Auckland's new trains must be capable of running through proposed tunnels under Waitemata Harbour and the central business district to Mt Eden, and attain a maximum speed of 110km/h.

It wants the first train to arrive in Auckland fully tested early in 2013, and the rest of the fleet must be in service by the following year.