Latvia awards 225 million-euro train contract to Spanish manufacturer

Latvia’s state-run railway company Pasažieru Vilciens (PV) has announced that it will buy new electric trains from the Spanish manufacturer Talgo. The deal is worth around 225 million euros and includes delivery of the trains and equipment necessary for their maintenance, spare parts for the first five years and training of the personnel.

“Bids submitted by potential train suppliers were assessed by their projected operational costs over the 35 years the trains will be in service,” said Rodžers Jānis Grigulis, PV’s CEO. “We also took into consideration the schedule for delivery, as well as the costs of daily maintenance, repairs, spare parts, energy consumption and other expenses per passenger seat.”

According to Mr Grigulis “the Talgo offer was about 20 million euros cheaper than the next best bid.”

PV will be purchasing 32 new electric trains with a capacity of 450 passengers on each train. The new trains are set to be delivered between 2020-2023.

In recent years the Latvian government has launched three tenders to purchase new electric trains for the state-run rail operator, each being cancelled after running into legal problems.

The first tender was withdrawn after being awarded to another Spanish company, Construcciones y Auxiliar de Ferrocarriles, following legal proceedings brought by Swiss company Stadler. A second tender awarded the contract to Hyundai, only to be cancelled due to ‘technical reasons’. Anrijs Matīss, then the Latvian minister of transport, said that at the time there was no budget to purchase trains.

On November 5, the government ruled to that PV would be able to invest up to 259 million euros from the state budget by 2024 in the construction of an electric stock of spare parts and train maintenance equipment as well as a train depot.

The new deal may also face a legal challenge.

Škoda Vagonka, a Czech company which also bid for the tender, have said that it is  likely to contest the procurement contract, stating that its initial offer had beaten its closest competition by 10 million euros but was “consciously made more expensive” by ensuing revisions on the part of the Latvian rail company.

Škoda Vagonka’s regional sales director, Roman Sorkin, told Latvian daily Latvijas Avīze: “As we know from the opening procedure that took place on August 6, the next most favourable financial offer was over four per cent more expensive than ours. We have reason to believe that in the subsequent three months, our offer was deliberately made more expensive.

“We are certain that our offer was the most profitable for Latvia, and therefore we will very seriously consider referring the matter to the Latvian Procurement Monitoring Bureau (IUB).

“This is the third attempt by Latvia to buy new suburban passenger electric trains and there should be no shadows of suspicion regarding the process. Any lack of transparency could obscure Latvia’s reputation as a reliable and honest business partner in the international arena,” concluded Mr Sorkin.

Photo: Talgo