Northern Ontario Business - Trainmaker in intense talks with TTC

By KELLY LOUISEIZE

Howard Moscoe is passionate about spending public dollars in Ontario.

A contract for the double-decker cars would sustain a lot of jobs.

“I don’t want to build my cars in a communist regime,” says the chair of the Toronto Transit Commission.

“I want to make my cars where it benefits Canadian workers. I am not going to allow millions and millions of dollars to flip out of the country just because Siemens, a German company, wants to make our cars in China.”

Moscoe says he will buy shirts made in China, but not vehicles that will eventually require servicing and parts.

The TTC is continuing exclusive negotiations with Bombardier on the design and price of approximately 230 replacement cars over five years with a budget of $705 million. The work would be done at the Thunder Bay facility.

German rival Siemens says they can produce the same subway car for less money. Mario Peloquin, Siemens’s director of business development says they have not seen the TTC specifications, but through “intelligence gathering” they perceive the model will be designed much like the Chinese car.

Siemens’ presence in Ontario consists of five administrative employees, but Peloquin says those numbers will increase if they are found to be successful bidders in a number of Ontario projects. He says a document submitted to the TTC guarantees the company would do as much work in Ontario as possible in a new final assembly plant that could create up to 100 jobs. Possible plant locations have not been disclosed. However, most of the manufacturing would take place in China where labour costs are significantly lower.

“We are trying to become more of a local player in Canada,” Peloquin says.

Moscoe, who has not responded to Siemens with an official reply says “that doesn’t impress me.”

Negotiations between Bombardier and the TTC have been placed on a six-month time limit. If the transit system does not obtain satisfactory negotiations “we will go to the market.”

It is an incentive to ensure Bombardier tallies in at a fair price, Moscoe says.

A third party will audit the company’s bid to ensure it is competitive with other similar contracts.

The only way the exclusive discussions will be terminated is if Bombardier asks for too much money, Canadian Autoworkers Local 1075 president Paul Pugh says. “If they don’t (measure up) the deal is off,” Pugh says.

Such a contract would bring back up to 350 people in addition to the current workforce of just fewer than 400. BiLevel cars are a steady seller, something that has kept the plant going through financial hardships. Pugh expects a steady flow of contracts will continue as the plant employees begin work on the subway cars destined for Toronto.

“This plant could be doing very well for the next five years. There is a ton of work. That is why I am guardedly optimistic. The worst is over.”

He expects to see a workforce of about 900 by this time next year, almost the same amount of employees they had before the massive layoff almost three years back. Once Montreal gives the OK, it will take six to eight months before the plant kicks into full production mode.

Toronto is also looking to place another order for 150 refurbished and 100 new light streetcars.

A report at the next TTC executive meeting will detail how the board will proceed, but Moscoe says the contract will be open for tender. Siemens will have an opportunity to bid.