Support The Moscow Times!

Russian Train Maker Wins $2.6 Billion Moscow Metro Tender After Foreign Firms Back Out

Russian train maker Metrovagonmash has won a massive international tender to supply 96 trains for the Moscow metro after major foreign producers including Siemens and Bombardier shied away from taking part, the TASS news agency reported late last week citing tender documents.

Metrovagonmash, a subsidiary of Russia's biggest rail car and equipment producer Transmashholding, offered to supply the new trains and service them over a 30-year period for just over 130 billion rubles ($2.6 billion), 2 billion rubles under the starting price, the tender documents said.

The company, which has been the metro's sole train supplier since the 1930s, was the only bidder. Although major foreign train makers such as Siemens, Bombardier, Alstom, CAF and Hyundai earlier expressed interest in the tender, none participated.

In February, Metrovagonmash won a similar tender to supply and service 832 metro cars, also worth about $3 billion. That contest too was open to international bidders, but again no foreign manufacturers entered bids.

Speaking before journalists earlier this month, Dietrich Moeller, the head of Siemens Russia, said the requirements of the upcoming metro tender were "harsher" than similar supply contests the company participates in around the world, and expressed doubts that Siemens could win.

One of the tender's requirements was to localize over 70 percent of train production in Russia, which none of the foreign train manufacturers were immediately able to meet.

Canada's Bombardier, Russia's Uralvagonzavod and a joint venture of Russia's Sinara and Spain's CAF last week wrote a letter to the Russia's antitrust watchdog complaining that the tender had been designed to benefit a single bidder, business daily Kommersant reported.

Transmashholding was until recently part-owned by Maxim Liksutov, who is now Moscow's deputy mayor and the head of City Hall's transportation department, where he is responsible for infrastructure projects and rolling stock contracts. Liksutov sold his stake in 2012 after entering City Hall to comply with a law prohibiting government officials from involvement in business activity.

Russia's state rail company, Russian Railways, owns a 25 percent stake in Transmashholding. France's Alstom also owns 25 percent, and businessmen Iskander Makhmudov and Andrei Bokaryov hold a controlling stake of 50 percent plus one share.

Contact the author at a.panin@imedia.ru

Sign up for our free weekly newsletter

Our weekly newsletter contains a hand-picked selection of news, features, analysiss and more from The Moscow Times. You will receive it in your mailbox every Friday. Never miss the latest news from Russia. Preview
Subscribers agree to the Privacy Policy

A Message from The Moscow Times:

Dear readers,

We are facing unprecedented challenges. Russia's Prosecutor General's Office has designated The Moscow Times as an "undesirable" organization, criminalizing our work and putting our staff at risk of prosecution. This follows our earlier unjust labeling as a "foreign agent."

These actions are direct attempts to silence independent journalism in Russia. The authorities claim our work "discredits the decisions of the Russian leadership." We see things differently: we strive to provide accurate, unbiased reporting on Russia.

We, the journalists of The Moscow Times, refuse to be silenced. But to continue our work, we need your help.

Your support, no matter how small, makes a world of difference. If you can, please support us monthly starting from just $2. It's quick to set up, and every contribution makes a significant impact.

By supporting The Moscow Times, you're defending open, independent journalism in the face of repression. Thank you for standing with us.

Once
Monthly
Annual
Continue
paiment methods
Not ready to support today?
Remind me later.

Read more