Friday, January 11, 2013

MBTA anger with Hyundai Rotem heats up

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Reports from Boston-area print and television media Friday say Massachusetts Bay Transportation Authority (MBTA) is running short of patience over continuing delays of bilevel rail passenger equipment deliveries from Hyundai Rotem.

An MBTA spokesperson queried by the Boston Globe acknowledged MBTA had delivered a letter to Hyundai Rotem Dec. 21 lamenting continued delivery delays, as well as over concerns of construction quality of the 75 cars on order.

Boston-area television and radio media at midday Friday reportedly painted an even grimmer picture, stating MBTA was on the verge of canceling its $190 million order, and seek a new supplier for its needs.

The Dec. 21 MBTA letter does offer termination as a possibility, stating, "Failing dramatic improvement and immediate corrective measures designed to remedy these defaults ... the MBTA must consider terminating the contract for cause."

All 75 cars were supposed to be delivered to MBTA by the end of 2012, but Hyundai Rotem experienced production problems at its Philadelphia plant, including labor unrest, in manufacturing 120 Silverliner V electric multiple-units (EMUs) for the Southeast Pennsylvania Transportation Authority (SEPTA). The SEPTA order was at or near completion as 2013 began; MBTA to date has received just four of its 75-car order.

Last June Hyundai Rotem CEO M.H. Lee apologized to the MBTA Board of Directors, vowing to expedite delivery, and by fall MBTA officials were suggesting progress was being made. In September, MBTA Acting General Manager Jonathan Davis traveled to South Korea to meet with CEO Lee and to track the supplier's progress in remedying the delay at the company's plant in Changwon. Hyundai-Rotem's Lee died in November, which some suggest may possibly complicate the situation.