Rail operator SMRT has clinched the operating contract
for the upcoming Thomson-East Coast line (TEL) with a bid that is
30 per cent lower than rival SBS Transit’s.
SMRT submitted a bid of $1.7 billion to run the new
line – which will open from 2019 – for nine years.
In announcing the award Friday (Sept 15) afternoon, the
Land Transport Authority noted that recently privatised SMRT also
scored higher for quality in the tender.
“Its proposal featured a commitment to invest heavily
in predictive and reliability-centred maintenance to enhance
reliability,” said LTA.
“ SMRT Trains also undertook a set of contractual
guarantees in the form of service fee deductions should key
obligations not be met.”
SMRT currently runs the North-South, East-West and
Circle lines as well as the Bukit Panjang LRT.
SBS Transit, despite having a higher rail reliability
track record going by performance statistics in the first half of
this year, lost out. This will relegate it to being a minor player
in the growing rail industry with only about 20 per cent market
share.
SBS Transit, owned by transport giant ComfortDelGro
Corp, currently runs the North-East and Downtown lines as well as
the Sengkang-Punggol LRT.
SBS Transit spokesman Tammy Tan said: “We congratulate
SMRT on being awarded the tender. We are naturally disappointed.
Nevertheless, we remain ever committed to improving our rail
reliability and the performance of our existing lines to continue
to serve our commuters well.”
SMRT’s recent track record has not been impressive,
with trackside fatalities and a higher frequency of delays standing
out. For instance, its eight-year-old Circle Line chalked up one
delay per 518,000 train-km in the first six months, while SBS
Transit’s 14-year-old North East Line clocked one per 978,000
train-km.
Asked how SMRT managed to land the contract despite its
poorer track record, its chairman Seah Moon Ming said: “I think we
have learnt good lessons from all the problems and challenges that
we faced so far. This is a 30-year-old system and is in the process
of renewal and all the problems and challenges we faced we take it
as a good lesson learnt and that is very useful for us especially
for the new line.”
He added that SMRT will hire 600 new people by 2019 for
the TEL. The number could reach 1,500 by 2024.
Last month, SMRT was invited to be part of a
venture to run the cross-border rapid transit link to Johor Baru.
The link is a northern extension of the 43km 31-stop
TEL, which joins Woodlands and East Coast to
the city.
National University of Singapore transport researcher
Lee Der-Horng said: “Even though SMRT has a lot of baggage from the
older North-South, East-West lines, it has no excuse for not having
a better performance with a new line.
“In any case, it has given a contractual promise to meet
performance targets.”
Singapore University of Social Sciences transport
researcher Park Byung Joon said: “The award is based on a promise.
I guess SMRT promised better.”
Meanwhile, the LTA said it will be calling a separate
tender next year for the TEL’s non-fare business – such as rental
of commercial space and advertising. This is the first such
arrangement as all MRT operators also run the non-fare businesses
today.
ST