Industry: Another failed bidding for MRT-3 maintenance deal

The Department of Transportation and Communications (DOTC) bids committee will have to declare a failed bidding for the P2.4-billion Metro Rail Transit System Line 3 (MRT 3) maintenance project after finding no takers for the deal.

In a statement, DOTC secretary Joseph Emilio A. Abaya said: “No one procured the documents so obviously no one submitted a bid.”

This was the second time since October 2014 that the government tried to look for an investor to maintain the congested railway system. 

The maintenance contract was auctioned off under a single-stage bidding process, where interested bidders submit qualification documents at the same time they make their technical and financial offer. Interested groups had been told earlier that they can buy bid documents from December 14, 2014 to January 20 this year. The bidding was held yesterday.

“The BAC is convening and basically will declare a failure of bid,” said Mr. Abaya.

At the failed bidding last October, none of the five prospective bidders—the Busan Transport Corp., Mosan-Inekon Phils. Ltd. Co., SMRT International Pte. Ltd., Miescorrail, Inc. and D.M. Consunji, Inc.—showed up on the day of the auction.

The unsuccessful second attempt to bid out the contract this month came even as the government made the rules governing penalties for technical glitches less stringent.

According to Mr. Abaya, they even adjusted the key performance indices to entice bidders.

“Before, during peak hours, there should be 20 trains, but when it’s off peak, there should be 15. They have a lot of apprehensions, so we made it 12 instead so they only get penalized when trains drop below 12 during off peak and peak hours,” he explained, adding that rules governing fines had also been relaxed.

“Before, the penalty is per hour, now we made it once every five hours,” he said.

Supposedly, the deal was to be financed under the General Appropriations Act of 2014, which raised the budget of the contract by P200 million to P2.4 billion spread over three years or an annual P800 million.

 The government currently pays APT Global just P57 million a month, or P684 million per year, as an interim contractor.

APT Global will continue maintaining the rail system until the government awards the three-year contract to a new service provider.

Mr. Abaya said the DOTC has not yet received any unsolicited proposal for the MRT-3 rehab, which is separate from the maintenance contract.

In December, both Metro Pacific Investments Corp. and Sumitomo Corp.-MRT Corp. group said they will submit a proposal to rehabilitate and upgrade the MRT-3.