Cambrian Rail Partnership No.1 LLP for the manufacture, supply, maintenance and leasing of 11 x 4-car class 231 diesel electric multiple units ("DeMUs")

Concepts

• rail parts
• cambrian rail partnership no.
• rhondda cynon taf
• pontypridd
• llp
• manufacture
• maintenance
• stadler rail service uk
• 4-car class
• leasing

Location

Wales and parts of England

Description

Cambrian Rail Partnership No.1 LLP for the manufacture, supply, maintenance and leasing of 11 x 4-car class 231 diesel electric multiple units ("DeMUs")

Total Quantity or Scope

Cambrian Rail Partnership No.1 LLP for the manufacture, supply, maintenance and leasing of 11 x 4-car class 231 diesel electric multiple units (“DeMUs”) Additional information: This award is a variation of existing contracts originally between Keolis Amey Operations / Gweithrediadau Keolis Amey Limited (“KA”), the then operator of Wales and Borders Franchise and Cambrian Rail Partnership No.1 LLP, Stadler Bussnang A.G and Stadler Rail Service UK Limited for the manufacture, supply, maintenance and leasing of 11 x 4-car class 231 diesel electric multiple units ("DeMUs").

Award Detail

Renewal Options

TfW will either-1.purchase DeMUs in 2033 for a fixed residual value ("RV") sum, or lease them until at least 2048 (or pay a termination sum); or 2.if not purchased in 2033, purchase the DeMUs in 2048 for a fixed RV sum, or lease them until at least 2058 (or pay a termination sum); and 3.if it has not purchased DeMUs in 2048, purchase them in 2058 for their then market value

Award Criteria

CPV Codes

• 34600000 - Railway and tramway locomotives and rolling stock and associated parts

Indicators

• Options are available.

Legal Justification

Due to TfWRL "stepping in" in place of KA as operator of last resort and the consequent transfer of maintenance staff to the public sector, it has become necessary to re-negotiate the maintenance arrangements agreed by KA for the DeMUs with the Owners, as set out in more detail in the "Additional Information" section. The Owners have certain exclusive rights (in particular intellectual property rights in the design of the DeMUs) and contractual rights under the existing maintenance arrangements. As a condition of agreeing to the revised maintenance arrangements, the Owners require protection against the additional risks that the revised arrangements present, as set out in more detail in the "Additional information" section. Accordingly, TfWRL, TfW and/or WM are entitled to enter into the revised arrangements under Reg. 32(2)(b)(iii) PCR / Reg. 50(2)(b)(iii) UCR (protection of exclusive rights). Further or in the alternative, it would not be practically possible from an IP ownership perspective nor a technical perspective for anyone other than Stadler to carry out the hybridisation work, or to carry out the revised maintenance service and role. Accordingly, WM, TfW and/or TfWRL are also entitled to rely on reg. 32(2)(b)(ii) PCR / reg. 50(2)(b)(ii) UCR (competition is absent for technical reasons). The rationale is set out in more detail in the "Additional Information" section.

Other Information

** PREVIEW NOTICE, please check Find a Tender for full details. ** Due to Covid-19 restrictions/related matters, TfWRL replaced KA in February 2021 under s.30 of the Railways Act 1993. TfWRL and parent TfW are contracting authorities and also utilities in relation to the rail network. Welsh Ministers (WM) are a contracting authority. Due to WMs' and TfW's decision to keep in the public sector maintenance workers who had transferred from KA to TfWRL under TUPE, changes were negotiated to the maintenance agreements associated with the DeMUs so that the agreements become Technical Support and Spares Supply Agreements (TSSSAs) instead of Train Services Agreements (TSAs), with TfWRL taking over the role of the maintainer of the DeMUs. TfWRL replaces SRS UK as maintainer, with SRS UK taking on a technical support and spares supply role. As a result, some knock-on amendments to the Manufacture and Supply Agreements (MSAs) are also required to bring them in line with the change in maintenance arrangements. In addition, as part of its de-carbonisation programme, Welsh Ministers require that the DeMUs be converted to hybrid diesel-electric vehicles ("hybridisation") and the parties will work together to agree a hybridisation programme by January 2023. As a consequence of these changes, and to protect the Owners of the DeMUs from additional risks involved in the move from a TSA to a TSSSA (in particular re: their ability to re-lease the DeMUs at the backstop date in the Protected Rolling Stock Letters (a form of assurance provided by Welsh Ministers to the Owners), being 16 October 2033) the parties have agreed that TfW must: - purchase the DeMUs in 2033 for a fixed RV sum, or instead (at its option) lease them for a period until at least 2048 (or pay a termination sum); or - if it has not purchased the DeMUs in 2033, purchase them in 2048 for a fixed RV sum, or instead (at its option) lease them for a period until at least 2058 (or pay a termination sum); and - if it has not purchased the DeMUs in 2048, purchase them in 2058 for a sum representing the market value of the DeMUs at that time. If the conditions for hybridisation are not satisfied by an agreed deadline or TfW decide not to proceed with hybridisation conversion works by an agreed deadline, the parties will either: - continue with the TSSSA maintenance arrangements (with compensation/additional protections for the Owner to reflect the impact of a TSSSA rather than a TSA to be agreed); or -revert to the existing TSA for both the DeMUs and the fleet of Tri-Mode Units owned by Valley 1 Rail Partnership No.1 LLP (given their practical maintenance links) (with the Owner being compensated for the impact of having the TSSSA in place in the interim). As noted above, the extension to 2058 of the period during which TfW undertake to pay a termination sum unless the units remain on lease has been made on the basis to protect the Owner from the additional risks involved in the move from a TSA to a TSSSA, and is made on the basis of the protection of the exclusive rights of the Owner as the owner of the DeMUs. As Stadler owns the Intellectual Property in the DeMUs, and is the original supplier of the DeMUs, the parties jointly agree that in order to protect the exclusive rights of Stadler, Stadler will undertake the hybridisation works, and will provide the revised TSSSA services (and assist TfW in providing the revised maintenance arrangements). It would not be practically possible from an IP ownership perspective nor a technical perspective for anyone other than Stadler to carry out the hybridisation work, or to carry out the strategic TSSSA service and role. Further or in the alternative, WM, TfW and TfWRL are entitled to rely on reg. 32(2)(b)(ii) PCR / reg. 50(2)(b)(ii) UCR (competition is absent for technical reasons) for the reasons stated above. (WA Ref:127497)