All three levels of government have given TTC staff permission to negotiate a sole-source contract with Alstom for the new fleet of Line 2 Bloor-Danforth subway trains, citing economic challenges.
According to a statement issued by the TTC on Friday morning, the current open bidding process has been cancelled.
“In the face of U.S. tariffs and economic uncertainty, this decision will support Canadian and Ontario workers with good manufacturing jobs and ensure reliable trains for Toronto transit riders,” officials said in the statement.
The move followed months of pressure to award the deal to Alstom, which has a large plant in Thunder Bay. It is the only major manufacturer in Canada currently.
Critics of sole-source contracts have generally argued that such deals could inflate the price beyond the current market conditions.
TTC staff said conditions are being put in place as part of the talks with Alstom to ensure the company “delivers state-of-the-art trains at a fair market price, maximizes the creation of Canadian jobs, and benefits Toronto.”
They said any deal with Alstom must result in a product that’s “compliant with the TTC’s original requirements,” “maximize Canadian content and create Canadian jobs,” and the pricing must be subject to an “independent third-party market price assessment.”
Officials said talks between the TTC and Alstom are expected to happen over the coming months, and the transit agency’s board is due to receive an update before the end of the year.
TTC staff are looking to put in a base order of 70 six-car trainsets with 55 going to replace existing Line 2 trainsets and 15 new ones to boost service for when the Yonge North and Scarborough extensions open to the public (currently expected to happen in the early 2030s).
TTC officials pegged the cost of the 55 Line 2 trains is $2.27 billion, split three ways between the City of Toronto, the Ontario government and the Government of Canada. They also said a state-of-good-repair program worth $163 million would be needed to help the remaining part of the fleet stay operational until all the new trains arrive.
“The contract would include options to procure additional trains to meet future needs when funding is committed and subject to Alstom’s performance,” the statement added.
“The TTC is working diligently to ensure the aging Line 2 fleet operates safely and reliably until new trains arrive.”
Unifor, the largest trade union in Canada, called the decision “a great victory” in the face of the current economic difficulties.
“We must use our Canadian procurement dollars to support Canadian workers and Canadian-made products, especially given the current trade war,” said Unifor National President Lana Payne in a statement.
“This decision to formally award this contract to Alstom speaks volumes with respect to how we must support Canadian workers, local industries, economies and communities. We need to see more of this if we are to build a more resilient Canadian economy.”
The path to acquiring the new trains for Line 2 hasn’t been an easy one, amid earlier delays in securing the necessary funding from the federal government.
The massive task of overhauling the Bloor-Danforth line started in 2020. The TTC began setting aside funds to replace the current Line 2 signalling system, parts of which were installed in the 1960s, with automatic train control. Upgrades at the transit agency’s Greenwood subway yard, including the replacement of all trains, were envisioned to be part of the project.
“Although this system is safe, its reliability is declining despite extensive preventive and corrective maintenance efforts,” staff said in an earlier report, referencing the current fixed-block signal system, which will be close to 70 years old in certain areas by the earlier anticipated time of full replacement in 2035.
Staff noted that all the elements of the project need to happen together to go ahead with the overhaul and eventual expansion of service. The initiatives were “anchored on the timely procurement of new subway trains.”
Fast-forward to mid-2023, when the transit agency cancelled a bid involving four bidders for 80 trains (55 replacement ones on Line 2 and 25 to expand capacity on Line 1) due to not having enough money.
