Lack of bidders forces HS2 to rethink £1.5bn track deal

Grant Prior 1 week ago
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HS2 is revising a £1.5bn track and overhead power deal following “increasing concern” from contractors over risk transfer.

Project leaders will now hold an open day next month to gauge industry concerns over the scheme.

An OJEU notice stated: “HS2 Ltd is hosting an Industry Day on 3.9.2019 to re-engage with the market and launch its revised strategy based on market appetite and conditions.

“HS2 have recognised the current market conditions are challenging and the increasing concern regarding risk transfer and have therefore revised our position to provide a better balance and overall outcome.

“The industry day will provide an opportunity to re-engage with the market and outline our revised strategy which we believe will attract a larger number of bidders, reduce risk and thereby produce a more competitive process.”

The original contract race was launched in January 2018 with HS2 looking for at least four bidders.

The deal covers the route from London through to Crewe to provide the overhead catenary system.

The vast contract also includes construction work within stations and in tunnels including supply of engineering trains to link worksites as well as design integration and co-ordination with other railway systems, civil engineering and station construction contractors.

An HS2 spokesperson said: “We are currently revising our approach to the procurement of our Railway Systems contracts in order to increase competition and reduce risk for our contractors.

“These contracts cover our track and overhead catenary systems as well as tunnel and lineside mechanical and electrical work.

“Taking these decisions now will help us deliver contracts which, in the long term, deliver best value for HS2 and the taxpayer.”

HS2 was forced to cancel the bid race for its £435m Curzon Street station job last month due to a lack of interest from contractors.

 

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