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INFORMED SOURCES August 2007

IEP – reality starts to bite.

Time to play ‘hunt the bidders'

Readers may have noticed that the extended coverage of the specification and procurement process for the Intercity Express Programme (IEP) in the May and June magazines was largely free of the rudery, snidery, ad hominem abuse, car park watchers war stories, obscure references and English Electric propaganda which are the hall mark of this column. The reason for this was that I wanted you to see DfT Rail's aspirations and proposals for IEP in the raw, without Captain Deltic nudging you in the ribs.

But now that procurement has begun, normal service is resumed. And the first task is to work how who has submitted Expressions of Interest (EoI) in supplying the train.

Table 1 Potential IEP bidders

Table 1 shows the ten manufacturers who might be expected to have expressed interest in IEP. As you can see it is a work in progress, with only one ‘full-house' consortium – which is the basis of the EoI.

Alstom and Hitachi coyly rebuffed my probing, confirming only that they had submitted an EoI. But Bombardier Siemens, Babcock & Brown and Angel Trains flounced out of the closet, announcing that they had come together in the Express Rail Alliance (ERA) to bid for the IEP 30-35 year train service provision deal. This was a tactically astute move, using the logic behind the alliance to cast doubts on the ability of other would be bidders to stand the pace.

DfT Rail says it will place the contract early in 2009. The 10 5-car pre-series half sets are required to start trial running on the East Coast Main Line in May 2012.

Add in a functional specification that no one expects to meet and designing the three IEP variants involved, let alone building the half sets and getting acceptance, in just over three years will require a massive concentration of resources. As ERA point out, it will not be case of squeezing an existing high speed train into the UK loading gauge. N o manufacturer currently has a suitable train design within an existing ‘platform'.

Actually building the projected 1000 vehicles to replace the IC125 and IC225 high speed trains on the Great Western and East Coast Main Lines by 2010 is not the big problem, although sharing manufacturing resources will reduce delivery risk. What is really going to stretch whoever wins the IEP contract, assuming it ever happens in its present form, is that short term demand on engineering design departments.

Hours

Colin Walton, Chairman of Bombardier Transportation UK reckons that designing and developing a brand new high speed train platform will consume up to 800,000 engineering hours. Chums with experience of designing, admittedly simpler, trains reckon that Colin is laying it on a bit thick, but wouldn't you if you were trying to see off Alstom and Hitachi , let alone the Chinese.

Anyway, if you assume a 40 hour week you get 400 engineer years, most of which will be generated in the 18 months following contract award. And Colin reckons that IEP could see 400 engineers committed full time to one project. So even though they may be OTT, the numbers are internally consistent.

But whatever the design load, the winning builder will be designing sundry other trains for more rational European operators, and for export, at the same time as IEP is hanging round their neck.. And there's another rub. IEP is going to have little or no sales potential outside Britain .

But surely every railway operator will want to buy DfT Rail's all-singing, all-dancing dream train with its laws of physics defying specification? Well, Siemens for one don't think so. Christian Roth, the company's Chief Executive in the UK explained that apart from the restricted loading gauge, the overall specification does not meet national preferences embodied in existing high speed trains such as the German ICE and the French TGV.

Friends

While historically rivals in Britain , Bombardier and Siemens have a long record of joint ventures eslewhere. They have collaborated on two metros in China , plus S-Bahn vehicles and the InterCity Express (ICE) series of high speed trains in Germany .

Within ERA, Bombardier's Litchurch Lane plant at Derby would take the lead on IEP design. Derby engineers would be supported by engineers at both companies' factories in Germany . Manufacturer would also be shared, although capacity for series production capacity is not seen as a constraint.

Clverly, Bombardier and Siemens have also listed the commercial members of their consortium. Angel Trains not only does finance, it has powerful engineering and maintenance teams. Babcock & Brown also know their way round the UK rail market. Note finally, that Siemens is bidding as Siemsns Project Ventures rather than Transportation Projects.

Singles

There is not a lot to say about the other confirmed entries. DfT Rail is heavily into cultural cringe and I suspect that they are hoping that Hitachi comes up with some amazing world class technology to produce a train which is fully compliant at an affordable price. However, according to an old German proverb I picked up talking to Siemens, ‘Auch Japaner kochen nur mit Wasser'. In other words, tensile strengths are the same for every engineer.

Also in the Table is Kawasaki , known in this country for the unsuccessful flexible bogies for London Underground (the result of more cultural techno cringe). Japanese companies are very careful not to trip over each other in export markets, so I doubt that Kawasaki will have expressed interest. On the other hand they could well be a ‘silent' partner in a ‘Japan Inc', providing additional design resources.

Strengthening Hitachi 's hand is the available of substantial Japanese funds in Europe seeking a home. You can see this in the very competitive loans available to buyers of Japanese cars at the moment.

Alstom is in a pickle on IEP. The Class 458 debacle meant it missed out on the EMU boom. Bombardier was up and running with Turbostar where the class 170 flopped. With nothing to build after the Pendolino contract it shut down its train building factory at Washwood Heath Birmingham. Speculative builds of 458s and 180s also crashed an burned.

Yet Alstom has the only living example of the long term train service provision Special Purpose Vehicle to which DfT Rail aspires for IEP. This is the Northern line fleet, the contract for which is currently being renegotiated to build in some incentives to improve reliability.

But culturally, I can't see French Alstom embracing the IEP ethos. Think how long it has taken for TGV to even trial distributed power in the form of the AGV.

However, all is not lost. The Class 390 Pendolino, while weighed down by its bogies, could provide the basis for a lightweight non-tilting articulated train. And articulation is gaining adherences as notional design parameters are run through the various vehicle/track interaction and whole life costs models.

Sorry, that was a bit of blatant straw clinging. I suspect the attitude when push comes to shove will echo Marie Antoinette's ‘let them buy AGV'.

Which leaves the wild Card, led by the Chinese manufacturer CSR Ziyang, which has been trying to sell diesel multiple units in Britain for some time now. CSR can draw on the manufactring facioities of its sister company CSR Nanjing Puzhen.

Within its consortium CSR has some useful, credible European players in design and maitenance management. While it is fashionable to write off the Chinese we should not forget that when the Advanced Passenger Train proved a risk too far, the conventional High Speed Train saved the day. So what price a genuine HST2?

Others

Of the known unknowns, I would guess that the project is too big, too complex and too risky to appeal to Ansaldo Bred. Rotem of Korea, which has entered the European market via Ireland , is reported to have some major project on the boil.

My personal tip was that the rumoured fifth major consortium could be built around CAF and Talgo of Spain. CAF has first hand experience in Ireland and second hand experience in England as the assembler of the Class 332 and 333 Siemens EMUs. But Informed Sources suggest otherwise.

So much for manufacture. When it comes to train service provision, Alstom, Bombardier and Siemens are already running Depots and Hitachi will soon join them the Class 395 Javelins.

Which leaves the unloved ROSCOs. We know that Angel has joined the grand alliance. HSBC Rail is known to be involved but won't say with whom. The procurement of the Class 395 fleet and the replacement Hitachi traction packages for HSBC's Networkers might provide a clue.

Porterbrook appears to be out in the cold, reflecting the fact that IEP Procurement does not match the classic ROSCO model of procuring and financing the train which the client wants to lease and taking residual risk.

With IEP procurement is based on a complete package covering manufacture, maintenance and finance over a 30-35 year period, ROSCOs can only join in if they are prepared to deal exclusively with one manufacturer. But, according to informed sources, some manufacturers wouldn't give details of the proposed wonder train before the EoI went in, which makes an exclusive deal a bit chancy.

So unless you are really close to a manufacturer, as with Angel and Siemens, joining an IEP SPV is a bit dicey for a ROSCO. Especially when you would be contributing to the sizeable chunk proportion of the engineering hours which will have to be spent to produce a credible bid.

Finally wheels are starting to come off. According to Informed Sources only one fully compliant EoI was submitted by the deadline, which had to be extended by 10 days. During this period DfT Rail was chasing up firms for supplementary information.

Continues.........