The TTC has decided to sue Bombardier for $50 million dollars in damages after delays in delivering new streetcars.
The TTC board decided on legal action at its Oct. 28 meeting.
The $50-million figure comes from the liquidated damages clause in the contract with Bombardier, according to Brad Ross, head of communications for the TTC.
“They’re capped at five per cent of the contract’s value. The contract’s value was $993 million, so five per cent of $1 billion, essentially, is $50 million.”
The lawsuit stems from Bombardier’s inability to deliver to the TTC streetcars on the timeframe they promised.
In 2009, the TTC entered a deal with Bombardier to manufacture 204 Flexity Outlook streetcars to replace the TTC’s aging fleet of CLRV and ALRV streetcars.
Under terms of the contract, Bombardier was supposed to have delivered 67 of the 204 streetcars by now.
However, only 10 of the new streetcars are currently in active service.
“There are impacts on our customers, and on our customer service, and on accessibility, and the need for us to maintain the old cars and keep them in service while we wait for new cars, instead of retiring them as we should be,” Ross said.
Ross maintains the TTC had been working with Bombardier for over a year to correct the production timeline, and suing them was a last resort.
“We don’t want money, we want streetcars. Clearly, this is what it’s going to take, and maybe it won’t be enough, but we have to take some action to demonstrate the seriousness with which we take this matter. We can only do so much behind the scenes. We need to let the public know that we’re serious about this,” Ross said.