Thanks to a too-good-to-refuse offer from manufacturer New Flyer, OC Transpo could be getting a whole new fleet of articulated buses.
Yesterday, the city’s transit committee unanimously approved a hastily presented offer to purchase 226 new articulated buses for $155.7 million.
The proposal came to OC Transpo after New Flyer had a large order from a transit company in Chicago deferred, New Flyer board chairman Brian Tobin, who is also the former premier of Newfoundland, told the committee.
Rather than scale back production and have to lay off employees, New Flyer is looking for other possibilities to maintain its production levels.
“We’ve got to make the decision to run at the proposed rate, or ratchet down. We’d like to run,” said Tobin. “Because we want to run, we’ve come forward with what I think is a win-win proposal for the city of Ottawa and for New Flyer.”
Tobin called the proposal revolutionary for the bus industry. The city is getting a discount of around $16 million on the cost of the new buses, a $5-million discount on 80 buses it had already ordered and New Flyer will pay a trade-in fee to buy back the current articulated bus fleet.
According to a value analysis report by city staff, not going with the offer would cost OC Transpo around $156.9 million.
Since the buses in the current fleet are all between six and nine years old, OC Transpo was preparing to spend around $66 million over the next four years performing mid-life refurbishments on those buses. That cost would be avoided.
Also, since the new buses are far more fuel efficient, OC Transpo expects to save around $6 million per year in fuel costs. The five-year bumper-to-bumper warranty would also represent significant savings.