WP YX YIXB
HOFO 038/16
00 DOT DESKBY 161400Z
GR 450
CONFIDENTIAL
DESKBY 161400Z
FM BTC HONG KONG 161115Z JAN 79
TO IMMEDIATE DOT
PA
TELEGRAM NUMBER CREDA 18 OF 16 JANUARY.
NO DISTRIBUTION
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YOUR CREDA 10 AND DO INDUS 19: MASS TRANSIT RAILWAY CORP (MTRC).
1. I HAVE NOW HAD TIME TO CONSULT WEEDON (GEC) DRIVER (DRAKE AND SCULL), AND SANSOME (METCAM) ABOUT THE EFFECT OF THE JAPANESE INTEREST WAIVER OFFER ON THE WHOLE RANGE OF THE E AND M CONTRACTS. IT IS CLEAR THAT THE OFFER HAS BEEN MADE BY HMT (A CONSORTIUM OF
HITACHI, MITSUBISHI AND TOSHIBA) WHO ARE BIDDING FOR CONTRACTS 351,
THE WAIVER OFFER COVERS ALL OF 54, 357, 369, 361, 363 AND 364. THEM BUT THE KEY CONTRACTS ARE PROBABLY 351 (TRAINS), 357 (POWER) AND 363 (VENTILATION). I APOLOGISE FOR HAVING GIVEN PROMINENCE TO 353 (TELEPHONES) AND 360 (ESCALATORS) IN MY CREDA 15 BUT THESE WERE THE CONTRACTS THAT HAD BEEN MENTIONED IN INFORMAL CONVERSATIONS WITH MY CONTACT IN THE MTRC. MIFT LISTS ALL THE MAJOR E AND M CONTRACTS, THEIR APPROXIMATE VALUE AND THE SHORTLISTED BIDDERS.
THE
2. SANSOME CONFIRMS THAT HE HAS NO OBJECTION TO THE DEPARTMENT OF INDUSTRY DISCUSSING THE PRICE PROBLEM WITH GEC TRACTION, HIS PARTI IN 351 (TRAINS)
(TRAINS). UNLIKE THE JAPANESE, WE DO NOT HAVE A COMMON MANUFACTURER WHO CAN OFFER INTEREST WAIVER ACROSS THE BOARD. CONTRACTS IN WHICH WE ARE INVOLVED ARE: CONTRACT 351 (TRAINS) METCAM, CONTRACT 357 (POWER) GEC, CONTRACT 359 (OVERHEAD COLLECTION SYSTEM) BALFOUR BEATTY, CONTRACT 363 (VENTILATION) DRAKE AND SCULL, CONTRACT 364 (AUXILIARY SERVICES) GEC HONG KONG
AND DRAKE AND SCULL. WEEDON SUGGESTS THAT THOMPSON'S PLAN MAY BE TO TRY TO BALANCE JAPANESE AND BRITISH COMPETITION BY SEEKING TO AWARD 351, 357 AND 364 TO US AND 353, 354, 353, 356, 360, 361 AND 363 TO THE JAPANESE. 359 IS A STRAIGHT FIGHT BETWEEN BALFOUR BEATY
AND SIEMENS.
I THINK WE SHOULD CONCENTRATE OUR EFFORTS ON WINNING CONTRACT 3 RAINS) BY ALLOCATING ANY FUNDS AVAILABLE TO METCAM'S BID AND