GO E C G D
RR DO T
GRS 850
UNCLASSIFIED
R+R
to me
1. Searle
Mr Szepe
15
17
FICE OPY, KLIM
aray
HKK 172 NO DISTRIBUTION
INDEX
23 SEP 1980
COMMERCIAL IN CONFIDENCEN (23/9
FM BTC HONG KONG 1869577 SEPTEMBER 80
TC IMMEDIATE E C G D
FACEL
нко HKED⋅
TELEGRAM NUMBER EXCED 24 CF 18 SEPTEMBER
X2
see RZA
INFO ROUTINE DOT (FOR CRE4)
FOR BIRCH
YOUR EXCED €1912 (NOT REPEATED)
ADVANCED ECG)
BUSES FOR KOWLOON MOTOR BUS COMPANY (KMB)
MORRISON MET YESTERDAY WITH LAWRENCE AND CHARLES LOUEY
OF KMB TO CONVEY GIST OF YOUR T U R. THEY EXPRESSED DISAPPOINTMENT
THAT KMB HAD NOT BEEN GIVEN EARLIER WARNING OF YOUR NEW SECURITY REQUIREMENTS AND IN LIGHT OF THE FOLLOWING FUT FORWARD A COUNTER-PROPOSAL (SEE PARAGRAPH 6) WHICH THEY HOPED YOU COULD ACCEPT TO ENABLE LOAN AGREEMENT TO BE SIGNED
30 SEPTEMBER.
BY
2. KMB QUESTIONED YOUR FIGURES ON THE EXTENT OF THEIR FULL PROGRAMME LIABILITY. IN ADDITION TO THE 406 BUSES FOR 1981 (POUNDS STERLING 22 MILLION) THEY SAID THEY WERE PLANNING TO ORDER 408 FOR EACH OF 1982 AND 1983 ONLY. THEREAFTER THEY EXPECTED THE EXPANSION PROGRAMME UNDERTAKEN AT THE REQUEST OF THE HONG KONG GOVERNMENT TO SLOW DOWN CONSIDERABLY AS A RESULT OF THE EFFECTS ON KMB'S OPERATIONS OF
1) COMPLETION OF THE TSUEN WAN EXTENSION TO THE MTR (11) COMPLETION OF THE ELECTRIFICATION OF THE KOWLOON-CANTON
RAILWAY
(111) INTRODUCTION OF A LIGHT RAIL SYSTEM IN TUEN MUN OR A BUS FRANCHISE WHICH MAY NOT GO TO KMB.
CONSEQUENTLY KMB ENVISAGED A MAXIMUM LIABILITY IN THE
REGION OF POUNDS STERLING 80-100 MILLION DEPENDING
CN COST ESCALATION, NOT YOUR PROJECTED FOUNDS STERLING
150 MILLION.