M. Mc Qmaske "Me
Pr. openh
HOFO @25/17
00 D.O T
DESKBY 1712002
GPS 450
NO
CONFIDENTIAL
DESKBY 171200Z
My Searle
4123/2
RECEIVED IN REGISTRY NO. 51
17 AUG 1981
DESK OFFICER INDEX
DISTIED
RE
Action Zaken
THIS TELEGRAM WAS NOT ADVANCED
FM D T C HONG KONG 1709422 AUG 81
TO IMMEDIATE DOT
TELEGRAM NUMBER CREDA 199 OF 17 AUGUST
FOR BENJAMIN PEP DIVISION.
PTO
17/8
[DOT]
HAGT TRED
ん
See O
173/2 WP.
MY CREDA 197. KOWLOON-CANTON RAILWAY. HOWES SHOWED ME IN STRICT CONFIDENCE A COPY OF THE ORIGINAL KCR SUBMISSION TO THE HONG KONG GOVERNMENT IN 1978 WHICH SUGGESTED THAT ALTHOUGH 60 X 3 CAR SETS WERE REQUIRED FOR THE OPERATION OF
A FULLY ELECTRIFIED LINE, THE INITIAL ORDER COULD BE REDUCED TO 45 SETS. IN OTHER WORDS, HONG KONG GOVERNMENT REGARDS THE (16)ADDITIONAL SETS AS THE COMPLETION OF THE ORIGINAL REQUIREMENT. BECAUSE NEITHER THE HONG KONG GOVERNMENT NOR THE KCR RESORTED TO CREDIT FINANCING IN 1978 THEY WERE UNFORTUNATELY NEVER ALIVE TO THE TECHNIQUE OF INCLUDING THE BALANCE OF REQUIREMENTS AS AN OPTION.
2. HOWES ASSUMES THE INITIAL ORDER OF 45 SETS TO BE COMPLETED BY JUNE 1983. THE ADDITIONAL 16 SETS (12 FOR OUTER SUBURBAN AND FOUR FOR INNER SUBURBAN SERVICES) WILL BE NEEDED IN THREE STAGES, SIX IN EACH OF 1986 AND 1987 AND THE REMAINING FOUR IN 1988. THE EXPECTED COST OF THE 16 SETS IS ABOUT PDS STG 16.3 MILLION FOB. THERE ARE PROSPECTS OF A FURTHER ORDER FOR 12 SETS AT THE END OF THE DECADE.
3. HOWES CAN ACCEPT SOME INCREASE IN THE FOB TENDER PRICE QUOTED IN DECEMBER 1978 BUT WAS CLEARLY HOPING THAT INFLATION COSTS WOULD HAVE BEEN SUBJECT TO STANDARD TTC COVER, HE NEEDS TO PLACE THE ORDER BY MID 1964 BUT IS WILLING TO ADVANCE THE PURCHASE DATE TO KATH MET-CAM'S PRODUCTION GAP. THE KCR HAVE NOT HITHERTO CONSIDERED RECOURSE TO CREDIT BUT SINCE THE REQUIREMENT EXTENDS UNTIL 1985 MIGHT BE PREPARED TO CONSIDER AN OFFER IF IT WAS IN THEIR
NTEDEST
HAVE BEEN LAMITLA TA ALT
10
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