Metrolinx is in talks with another company to supply vehicles for the Eglinton Crosstown LRT project, and the transit agency fears it could be forced to pay the consortium building the rail line up to $500,000 a day in late penalties if it’s not able to get out of its troubled contract with Bombardier, according to legal documents.

In affidavits filed by Metrolinx Thursday the transit agency, which is owned by the province, claims Bombardier’s failure to deliver vehicles on time has pushed the situation to an “urgent crisis point.” They warn that Metrolinx could suffer “extreme” financial loses if it’s not permitted to find another supplier. The agency’s $770-million vehicle deal with the Quebec-based rail manufacturer has been tied up in court since February.

Bombardier has denied it is at fault for delays to the order, and in a statement released Thursday afternoon said it was still capable of delivering the light rail vehicles (LRVs) on time.

“We categorically disagree with the allegations made by Metrolinx today. Metrolinx’s reasons for wishing to terminate this contract have nothing to do with our ability to deliver,” the statement said.

“We are focused on building cars for the people of Toronto. We simply want a resolution that puts our employees and the transit riding public first.”

Metrolinx submitted the affidavits in response to an application for an injunction Bombardier filed earlier this month in an attempt to prevent the transit agency from cancelling its contract for 182 LRVs. The documents, which have not been tested in court, paint a scathing picture of Bombardier and allege that the company has irreparably bungled the Crosstown order.

“Bombardier can provide no evidence that it has resolved the many problems plaguing the design, development and delivery of the Metrolinx LRVs to date,” Mark Ciavarro, a Metrolinx project director, swore in one of the affidavits.

The documents claim that Bombardier’s performance has exposed Metrolinx to “massive financial consequences and reputational damage.”

That’s because under the terms of a separate contract, Metrolinx is responsible for paying damages to the construction consortium building the $5.3-billion Eglinton Crosstown in the event that the late delivery of vehicles prevents the line from entering service on time. The line is scheduled to open in 2021.

Ciavarro’s affidavit estimates that damages for late delivery could cost Metrolinx up to $500,000 each day the vehicles are delayed. The contract with the consortium, called Crosslinx Transit Solutions, was negotiated by Metrolinx in partnership with Infrastructure Ontario.

A spokesperson for Metrolinx said that under the deal Crosslinx also faces “significant internal costs if they are late.”

The affidavit argues that Bombardier is attempting “to force Metrolinx into many months of litigation” to prevent the agency from finding another vehicle manufacturer in time for the Crosstown opening.

If the contract isn’t terminated quickly, Metrolinx “will have no choice but to continue dealing with Bombardier and incur extreme losses, because the alternative will be even more catastrophic” the affidavit said.

The documents do not name the other potential supplier Metrolinx is negotiating with. A spokesperson for the agency declined to comment.

Last fall Alstom, a French manufacturer that is building LRVs for Ottawa, told the Star it wanted to take part in the bidding process if Metrolinx sought other vendors for Toronto’s LRT lines. At the time a spokesperson for the company said Alstom was capable of meeting required Canadian content standards, and was “considering an assembly facility in the Greater Toronto and Hamilton Area if there is a volume to support such an investment.”

The Alstom spokesperson did not answer the Star’s questions Thursday.

Metrolinx inked the contract with Bombardier in 2010 for light rail vehicles (LRVs) to run on the Eglinton Crosstown, Finch West LRT and other Toronto-area lines.

Under a revised schedule the two parties agreed to in 2014, Bombardier was supposed to deliver the first of two pilot vehicles nearly two years ago. Metrolinx has yet to take delivery of it.

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In October, Metrolinx served Bombardier with a notice of intent to terminate the contract, claiming the company was in default.

In its court filings, Metrolinx claims Bombardier has broken the terms of the contract by failing to provide the pilot vehicles or a realistic schedule for delivering the rest of the fleet and for not supplying skilled workers and equipment to complete the order. The two parties also disagree over whether Bombardier has met the LRV’s technical loading specifications.

Metrolinx has inspected the company’s plants in Thunder Bay, Ont. and Sahagun, Mexico, multiple times, as recently as last year. Metrolinx says there remain “chronic and ongoing quality control problems” due to “inconsistencies” between the two plants and that the project has been “plagued by welding issues as a result of poor training, incorrect procedures, faulty equipment and poor management.”

“Bombardier has been unable to manage the problem of how two employees in two different countries can measure the same part and reach different conclusions,” a Metrolinx statement released Thursday said.

Bombardier has acknowledged previous problems with its manufacturing but says they have been addressed. The company blames the delays on Metrolinx, which it says has slowed the project by changing the specifications of the vehicles “countless times.”

In its own court filings submitted this month, the company argued that the pilot vehicle for the Crosstown was ready for testing last fall but Metrolinx has refused to take delivery of it.

The company charges that Metrolinx is deliberately trying to sabotage the contract because some of the LRT lines that were planned under the original Transit City plan have since been cancelled or deferred and Metrolinx no longer needs all 182 vehicles it ordered.

Bombardier asserts that it still has plenty of time to complete the pilot and deliver a fleet of vehicles in time for the Crosstown’s opening date. The line requires 76 cars and under the contract the first production vehicles are to arrive by fall of next year.

“Bombardier is fully able to deliver these vehicles on time, by November 2018, well before the tracks for the Eglington Crosstown line are even built,” said the company’s statement.

“We owe transit riders nothing less, and we are on track to make good on these commitments.”

Metrolinx had already signalled that it was open to other companies supplying vehicles for the Finch LRT, which is also supposed to be completed by 2021. Last year the agency asked consortia bidding on the project about including vehicle suppliers as part of their submissions.

A hearing on Bombardier’s injunction request is scheduled for March 21.

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