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Publish Date : 10-Apr-2015

Senior vice-president with rail and turnout expert Voestalpine, Dr Martin Platzer, has urged European railways to launch the procurement of systems and equipment on the basis of the most economically-advantageous tender (Meat) instead of just the lowest price. He said this at the Railway Forum which was held in Berlin in March and attended by David Briginshaw.

One would think that significant thought is given to life-cycle costs, product quality and longevity, and the technical ability and know-how of the vendor, as railways are capital intensive, and structures and equipment often last for years. Short-term economic pressures all too often lead railways to choose equipment based on the lowest price, while there is a trend in this direction.

Public procurement represents around 20% of the European Union (EU)'s Gross Domestic Product (GDP). Although the new directive is yet to become national law, the EU completed its public procurement framework in 2014.

Under the directive, contracts will have to be offered on the basis of Meat decided on the basis of the cost or price using a cost-efficient approach like life-cycle costing. Speaking to delegates, Dr. Platzer, said, "There is no option anymore, we must do it. Lots of organisations are already following these new principles, so we are not trying to perform a miracle in the railway industry."

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