Los Angeles asks Talgo to return the fleet after breaking its contract in May

The legal battle between Talgo and the metropolitan authority of The Angels (LACMTA) It has already begun. The US entity was the first to open fire against the Superior Court of the State of California, where it has requested precautionary measures against the Spanish train manufacturer, whom it accuses of retaining part of the fleet for the city’s metro after informing it that it was terminating its supply agreement in advance due to repeated breaches. Talgo defends his position in that LACMTA still owes him almost 60 million dollars in unpaid bills to date.

The crossing of accusations is reflected in the brief delivered to the US justice last september 14, which details the relationship between the Administration and the contractor, especially since the first delays in the delivery of the trains were recorded. The documentation consulted by Information It mainly includes the position of Los Angeles, which defends, above all, that the termination of the contract was made in accordance with the law and the clauses that contemplated it (GC-27), contrary to what Talgo maintains, which alleges that the breakup was “for convenience”.

Throughout the statement of reasons, a list of events subsequent to the month of May, the date on which both parties publicly communicated the end of their relationship. The contacts continued during the summer months and reached their peak on July 27, where a face-to-face meeting took place in the United States at the highest level. The appointment was part of an orderly transition plan, which is also included in the terms and conditions of the agreement (GC-28) signed by LACMTA and Talgo Inc.a US subsidiary of Talgo.

Right now, Talgo would retain in its repair facilities in the city of Milwaukee, Wisconsinten of the city’s Metro vehicles (the A650, originally manufactured by the Italian company Breda), as well as associated equipment at review facilities. The Spanish company, according to the LACMTA brief, has demanded that Metro I paid him about 60 million dollars to return these assets, something that goes against the signed conditions.

Asked by this newspaper, a Talgo spokesperson recognizes that the company was notified on September 16 of the lawsuit filed by LACTMA and adds that “strongly disagrees with the allegations contained” in the same. “Talgo intends to vigorously defend the lawsuit and file their own claims they add, but not before concluding that “he has fulfilled and will continue to fulfill the terms of the contract he signed.”

Los Angeles was the third place in the United States that Talgo explored. Before it was the turn of the trains of the Serie 6 to meet the needs of the federal operator Amtrak. They were trains prepared to reach 200 kilometers per hour and travel 750 kilometers each day between Vancouver (Canada) and Seattle (Portland, United States). The success of this agreement led the company to close another order with Amtrak years later for cars from the Serie 8to increase the supply of the American.

A worrying breakup

The agreement between Talgo and Los Angeles dates back to 2016, although only a year later the authority of the metropolitan area extended the contract to 90 million dollars, at the rate of the remodeling of 74 trains for the Metro of the city – at first they were only half – during the following 58 months. The sensations were very different, in view of the declarations: “We will be able to demonstrate to LACMTA that our knowledge and experience in the sector make Talgo the perfect choice to improve the performance of the trains serving the city’s rail network,” said Anthony PerezCEO and president of Talgo USA.

Five years later, the market takes the news of the breakup pessimistically, with abrupt falls in the company’s share price the day the divorce became known. The houses of analysts spoke. Renta 4 he stated that the end of the conflict “could be very relevant” for Talgo “in the event that the guarantees are executed”. In the same sense, they estimated that “currently the difference between what was collected and the degree of execution of the contract and inventory position could be around 15 million euros negative for Talgo“.

The one in Los Angeles is not the only major Talgo contract that has been stuck in 2022. Renfe surprised with a statement in the summer, in which it accused the manufacturer of failing to meet the delivery deadlines for the trains Avril, essential for the high-speed project between Madrid and Galicia. The conflict, whose resolution is pendingcame to take on a political tone, with the entry of the Minister of Transport, Raquel Sánchez. Renfe claims a compensation of 116 million.

Source: LA INFORMACIÓN – Lo último by www.lainformacion.com.

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