London Tram SVT 960K Bogie Overhaul Materials

STADLER

Justification for Direct Award to Stadler Under Schedule 5 of the UK Government Procurement Act 2023

The justification for awarding STADLER the contract as a single supplier is under Chapter 3, Section 41, and Schedule 5 Direct Award Justifications (Schedule 5) of the UK Government Procurement Act 2023 (the Act).

Stadler, as the Original Equipment Manufacturer (OEM), uniquely possesses the intellectual property, technical capabilities, and proprietary rights essential for fulfilling the requirements for the critical parts.

1. Technical Feasibility - Paragraph 6

The execution of the required works necessitates the use of materials, sub-components, and commodities that are exclusively manufactured and supplied by Stadler. These critical inputs are not available for purchase on the open market and are not distributed to third parties. As a result, it is technically infeasible for any supplier other than Stadler to deliver the scope of works required under the contract.

Engaging an alternative supplier would risk incompatibility between the existing systems and any new goods, services, or works introduced. Such incompatibilities could require substantial redesign, reengineering, or modification efforts, which are not only complex and time-consuming but also likely to result in unacceptable costs and delays. Given the essential nature of the services being supported, such delays would be detrimental to the continuity of critical operations.

2. Additional or Repeat Goods, Services, or Works - Paragraph 7

This contract forms part of a series of linked procurements, providing for the partial replacement or supplementation of goods, services, or works already delivered under a prior agreement with Stadler. Procuring from a different supplier at this stage would create disproportionate technical difficulties in both the operation and ongoing maintenance of the integrated systems.

Specifically, third-party suppliers would lack access to proprietary specifications or components necessary for interoperability with the existing Stadler-supplied infrastructure. In scenarios such as overhauls or component failure, a non-OEM supplier would ultimately have to source parts from Stadler, reintroducing Stadler into the supply chain indirectly, thereby increasing risk, complexity, and cost. This approach would also result in extended lead times and reduced operational reliability-outcomes that are inconsistent with the authority's service obligations and value-for-money principles.

Accordingly, the direct award to Stadler is justified under both Paragraphs 6 and 7 of Schedule 5 to the UK Government Procurement Act 2023. Stadler's unique position as the OEM, combined with the technical and operational risks associated with using any other supplier, supports the conclusion that competition is absent for technical reasons and for reasons of compatibility, making a direct award both necessary and legally compliant.