Public transport authority Storstockholms Lokaltrafik (SL) has cancelled its contract with Ansaldo STS to install a new CBTC signalling system on Stockholm’s red line.
SL said it believed Ansaldo had breached the terms of the contract and that it had lost confidence in the company’s ability to deliver the new signalling system.
The contract was signed in 2010 and the new system was due to be in place by 2014.
The original contract had been valued at €80 million and covered the resignalling of the 41 km red line network and 36 stations.
SL has asked Ansaldo STS to repay advanced payments totalling around SEK 231 million (€24 million) plus VAT of around SEK 57 million (€6 million) and interest, as well as penalties and damages of SEK 163 million (€17 million).
Ansaldo STS said SL’s decision to terminate the contract was “without grounds” and that it would explore what legal avenues were open to it.
In a statement, Ansaldo STS chief executive Andy Barr said: “We are extremely disappointed and surprised by the SL action which is not in the best interest of local commuters and, most of all, of Stockholm’s taxpayers.
“I continue to believe that completing the contract is the best option for the city. Significant amounts of the new signalling equipment is now fitted and available for trialling the new system and so at this point of the project for SL to decide to not continue is of concern.
“We have been working very hard to try to find a common ground to talk and therefore an agreement with SL management during the last months whilst at the
same time continue to deliver this project.
“SL management decision to take this action against us and terminate the contract, so now we have no choice, but use strong legal measures.”