Kawasaki's Lincoln rail car plant is poised to receive the largest subway car order in its history, the economic effects of which "could be felt for years to come," a local company official said.
The Metropolitan Transportation Authority voted Monday to recommend the Japanese company potentially provide more than 1,600 cars for the organization, which governs public transit in the New York City metro area. A final vote will come on Wednesday.
The contract consists of a $1.4 billion base order for 535 R211 subway cars, with options for 1,077 additional cars, which would bring the total cost to more than $3.6 billion.
The MTA on Friday announced the scope of the contract had grown from $3.2 billion to $3.6 billion.
One of the key elements of the contract is that Kawasaki would manufacture at least 20 "open gangway" cars, that allow passengers to walk between them. The cars also would have features aimed at safety and modernization, including wider doors, eight digital screens inside each car and on-board computers to track the cars' conditions and performance.
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Kawasaki was the only company being considered for the contract. Reuters reported in September that MTA dropped from consideration a joint bid from Bombardier and a Chinese company because of Bombardier's problems completing another subway contract for the authority.
The cars would mostly be manufactured in Lincoln, although some manufacturing may take place at Kawasaki's Yonkers, New York, plant. The first deliveries would be expected sometime in 2020.
Jason Hellbusch, director of human resources and quality assurance at the Lincoln plant, said Kawasaki has been in negotiations with MTA for some time and is "thrilled to see it nearing finalization."
"The timing of the start of manufacturing is also ideal for Kawasaki in Lincoln as we will be nearing the completion of other current contracts," he said in an email.
"A contract of this magnitude is obviously an extremely positive circumstance for Kawasaki, its work force and the surrounding communities," Hellbusch said. "The economic impact on the state of Nebraska could be felt for years to come."
That impact will not necessarily mean more jobs, though. Kawasaki employs around 2,000 people in Lincoln, several hundred of which work in the rail car operation.
Hellbusch said that because the start of this contract coincides with the ending of other contracts, it's likely the current workforce could handle the work.
"However, due to the size of the contract it is possible we would need to add team members at some point," he said. "This is yet to be determined as we finalize the details and timing of the project."
Reach the writer at 402-473-2647 or molberding@journalstar.com.
On Twitter @LincolnBizBuzz.
Matt Olberding
Business reporter
Matt Olberding is a Lincoln native and University of Nebraska-Lincoln graduate who has been covering business for the Journal Star since 2005.
