It’s back to the drawing board for BYD, which has mutually agreed with the Long Beach Transportation Company (LBT) to terminate its contract for the delivery of 10 electric buses. In a puzzling twist, Long Beach may still end up buying the BYD buses, but the current deal is dead, and BYD will have to submit a new bid along with any interested competitors.
The plan to buy buses from Chinese-owned BYD has been controversial from the beginning. But it wasn’t the protestations of competitor Proterra, or doubts about the buses’ performance in safety testing, that scuttled the deal. Rather, the Federal Transit Administration (FTA) withdrew a $12.1-million federal grant that was meant to finance the purchase, because the company could not certify compliance with the government’s Disadvantaged Business Enterprise Program, an oversight that BYD calls “a good faith error.”
Ms Stella Li, CEO of BYD, said, “It is surprising that the FTA waited nine months to withdraw funding from this contract – after BYD spent millions of dollars – due to what can only fairly be described as a technical error that in no way casts doubt on our deep commitment to purchase from disadvantaged businesses.”
Both the FTA and the LBT’s attorneys agree that BYD is now eligible to participate in any future contract. “In an effort to demonstrate our good will to both the people of Long Beach and the FTA, we have agreed to mutually terminate the Long Beach Transit contract so it can be re-bid without delay,” said Ms Li.
“We are confident that we will prevail in any competitive re-bid for the same reason we prevailed last year: Our superior technology,” said Ms Li. “We have the longest range of any electric bus, with up to 24-hour service on a single electric charge. We have no engine, no clutches and no transmission – simply in-wheel-hub motor drives and batteries. We look forward to creating many new jobs at our two new manufacturing facilities in Lancaster, California and administrative offices in Los Angeles. We already have created 60 new jobs in both places. We expect to increase to 200 [new jobs] by the end of next year. We are here in Southern California and in America for the long-term.”