Montreal has ordered 765 new Metro cars with an option to buy 288 more. (CBC)

The future of the $3-billion contract to build new cars for Montreal’s Metro system is once again up in the air as the city and the province have announced they have put a stop to negotiations with the consortium formed by Alstom and Bombardier Transportation.

The move comes as the Montreal Transit Corporation (MTC) is increasing its order from 342 cars to a total of 765 cars with an option to order 288 more.

The MTC had been in negotiations with the Alstom-Bombardier constortium for eight months.

But the decision to significantly modify the terms of the original call for tenders obliges the corporation to issue a notice of intent giving other companies 30 days to signal their interest, said MTC spokesperson Odile Paradis Friday.

Should any other companies express interest, the tendering process will have to be re-launched, Paradis said.

The Alstom-Bombardier was the only bid submitted after the MTC launched the tendering process in 2008.

But, in December, a third company, China’s CSR Zhuzhou Electric Locomotive Co. Ltd., threatened legal action, claiming the Montreal Transit Corporation (MTC) did not adequately communicate the original call for tender in 2008.

On Friday, Quebec Finance Minister Raymond Bachand said he sees the notice of intent as nothing more than a formality.

"We have an agreement with Bombardier-Alstom, that is good news," Bachand said.

Better quality, more affordable cars

But the transit corporation and the government must take the process seriously, warned Zhuzhou spokesman Glen Fisher.

"There is a judgment that says that it has to go to open tender and they have violated that judgment," Fisher said.

Zhuzhou can make better quality Metro cars at a cheaper price than Alstom and Bombardier, he said.

Zhuzhou is proposing the use of steel wheels, which are more efficient than the rubber tires currently used by the Metro, Fisher said.

In the past, the MTC has rejected that proposal.

The cars must contain at least 60 per cent Canadian content and must be assembled in Canada.

The contract for the new metro cars has been controversial since the province first awarded the contract to Quebec-based Bombardier in 2006, without opening the bidding process.

That decision was contested by French-based Alstom, which eventually partnered with Bombardier to make a bid.