Helsinki Delays New Tram Funding Amid ‘Exceptionally Strong’ Procurement Allegations

Helsinki has delayed a decision on extra funding for Stadler’s trams after politicians were presented with what officials described as exceptionally strong allegations about the procurement process.

The city originally agreed to pay 271 million euros for 63 Swiss-made trams. Stadler is now seeking an additional 65 million euros, bringing the requested price to 336 million. The contract already includes an index-linked adjustment, so the increase is not attributed simply to inflation.

Stadler has said costs rose partly because Russia’s war increased expenses. The company has also pointed to limited supply across the tram industry. Politicians questioned why the manufacturer wanted more money and decided to leave the matter open for another two weeks.

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Exceptionally strong allegations

The allegations came mainly from Škoda, the other company that submitted a bid. Kaupunkiliikenne Oy rejected Škoda’s offer because of technical shortcomings, leaving Stadler as the sole bidder and eventual winner. Škoda argues that its bid was rejected unfairly. The company has appealed to Finland’s Market Court and the Finnish Competition and Consumer Authority, and has sought permission to appeal to the Supreme Administrative Court. None of those efforts has favored Škoda so far.

According to information reported by Helsingin Sanomat, Škoda’s offer for the first trams was 264 million euros. The procurement also includes an option for 120 more trams, as well as maintenance and spare parts for 30 years. If the full package proceeds, its value would be about 1.6 billion euros, subject to further price increases. Because the purchase is public, municipalities must approve any budget overrun. Much of the tender material remains secret under commercial-confidentiality rules, prompting some politicians to call for greater public disclosure.

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Unusually aggressive