The MBTA is going to order hundreds of new cars for the Red and Orange subway lines, both of which are in desperate need. Some of the current subway cars have been operating since the year Neil Armstrong walked on the Moon, and by quick estimate, may have traveled over ten times as far!
Let's see how the cost of new equipment compares. There isn't really a market for "new subway cars" like there is for "new automobiles" but we can look at some similar agencies to get a general idea:
- BART has ordered 410 cars at a cost of $ (2012): $2.2m/car
- CTA ordered 706 cars at a cost of $1.137 billion (2012): $1.61m/car
- WMATA ordered 428 cars at a cost of $886 million (2010): $2.07m/car
- TTC ordered 234 cars at a cost of CA $710 million, approx. US $650 million (2006) of which the article claims that CA $211m is "extras", perhaps, so this may be as low as US $460 million for the cars, actually: US $1.97m/car
- Going back a bit, NYCT ordered 660 cars at a cost of $961 million (2002): $1.46m/car
- MBTA's most recent heavy rail order was 94 Blue Line cars at a cost of $174 million (2006) but the old CIP claims $234 million through FY10. Not clear if some of that cost included non-vehicle expenses: either $1.85m/car or $2.49m/car
- And, looking forward, MBTA will order 226 cars for a cost of $1.3 billion (2013): $5.75m/car
Okay, let's break that down further, because the MBTA Capital Investment Program seems to indicate that the $1.3 billion actually includes the cost for things other than subway cars. It says:
- $539 million for 152 new Orange Line cars: $3.55m/car
- $262 million for 74 new Red Line cars: $3.54m/car
That's considerably better, but still quite high. Here's a list:
$2.2m, $1.61m, $2.07m, $1.97m, $1.46m, $1.85m, $2.49m, $3.55m, $3.54mTwo of these numbers are not like the others. Why is the Red and Orange Line procurement planned to cost so much more than any other subway car procurement in North America, that I have found so far? This seems like a scandal, a huge waste of money, and yet another weight dragging down the MBTA. The Commonwealth seems to be determined to throw away hundreds of millions of dollars. That additional 30-50% cost per car could have been put towards much desperately needed maintenance. Or additional vehicles to increase service on the overloaded Orange Line. Or on any of many worthy transit projects waiting for funding.
My hypothesis is that this 30-50% escalation in costs is a burden caused, at least in part, by the "Buy Massachusetts" requirement. Such nationalistic requirements are infamous for causing cost escalation. "Buy America" is a scam. The reason is simple: we don't have an established supply chain or industry with experience at producing subway cars. Even if it's just final assembly, we still need to bear the cost of creating the facilities from scratch, and training the workers; who will inevitably make mistakes. Stupid ideas like "Buy America" and "Buy Massachusetts" come from folks who don't understand the nature of economies and industrial policy. They try their hands at Central Planning and try to force an industry to grow when and where it isn't natural. Taxpayers pay the price, transit riders bear the burden of worse equipment (hello, Boeing), and transit systems are stifled by lack of resources. Ultimately we end up hurting the industry with this policy that was supposedly intended to help it. That's the "Buy American" way.