Kevin Lee, spokesman for Long Beach Transit, said BYD got the contract because the company’s bus offers lower maintenance costs. He also credited the company’s experience. BYD’s Chinese parent has delivered more than 700 electric buses to customers worldwide.
The Long Beach Transit Board voted March 25 to award the 10-bus contract to the company, using a $6.7 million federal grant for all-electric buses. Long Beach will kick in the rest to bring the contract’s total cost to nearly $14 million.
The buses will be evaluated at the Federal Transit Administration’s Bus Research and Testing Center in Altoona, Pa., to make sure they meet U.S. safety standards. The company will have to verify that 60 percent of the components are made in America.
The contract includes a $14 million performance bond. If BYD fails to meet its obligations, it could face reduced payments.
The company’s move to building buses comes after it failed to meet initial hopes for its L.A.-based passenger vehicle after opening its 30,000-square-foot headquarters and showroom at 1800 S. Figueroa St. in October 2011.
An April 2010 press release from the city of Los Angeles said the company would create at least 150 jobs through 2011, but those estimates were revised as the demand for electric vehicles failed to live up to expectations. In July 2010, the Community Development Department projected BYD would create 102 jobs by 2013.
All those predictions have so far come up short. The headquarters now employs 39 people, many of them are transfers from other locations, including China. Austin, whose office is in Arlington Heights, Ill., would not say how many of the employees at the downtown L.A. headquarters were local hires.
Los Angeles attracted BYD to downtown with an incentive package totaling about $5.2 million over five years.
Austin Beutner, the former deputy mayor who led the effort to bring the company to Los Angeles, still believes the incentives were worth it because the company will create manufacturing jobs and help cities reduce emissions from their transit systems.
“It’s the sort of business you want to attract and you hope that will be successful,” he said.
BYD beat out several U.S. bus makers for the Long Beach contract, including Greenville, S.C., startup Proterra Inc., which has 160 employees and has delivered 10 electric buses to cities such as Pomona and Tallahassee, Fla.
Proterra issued a scathing letter to Long Beach Transit after the agency first recommended BYD. Marc Gottschalk, general counsel for Proterra, hammered Long Beach for granting the award to a company with “a history of overpromising and underdelivering.”
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