B-166594, JUL. 17, 1969

B-166594: Jul 17, 1969

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SINCE ADMINISTRATIVE REPORT INDICATES REASONABLE BASIS THAT CHANGES WILL CURE DIFFICULTY AWARD WILL NOT BE DISTURBED. TO GENERAL MOTORS OVERSEAS OPERATIONS: REFERENCE IS MADE TO YOUR LETTER OF JUNE 6. GENERAL ELECTRIC COMPANY (GE) AND YOUR FIRM (GM) WERE THE COMPETING BIDDERS FOR THIS PROCUREMENT. WE WERE REQUESTED BY AID TO ADVISE WHETHER EITHER BIDDER COULD BE CONSIDERED RESPONSIVE TO THE SPECIFICATIONS. THE BASIC QUESTION INVOLVED WAS WHETHER THE BIDDER WAS OFFERING A MOTOR OF "ROBUST AND STURDY CONSTRUCTION" WITHIN THE MEANING OF SECTION 18.1. BECAUSE GE WAS OFFERING ITS 761 TRACTION MOTOR AND THE RECORD SHOWED THAT PWR HAD PURCHASED THIS MOTOR IN THE PAST AND HAD EXPERIENCED A PROBLEM OF CRATER COMPOUND MIGRATION WITH THIS MOTOR.

B-166594, JUL. 17, 1969

BID PROTEST DECISION TO GENERAL MOTORS OVERSEAS OPERATIONS DENYING REQUEST THAT FUNDS FOR PROCUREMENT OF LOCOMOTIVES BY PAKISTAN UNDER AID LOAN BE WITHHELD ON BASIS THAT ITEM OF COMPETITING BIDDER DID NOT MEET SPECIFICATIONS. SINCE ADMINISTRATIVE REPORT INDICATES REASONABLE BASIS THAT CHANGES WILL CURE DIFFICULTY AWARD WILL NOT BE DISTURBED.

TO GENERAL MOTORS OVERSEAS OPERATIONS:

REFERENCE IS MADE TO YOUR LETTER OF JUNE 6, 1969, REGARDING THE AWARD OF A CONTRACT FOR 42 LARGE LOCOMOTIVES BY THE PAKISTAN WESTERN RAILWAY (PWR) UNDER AN AGENCY FOR INTERNATIONAL DEVELOPMENT LOAN.

IN BRIEF, GENERAL ELECTRIC COMPANY (GE) AND YOUR FIRM (GM) WERE THE COMPETING BIDDERS FOR THIS PROCUREMENT, AND ON APRIL 1, 1969, WE WERE REQUESTED BY AID TO ADVISE WHETHER EITHER BIDDER COULD BE CONSIDERED RESPONSIVE TO THE SPECIFICATIONS, IN PARTICULAR SECTIONS 18.1 AND 18.4 OF THE MOTOR SPECIFICATIONS. SECTION 18.1 REQUIRED THAT THE TRACTION MOTOR BE OF "ROBUST AND STURDY CONSTRUCTION" AND SECTION 18.4 RELATED TO EXPERIENCE. WE REPLIED TO THE EFFECT THAT, IN OUR OPINION, THE BASIC QUESTION INVOLVED WAS WHETHER THE BIDDER WAS OFFERING A MOTOR OF "ROBUST AND STURDY CONSTRUCTION" WITHIN THE MEANING OF SECTION 18.1. THAT SECTION OF THE SPECIFICATIONS FURTHER PROVIDED THAT "GREAT CARE" BE TAKEN TO PREVENT MIGRATION OF CRATER COMPOUND INTO THE PINION AND BEARINGS. CONSIDERED THIS LANGUAGE SIGNIFICANT, BECAUSE GE WAS OFFERING ITS 761 TRACTION MOTOR AND THE RECORD SHOWED THAT PWR HAD PURCHASED THIS MOTOR IN THE PAST AND HAD EXPERIENCED A PROBLEM OF CRATER COMPOUND MIGRATION WITH THIS MOTOR. (GE WAS THE LOW BIDDER BASED ON THE 761 MOTOR.) IT SEEMED TO US, THEREFORE, THAT THE 761 MOTOR WAS ROBUST AND STURDY ENOUGH EXCEPT FOR THE CRATER COMPOUND MIGRATION PROBLEM. WE CONCLUDED WITH THE ADVICE THAT,"IF IT WAS ADMINISTRATIVELY DETERMINED THAT THE PRESENT VERSION OF THE 761 MOTOR WOULD ELIMINATE THIS PROBLEM, THE MOTOR SHOULD NOT BE CONSIDERED LACKING IN ROBUSTNESS AND STURDINESS ON THAT ACCOUNT.' 166594, DATED MAY 12, 1969.

IT APPEARS THAT ON OR ABOUT MAY 21, 1969, AWARD WAS MADE TO GE.

IT IS YOUR UNDERSTANDING THAT THIS AWARD WAS MADE DESPITE THE DISAPPROVING RECOMMENDATION OF THE AID CONSULTING ENGINEERS, WHO RULED AGAINST THE APPLICATION OF THE GE 761 MOTOR TO THESE LOCOMOTIVES. YOU BELIEVE THAT THE BUYER, PWR, NEVER WAIVERED IN ITS OBJECTION TO GE'S 761 MOTOR AND ONLY AGREED TO THE AWARD BECAUSE IT WAS FACED WITH THE CHOICE IMPOSED BY AID OF ACCEPTING THE 761 MOTOR OR RISKING THE DEOBLIGATION OF THE AID LOAN. YOU REQUEST THAT FUNDS FOR THIS PROCUREMENT BE WITHHELD PENDING CONFIRMATION THAT AID'S ENGINEERING CONSULTANTS HAVE CHANGED THEIR RECOMMENDATION AND NOW APPROVE OF THE GE 761 MOTOR FOR THE 42 LARGE LOCOMOTIVES.

MR. POATS, THE ACTING ADMINISTRATOR OF AID, BY LETTER OF JULY 3, 1969, REPORTS THAT THE AID EXPERTS ADVISED THAT THE GE 761 MOTOR COULD NOT BE PROVED, EITHER AFFIRMATIVELY OR NEGATIVELY, WITH RESPECT TO THE CRATER COMPOUND MIGRATION PROBLEM, WITHOUT ACTUAL OPERATING EXPERIENCE OVER SEVERAL YEARS; BUT THAT "THERE WAS A REASONABLE BASIS TO BELIEVE THAT THE CHANGES PROPOSED BY GE TO THE TRACTION MOTOR COULD CURE THE DIFFICULTY.' WITH REGARD TO PWR, MR. POATS STATES THAT YOUR REQUEST FOR A DELAY IN THE AWARD PENDING A PROJECTED VISIT BY THE PWR CHAIRMAN TO WASHINGTON, D.C., WAS PASSED ON TO THE PWR CHAIRMAN (MR. QUEREISHY). ACCORDING TO MR. POATS, THE PWR CHAIRMAN EXPRESSED THE DESIRE TO PROCEED WITH THE AWARD TO GE, AND STATED HE HAD NO INTENTION OF REOPENING THE MATTER ON HIS TRIP TO WASHINGTON, D.C., WHICH HE SAID WAS FOR ANOTHER PURPOSE. IN THESE CIRCUMSTANCES, THE AWARD WAS MADE TO GE.

WE SEE NO BASIS FOR DISTURBING THE AWARD. IT APPEARS THAT AN ADMINISTRATIVE DETERMINATION AS CONTEMPLATED BY OUR LETTER OF MAY 12, 1969, WAS MADE TO ACCEPT THE GE 761 MOTOR. ACCORDINGLY, WE MUST DENY YOUR REQUEST THAT FUNDS FOR THIS PROCUREMENT BE WITHHELD.

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