Japanese, U.S. Firms Team Up for Low Bid on Subway Tunnel

For years now, civic leaders downtown have told each other the Metro Rail subway is essential for Los Angeles to become a “world city” and center of Asian commerce.

Accordingly, a Metro Rail milestone was passed Friday with a major Japanese firm, Ohbayashi Corp., emerging as a leading candidate to dig the first subway tunnel through downtown next year.

Sealed bids for the huge job were read publicly shortly after 2 p.m. Friday, accompanied by gasps and curses from an audience of competing contractors. A joint bid by M. L. Shank Co. of Denver and Ohbayashi, a worldwide concern based in Tokyo, was the lowest received.

Their price for the tunnel--$26.3 million--was $2 million better than the closest competitor, and far below the $38.5-million cost that was estimated by the Southern California Rapid Transit District, which will build the subway.

“Quite frankly, I am surprised to see one (bid) this low,” said James Crawley, director of engineering transit facilities for Metro Rail. “Needless to say, we are pleased.”

Before the contract is awarded to Shank and Ohbayashi, RTD officials must be convinced that the firms can actually handle the job. The first Metro Rail tunnel will be excavated from 5th and Hill downtown to below Flower and 7th, and take more than two years to complete.

Shank and Ohbayashi appear to meet all qualifications, including a requirement to use American products and hire a guaranteed percentage of minority and female subcontractors. The appointed RTD board has scheduled a vote on the bid next month.