ADMINISTRATIVE REPORT

Date: October 3, 2002
Author/Local: Jim Lloyd (7254)

RTS No. 03018

CC File No. 1805

Council: October 22, 2002

TO:	Vancouver City Council
FROM:	General Manager of Engineering Services and Manager of Materials Management
SUBJECT:	Contract Extensions: Contract No. PS99046 Light Duty Vehicles -Brand Standardization and Contract No. PS00035 Supply & Delivery of Ford Light Duty Vehicles

RECOMMENDATION

THAT Council extend Contract No. PS99046 with Ford Motor Company of Canada Limited to June 30, 2005 for the brand standardization of light duty vehicles, and to extend Contract No. PS00035 with Coastal Ford Sales Limited for a 24-month period for the supply and delivery of Ford light duty vehicles and related services.

POLICY

The policy of Council is to award contracts for the purchase of equipment, supplies and services that will give the highest value based on quality, service and price.

Contracts with a value over $300,000.00 are referred to Council.

BACKGROUND

This report deals with the extension to two contracts which involved the standardization of light duty cars and trucks for the City fleet. The benefits to standardize the fleet for a multi-year period include more efficient repairs, reduce parts inventories, reduce procurement cycle time, and eliminate administrative expenses for warranty claims.

Prior to these contracts being put in place, the City would invite vehicle dealers of different vehicle manufacturers to submit tenders as and when required for the supply and delivery of various types of light duty vehicles. This resulted in a number of product lines being introduced into the City fleet which creates inefficiencies.

The standardization process was divided into two parts. The first part being the selection of the vehicle manufacturer to reach an agreement on a vehicle pricing structure, parts supply, and warranty repair and claim processes. The second part of the process is the selection of a dealer to administer the contract on behalf of the manufacturer.

Council awarded the first contract to Ford Motor Company of Canada Limited on March 7, 2000 for a three year period for the provision of light duty cars and trucks as the vehicle manufacturer.

Council awarded a second contract to Coastal Ford Sales Limited on July 11, 2000 for a three year period for the dealer portion.

DISCUSSION

Each contract provides for two additional 12-month extension periods. Both Ford and Coastal Ford have performed well during the above contracts and it is recommended that both extension periods be exercised together which will include up to the 2005 model year with a variation to the extension period for the Ford contract.

We recommend that the 24 month extension period for the Ford contract should be extended by approximately 3 months to June 30, 2005 subject to Ford's manufacturing end date of a particular model. This date aligns more realistically with Ford's production and model year plus the Coastal Ford portion of the contract. Ford has concurred with this change.

All other terms and conditions remain the same.

FINANCIAL IMPLICATION

Funds for purchases from these contracts are largely provided from the Truck Plant Account and from time to time other approved accounts. Generally, an estimated 80-100 vehicle purchases per year are based on these contracts.

CONCLUSION

Accordingly, we recommend the extension of the Contract No. PS99046 to Ford Motor Company of Canada Limited for the provision of light duty cars and trucks until June 30, 2005, and to extend Contract No. PS00035 to Coastal Ford Sales Limited. for an additional 24-month period.

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(c) 1998 City of Vancouver