Cut throat competition in road tenders

Construction companies are outbidding one another in road construction tenders resulting in prices far below the cost estimates of the Road and Highway Administration (GDDKiA). For example, Strabag won the tender to build the Kolo-Konin stretch of the A2 highway by offering EUR 83 million, whereas GDDKiA estimated the cost at EUR 140 million. However, even though GDDKiA requires contractors to have relevant experience and recommendations, the low bids sometimes result in unsatisfactory quality or delays in construction works. Iberian companies have been very active in road construction tenders recently, but their substantial experience comes mainly from EU-financed contracts carried out in the 1980s in Spain and Portugal. They are now learning that the Polish environment is somewhat different and they are having problems with Polish subcontractors. (Parkiet, p. 6) T.J.