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L.A. COUNTY CANCELS METRO RAIL CONTRACT WITH JAPANESE FIRM

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County transportation officials, capitulating to a recession-weary public, unanimously agreed to cancel a $121 million contract for the Japanese firm, Sumitomo Corporation of America, to build 41 rail cars for a mass-transit system.

But the County Transportation Commission delayed opening the contract for rebidding.

Wednesday's vote was prompted by public outcry over last month's decision to award Sumitomo the contract over a Boise, Idaho, firm, Morrison-Knudsen, that pledged to do the job for $5 million less and hire nearly 2,000 more US workers.

Despite their vote, commissioners chastised some politicians for "whipping up" latent anti-Japanese sentiment in order to gain political clout.

Sumitomo made an attempt to save its contract, notifying the panel it had begun negotiations with General Electric to work as a major subcontractor.

A statement said the firm was disappointed that the contract was canceled for "non-business-related reasons."


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