Staff Report #3
November 17, 2025
To All Commissioners
Re: 2027 Bus Replacement and Rapid Transit Bus Orders
Recommendation
That the report be RECEIVED for information.
Background
Given the extended timeframes associated with bus delivery over the past number of years, Administration has recommended proceeding with replacement and expansion bus orders well in advance of the required date. In April 2024, the Commission approved the purchase of both 2024 and 2025 replacement buses, and in February 2025, the commission approved the purchase of the 2026 replacement and expansion buses. The 2024 and 2025 replacement buses were not delivered until early 2025, which resulted in bus availability issues impacting the ability to implement fall service levels in September. As has been previously discussed, the buses have now been prepped and placed into service and regular fall service levels will return effective November 23, 2025. The 2026 replacement and expansion bus order is scheduled for delivery beginning in May 2026.
In addition to the 2027 bus replacement, which calls for the purchase of 17 buses (15 – 40’ and 2 – 60’ buses), the buses required for the East Leg of the rapid transit launch in the fall of 2027 will need to be included in this order in order to ensure they are received and available for service to meet the scheduled launch date.
Consistent with contract provisions, each year administration requests pricing for the buses required and New Flyer provides same based on the pricing formula set out in the multi-year contract. Unfortunately, due to the ongoing tariff uncertainty as well as the change in EPA standards for 2027, New Flyer has indicated they will not be in a position to provide firm pricing until mid-late December; however, they have committed to holding a place in the assembly line for the LTC order based on our initial date of request for pricing.
New Flyer was able to provide an estimated cost for each type of bus required, which will provide Administration with the opportunity to identify potential budget implications and options to address same, all of which will be included in the January staff report seeking Commission approval for the order. The table below sets out the budget impacts on the 2027 Bus Replacement Program based on the estimated pricing that has been provided by New Flyer. The estimated pricing provided, exclusive of taxes, is set out in the table below.
| Bus Model | Estimated 2027 Price |
| 40’ Diesel Bus | $997,535 |
| 60’ Diesel Bus | $1,521,793 |
These prices represent an approximate 7% increase over 2026 pricing for both the 40’ and 60’ buses.
The following table sets out the impact of the quoted pricing on the 2027 Bus Replacement Program budget.
2027 Bus Replacement Program
| Description | Units | 2027 Budget Amount | Projected Cost | Variance |
| Bus Replacement (40’) | 15 | $ 14,643,000 | $ 15,226,500 | $ 583,500 |
| Bus Replacement (60’) | 2 | 2,978,800 | 3,097,200 | 118,400 |
| Ancillary Equipment | 773,500 | 773,500 | – | |
| 17 | $ 18,395,300 | $ 19,097,200 | $ 701,900 |
Based on the approximate numbers provided, the recommended funding source to cover the approximate $0.701 million shortfall would be either to rely on the Provincial Gas Tax reserve to cover the shortfall, or to submit a higher overall program cost and related increase in City of London funding as part of the 2027 Capital Budget submission. It should also be noted that the Baseline Funding Stream of the Canadian Permanent Transit Fund is anticipated to begin flowing in April 2026, and bus procurement was one of the projects identified as a potential use for that funding program. A final recommended source of funding for any shortfall will be included in the January report seeking approval for the 2027 Bus Replacement Program bus order.
Rapid Transit Bus Requirements
In addition to placing the order for the 2027 replacement buses, the buses required to operate the East Leg of the rapid transit need to be ordered in order to ensure they are delivered and available for service for the planned launch in the fall of 2027. LTC Administration will be working directly with Civic Administration once final pricing has been obtained to identify any budget impacts associated with this program as well as identifying options to address same. Details with respect to the approach for this program will also be included in the January staff report to the Commission.
Recommended by:
Craig Morneau, Director of Fleet and Facilities
Mike Gregor, Director of Finance
Concurred in by:
Kelly S. Paleczny, General Manager