Tip Sheet: Layoffs Expected at Cubic; Fare Vendor Discloses ‘New Operating Model,’ Though Releases Few Details
There is growing talk of layoffs at Cubic Transportation Systems, although it’s unclear how many employees will lose their jobs.
When asked, a Cubic spokesman did not immediately address the job cuts, but instead told Mobility Payments that the large fare-system supplier is “implementing a new operating model.”
Maitland Out at Cubic; CTS President Montgomery-Torrellas to Take Over ‘Growth’ Position Himself
David Maitland, who headed business development for Cubic Transportation Systems, is out after fewer than 18 months with the struggling fare-system supplier, Mobility Payments has learned. The vendor does not plan to hire a replacement.
Cubic in internal communication (see below) is officially calling Maitland’s departure a “retirement.” But most observers believe he was essentially forced out. They believe Maitland left because
Cubic to Launch Open-Payment Overlay Product, Introduces New Pricing Strategy, as It Seeks to Revamp Umo Offer
Cubic Transportation Systems plans to launch its “open-payment overlay” product within 90 days, seeking to give transit agencies the potential to launch open-loop payments with low upfront costs, like the Washington (D.C.) Metropolitan Area Transit Authority is doing with another vendor, Mobility Payments has learned.
Cubic has also introduced lump-sum pricing for new Umo ticketing contracts, deeming the old pricing strategy unsustainable.
Ratings Agency Warns of ‘Onerous Debt Burden’ for Cubic, but Says Vendor’s Transit Clients Shouldn’t Worry
S&P Global, a major ratings agency, has downgraded Cubic Corp.’s credit rating to CCC+ from an already low B-, warning of an "onerous debt burden" for the company that includes Cubic Transportation Systems.
The primary analyst for the ratings change told Mobility Payments, however, that the increased risk that the downgrade signifies is longer-term in nature and concerns the company’s debt holders, not transit agency clients.
Cubic Sues to Block Release of Records by LA Metro Related to Sole-Source Contract
Cubic Transportation Systems has gone to court to block Los Angeles Metro from releasing documents that are part of a $66.4 million no-bid contract upgrade Cubic won last year. The pending release stemmed mainly from a California Public Records Act request submitted by Mobility Payments.
In its lawsuit, which Cubic filed in California Superior Court Tuesday, the vendor argues that its pricing and other information it considers confidential and proprietary should be exempt from disclosure under the public-records law, largely because they are trade secrets. (Download the lawsuit petition below.)
U.S. Agency Releases First Details about Reasons for ‘Emergency Procurement’ to Replace Fare System; is It Enough?
Texas transit agency Capital Metro said 1.25 million fare transactions went unprocessed during a 30-day period last spring by its incumbent vendor, Siemens Mobility, according to the agency in a newly released document that seeks to justify the “emergency purchase” of a new fare system directly from Cubic Transportation Systems.
The document (download below), obtained by Mobility Payments, is the first explanation made public on the reasons for the fast-track procurement last summer.
Cubic Planning Open-Loop Payments Product as Part of New Business Unit
Cubic Transportation Systems’ new business unit, Mobility Essentials, which will oversee the vendor’s software-as-a-service ticketing platform, Umo, will also offer an open-loop payments product that has yet to launch, Mobility Payments has learned.
The vendor has put the new business unit within what it now calls its “Cubic Transportation Ventures”
In-Depth: Cubic’s Hardware-Free Option for Mobile Ticketing; Will It Find a Market?
Cubic Transportation Systems has introduced an option for riders to scan printed QR codes with the vendor’s Umo mobile-ticketing app, targeting its main North American market.
The option, first trialed by Cubic in taxis last year in Chile, is aimed at small transit agencies and paratransit operators. Its “ScanRide” product would allow the agencies to avoid
Cubic Hires Former Vix Chief as Head of Business Development, Replacing ‘Turnaround Expert’ in Post
Cubic Transportation Systems has replaced its head of business development–and turnaround expert–Rich Varos with fare-industry veteran and former head of Vix Technology David Maitland, Mobility Payments has learned.
The move, coming after Varos was in the job only little more than seven months, was unexpected. Few inside Cubic, even members of Varos’ team, are believed to have known about planned changes.
Cubic This Week Sees Transit Boards Act on Its Contracts in Four Major U.S. Cities–the Results were Mixed at Best
Board members for transit agencies in four major U.S. cities this week either proposed or approved changes to their contracts with the same fare systems vendor–Cubic Transportation Systems. Overall, it was not a particularly good week for Cubic.
The week started off badly for the vendor on two coasts, in New York and San Francisco.