RAILTRACK THIS week warned suppliers that its investment programme will run out of money if they push up prices to exploit looming skill shortages.
Railtrack's own spending plans, coupled with those of the rail regulator, shadow Strategic Rail Authority and government, will put huge pressure on industry capacity, said its supply chain director Les Mosco.
As clients compete for the best suppliers prices could increase dramatically.
'But Railtrack does not have unlimited funds. The regulator and shareholders give us money to spend and if the unit price starts to escalate we don't have an unlimited pot. If we don't meet our performance targets then our funds go into a downward spiral, ' said Mosco.
'If contractors and suppliers seek to take advantage (of capacity problems) they may well kill the goose. Jointly we need to manage this quite carefully.'
Railtrack is hoping long term alliances with key suppliers will help keep a lid on prices.
Supply chain and contract supply organisations are being merged next week into Mosco's supply chain directorate. Former contract and supply director David Meek has moved to the commercial directorate as director, risk management.