Wellington electronic-card supplier Snapper Services has come out swinging against a decision by Auckland Transport to sack it from the region's troubled public transport ticketing project without any apparent compensation.

The Infratil subsidiary and sister company of the region's main bus operator, NZ Bus, vowed last night that "all necessary steps will be taken to recover losses arising from the wrongful termination".

It warned that Auckland ratepayers would be the casualties, saying the ultimate cost of the decision by the council transport organisation's board at an emergency meeting yesterday afternoon was likely to the significant, boosting what it believed had already been more than $100 million spent on developing a public transport ticket across most of the region's buses, trains and ferries.

"Snapper's clear legal position is that it has not breached its contract with Auckland Transport," said chairwoman Rhoda Phillippo.


"The fault lies with Auckland Transport, the New Zealand Transport Agency and the French multinational Thales for not providing the critical components for successful integration."

Thales won the main $87 million supply and operating contract for an integrated Hop ticket ahead of Snapper, after the local company held up a tendering process for more than six months by claiming impropriety by a former Auckland Regional Transport Authority official, whom the Transport Agency cleared of blame.

Yesterday, Auckland Transport announced that it had decided to terminate a "participation agreement" by which Snapper was allowed to supply an early Hop card last year to the 650-strong NZ Bus fleet.

The organisation said it had concluded Snapper was unable to meet a stretched deadline of November 30 to make its card readers compliant with the wider scheme, for which the Transport Agency is paying $56 million and Auckland ratepayers $42 million. It said Thales now had the task of adding the region's bus fleets to the scheme, but that would not start until April.

The Weekend Herald understands that follows difficulties also faced by a separate consortium supplying equipment to smaller bus firms.

But a defiant Ms Phillippo said last night that NZ Bus would continue to operate "HopSnapper" cards, of which there are almost 200,000 in circulation in Auckland, and for which her company had "never received any compensation for its integration efforts".

The transport organisation's chief executive, David Warburton, said earlier that it had "terminated its participation agreement" with Snapper in the interests of "protecting Aucklanders' money and progressing the essential outcome of a first-class integrated ticketing programme for public transport in the region".

"This is a regrettable decision but follows our conclusion that Snapper could not modify its system in a suitable timeframe to make it compliant with the technology being progressively developed for Auckland Transport by French firm Thales," Dr Warburton said.


It is understood Snapper sought an exit payment of $12 million, but was rebuffed by Auckland Transport's board.

Despite Ms Phillippo's complaint that Snapper had not received compensation, its early Hop version was rolled out under a $1 million marketing budget from Auckland Transport.