When the policy-setting board of the Metro transit system voted nearly two years ago to buy $12.5 million worth of buses from Neoplan U.S.A. Corp., a normally upbeat Fairfax County politician named Joseph Alexander had an unusually downbeat prognostication.

"In the long run," he warned, "I think it's going to cost us."

Alexander, a veteran member of Metro's board of directors, then chairman of the American Public Transit Association and a member of the Fairfax County Board of Supervisors, had done some homework. He had uncovered a series of complaints about Neoplan buses, and sought to persuade Metro not to buy them.

Today, Metro's entire fleet of Neoplan buses is parked, awaiting possible repairs. Seventy-five buses were taken out of service after Metro inspectors found hazardous cracks near their front axles. One other was destroyed last December in a fire attributed to faulty electrical circuits.

Alexander's warning now appears, to a considerable extent, to have been on the mark. "We got stuck," he said a few days ago. "There's not a whole lot we can do with the buses we've got -- except get them fixed."

Why did Metro brush aside Alexander's objections and agree to buy buses from Neoplan, a West German-affiliated company that, at the time, had only been in business in the United States for two years?

In one sense, the answer is simple: Neoplan submitted the lowest bid for the deal. In other respects, the issue is more complex -- a many-sided reflection of the intricacies of government procurement policies and the instability of the American bus manufacturing industry in recent years.

The U.S. bus industry -- once dominated by two major producers, General Motors Corp. and Flxible Co. -- has expanded through the recent start up of several European-backed outfits, such as Neoplan, in search of new markets.

Meanwhile, the number of buses bought by American transit systems has plummeted -- from about 4,600 in 1981 to an estimated 2,300 last year.

At the same time, Metro and other transit systems, which rely heavily on federal funds to pay for buses, have sought to comply with shifting federal and local rules designed to ensure unfettered competition, avoid favoritism and keep bus costs down.

For Metro, these issues have long proved nettlesome. Many Metro officials, including Alexander, recall the agency's controversial 1973 purchase of 620 buses from AM General Corp., an American Motors Corp. subsidiary that later went out of the bus manufacturing business. The AM General buses have been found rife with defects.

"There's got to be a better way for an end user to be assured of a high-quality product," Metro Deputy General Manager Theodore G. Weigle Jr. said yesterday.

"Would I condemn our procurement process? Probably not," Weigle said. But he added, "Is there a better way to do it? Probably." Nevertheless, neither Weigle nor other federal and local transit officials said they were certain what improvements might be warranted.

When Metro decided to buy the Neoplan buses in June 1983, Weigle had praised the action, saying he expected the buses to be "as good as anything we've gotten in the last 10 years and, I hope, better." Yesterday he observed, "If I could Monday morning quarterback, I'm sorry I said it in light of what's happened."

Neoplan officials have not been available for comment. Statements issued by the Colorado-based company, affiliated with a West German bus manufacturer, Gottlob Auwaerter GmbH & Co., have described the buses as safe, promised repairs and said Metro officials "overreacted" by withdrawing them from service.

Although four companies initially expressed interest in selling buses to Metro in 1983, only two submitted bids. Neoplan underbid General Motors by about $275,000. After Alexander objected, Metro officials visited Neoplan's plant and investigated complaints. They said they were "convinced" that Metro should buy the buses.