Yahoo Finance Britain’s biggest train factory to lay off hundreds of staff
Britain’s biggest train factory is preparing to lay off hundreds of staff after completing its final production run with no prospect of further work in sight.
Managers at the Alstom plant in Derby have restarted a voluntary redundancy process that was paused in January amid optimism about new government contracts.
Talks with the Department for Transport (DfT) have since stalled, and Alstom is now expecting to announce cuts among its 3,000-strong workforce.
Onsite workers employed by suppliers are likely to lose their jobs, while the bulk of Alstom’s 1,200 blue-collar staff at Derby will run out of work once the testing and evaluation of completed trains ends in four or five months.
Birmingham-based Solo Rail Solutions, which makes train interiors, seats and doors, went into administration last month and counts the Derby plant as one of its main customers.
Alstom has not yet raised the prospect of closing the Litchurch Lane site, which supports a further 15,000 jobs in the supply chain. However, this step is viewed as inevitable without new business to bridge a gap of more than two years until work begins on trains for HS2.
Train construction in Derby ended on March 21 with the completion of contracts to supply vehicles for the Cairo monorail and the last Aventra electric railcars.
Alstom has since informed the Government that it is taking steps to cut costs, with mothballing operations not regarded as viable for an extended period.
Alstom’s managing director for the UK and Ireland, Nick Crossfield, has said it first raised the looming production gap with Transport Secretary Mark Harper in May 2023, before being informed in March 2024 that no work would be forthcoming.
Labour has indicated that it would seek to save Litchurch Lane, but Paris-based Alstom may be reluctant to hold off on redundancies until a general election in October or November.
The company made several proposals to safeguard the future of the factory in the talks with the DfT, pressing it to issue fleet tenders for Southeastern Trains, Northern Rail, Transpennine Express and Chiltern Railways, which will all require rolling stock in coming years.
New tenders can take three years before the first metal is cut however, and would not help overcome the immediate manufacturing drought, leading Alstom to also propose short-term fixes, including the acceleration of fleet-refurbishment requirements and the conversion of existing order options for London’s Elizabeth Line trains and another operator.
A DfT spokesman said: “Rail manufacturing plays an important role in growing the UK economy. The Government is committed to supporting the entire sector and we remain in close contact with Alstom to secure a sustainable future for rail manufacturing at Derby.”
Alstom is also sceptical that the HS2 order for an initial 54 train sets will remain on schedule, suspecting that it could be pushed back.
The Derby plant isn’t due to commence work on the state-of-the-art trains until mid-2026, taking over body shells built by joint venture partner Hitachi – itself running short of work at its factory in Newton Aycliffe – for fitting out and testing.
It is even more unlikely that trains planned for the now abandoned extension of HS2 to Manchester and Leeds will ever be ordered, even though services from London will run beyond the high-speed network to those cities.
Trains have been made in Derby since 1840, with the Litchurch Lane works opening in 1876. The plant was privatised in 1989 and became part of Bombardier before the Canadian firm’s purchase by Alstom in 2021.
