Potential up to 2,000 job losses at Alstom Derby

[Speed43125]

Amtrak bought a single deck version. Either way, you are correct, and seeing Alstom's track record with them so far it probably would've been an automatic no-go.

AIUI, the passenger 'coaches' in the Amtrak Avelia's are in fact New Pendolino based.

Looks like Paintbox Transportation (a company that paints trains at Alstom Derby) is appointing Administrators

Does anyone have any idea what other firms, if any, are based at Derby and directly rely on the train factory?

 

[Mikey C]

There will be plenty of trains needing building over the next 5 years or so, mostly bi/tri-modes.
The question is whether Derby can produce competitive designs to meet those requirements.
Or find export work.

As an example, the Hitachi class 802 fleet was assembled in three different locations: Kasado in Japan, Pistoia in Italy and Newton Aycliffe in Co Durham.
Could Alstom do similar with its products and include Derby in its wider production plans?

Isn't the issue that while UK gauge trains will hit on the continent, the reverse isn't true.

And Derby is as far as you can get from the coast as you can get really, unlike Newton Aycliffe, Goole or Newport when you compare it with the 3 recently opened assembly plants.

 

[Merle Haggard]

Well, I believe a couple of the ex-EMR 180s are parked up… just in case LNER get really desperate

Didn't the 180s (and for that matter, the 175s) have a C.A.F. involvement?
More relevant to the LNER C.A.F. thread, though

 

[1Q18]

What would Alstom have brought to LNER? The HS2 trains are based off Hitachi trains, Alstom has nothing to offer in that space.

ISTRC Bombardier were touting a 125mph Aventra derivative some years ago? Although I imagine Alstom will be very happy to let the Aventra programme die once the current orders are finally fulfilled.

 

[LNW-GW Joint]

Classes 175 and 180 are Coradias.

But the current models offered don't have much in common with the Coradia/Juniper range produced at Washwood Heath c2000.

 

[Peter Sarf]

But the current models offered don't have much in common with the Coradia/Juniper range produced at Washwood Heath c2000.

An example of a train making factory that did not last long once Alstom had acquired it.

What we need in the UK is a rolling program of train replacement rather than boom and bust. Same as should happen with electrification.

I don't mind us importing trans and I don't expect better than about 60% UK content whether built in the UK or not. But what is unhealthy is if we don't export as well as import.

 

[GRALISTAIR]

An example of a train making factory that did not last long once Alstom had acquired it.

Informed Sources 4th Law?

 

[Energy]

But what is unhealthy is if we don't export as well as import.

The difficulty is that European trains don't fit in the UK gauge so Derby would have to export by road for a long distance, which isn't very cost-efficient.

CAF Newport being by a port is in a good position and CAF supposedly has export work lined up. Hitachi can now manufacture bodyshells at Newton Aycliffe and it is in a somewhat good position but Hitachi's other European orders have been in Italy where they have the former AnsaldoBreda plant. Newton Aycliffe is better positioned for export work to Germany, Scandinavia, etc.

What we need in the UK is a rolling program of train replacement rather than boom and bust. Same as should happen with electrification.

Agreed, we need long contracts with trickle deliveries rather than boom and bust.

 

[Snow1964]

Meanwhile Siemens has apparently acquired another building next to its train building site in Goole.

Clearly Siemens must have a reason, are they expanding build capacity for some as yet unannounced order, that Derby didn't win?

Siemens has agreed a pre-let deal on a unit in East Yorkshire adjacent to its existing rail facility.

Trebor Developments and Hillwood have exchanged contracts with Siemens to pre let the 94,841 sq ft Point 36 Goole unit.

Trebor secured detailed planning consent for the proposed unit, before entering into discussions with Siemens.

The unit is located adjacent to Junction 36 of the M62 Motorway and opposite Siemens' rail facility, which finished construction earlier in 2023.

Siemens pre-lets East Yorkshire unit - Insider Media

Siemens has agreed a pre-let deal on a unit in East Yorkshire adjacent to its existing rail facility.

www.insidermedia.com

 

[Energy]

Meanwhile Siemens has apparently acquired another building next to its train building site in Goole.

Clearly Siemens must have a reason, are they expanding build capacity for some as yet unannounced order, that Derby didn't win?

Siemens pre-lets East Yorkshire unit - Insider Media

Siemens has agreed a pre-let deal on a unit in East Yorkshire adjacent to its existing rail facility.

www.insidermedia.com

Siemens have a good business in the UK making train parts (a lot of in cab radios) and software. I wouldn't be suprised if they were expanding their export&domestic component business.

 

[YorkRailFan]

ISTRC Bombardier were touting a 125mph Aventra derivative some years ago? Although I imagine Alstom will be very happy to let the Aventra programme die once the current orders are finally fulfilled.

Judging by the issues that Alstom has had with the Aventra, I doubt that they will willing want to make a 125mph capable derivative anytime soon if ever.

 

[Peter Sarf]

Siemens have a good business in the UK making train parts (a lot of in cab radios) and software. I wouldn't be suprised if they were expanding their export&domestic component business.

Indeed. I recall it being said years ago that even Siemens' early trains for the UK (350, 444 & 450) manufactured in Germany had more UK content in them than Bombardier (was it ABB ?) Derby did !.

 

[Mikey C]

An example of a train making factory that did not last long once Alstom had acquired it.

What we need in the UK is a rolling program of train replacement rather than boom and bust. Same as should happen with electrification.

I don't mind us importing trans and I don't expect better than about 60% UK content whether built in the UK or not. But what is unhealthy is if we don't export as well as import.

What was a loss was the old GEC traction motor side. Less "visible" than the train assembly plants, but higher tech, and the default supplier for most British EMUs. And more exportable too.

The various takeovers meant that this business became part of Alstom, and thus Derby built EMUs got their traction equipment from within the Adtranz empire. And Preston went down with Washwood Heath...

 

[Peter Sarf]

What was a loss was the old GEC traction motor side. Less "visible" than the train assembly plants, but higher tech, and the default supplier for most British EMUs. And more exportable too.

The various takeovers meant that this business became part of Alstom, and thus Derby built EMUs got their traction equipment from within the Adtranz empire. And Preston went down with Washwood Heath...

Indeed. I seem to recall that Derby ended up using less and less UK parts.

The UK really needs to look at what is strategically important. I worry about the steel industry for example.

The UK is sleep walking towards conflict with China meanwhile the Chinese know we are very dependant on them for more and more critical components.

 

[3RDGEN]

In the last ten years or so we have gone from one new build/assembly site to four so not exactly a contraction, CAF/Newport & Siemens/Goole have work and Alstom/Hitachi have the HS2 contract between them on their books. Northern & Chiltern have got tenders out for potential new builds so there's work there, Alstom just need to win a contract by offering the best product and then delivering it.

The Derby new build side will have to be mothballed for the next few years until HS2 work starts or new contracts come on stream but design work at Derby continues. A mothballing of Derby allows Alstom to decide if it makes sense to move manufacturing to a new purpose built facility on the Widnes site, as per the original plan prior to buying Bombardier, then sell up in Derby. If the Alstom HS2 trains build content is Derby or Widnes it makes no difference.

Another option in the short term is to use Derby as a storage facility for new build / spare units as that's in demand, EMR only recently issued a tender for storage space.

 

[Sad Sprinter]

This is exactly why we need a joined up and integrated industrial policy in this country. Sadly we think we can have an economy supported by Cambridge and The City

 

[Snow1964]

Stock market news, Wednesday 15th
Alstom to cut 1500 jobs (doesn't say where) and sell off some parts of business to cut net debt by €2bn

(Bloomberg) -- Alstom SA is cutting jobs and selling assets to shore up its balance sheet after cash-burn concerns wiped hundreds of millions of euros off the train maker’s market value.

The French manufacturer has started a divestment program to raise as much as €1 billion ($1.1 billion), it said Wednesday. Alstom also plans to reduce around 1,500 positions and is eyeing a capital increase with preemptive rights for its shareholders.

The moves are meant to quell investor concerns after Alstom slashed its full-year forecast for free cash flow last month in response to a jump in inventories and delays to a major UK project. The outlook cut prompted a selloff in the company’s stock, adding to woes from Alstom’s troubled $5.5 billion acquisition of Canadian manufacturer Bombardier Inc.

“We’ll do whatever is needed to keep this strong balance sheet,” Chief Executive Officer Henri Poupart-Lafarge said in an interview with Bloomberg Television.

With the measures, Alstom aims to maintain its investment grade rating and reduce net debt by €2 billion by March 2025. The job cuts represent close to 10% of total sales and administrative positions and won’t affect engineering or factory workers.

Nearly three years after the purchase of Bombardier’s rail business, Alstom continues to wade through costly legacy contracts from its former competitor. It has blamed mismanagement by Bombardier for delivery delays and the heavy spending needed to complete them.

Read more: Alstom Open to Asset Sales After Warning Erases $3 Billion

It’s too early to say which assets will be sold, Poupart-Lafarge said in the interview, adding that a capital increase is an option but not the company’s preferred one.

Equity and equity-like issuances, including the refinancing of certain assets, also are part of the performance program. Alstom said it remains “flexible” on the sequencing and rightsizing of such instruments.

On Oct. 31, the manufacturer signed a new €2.25 billion liquidity line with an international bank and in July will propose former Safran SA CEO Philippe Petitcolin as board chairman.

The company said last month it was expecting a delay to the UK Aventra project it inherited from Bombardier, which includes 443 trains that serve lines such as the London Overground and Elizabeth Line. Alstom said the work should be completed during fiscal 2024-25 instead of in the first half of this year.

Alstom recorded negative free cash flow of €1.12 billion in the six months through September. The company sees negative free cash flow of as much as €750 million for the full fiscal year, compared with a previous forecast of “significantly positive” results.

Alstom Charts Cost-Cutting Course to Slash €2 Billion in Debt - BNN Bloomberg

Alstom SA is cutting jobs and selling assets to shore up its balance sheet after cash-burn concerns wiped hundreds of millions of euros off the train maker’s market value.

www.bnnbloomberg.ca

 

[LNW-GW Joint]

The job cuts represent close to 10% of total sales and administrative positions and won’t affect engineering or factory workers.

That's a very interesting position to take, though there must be concerns for when the Aventra construction and rectification work completes.
It will also be very interesting to see where any cutbacks fall outside the UK, and which assets are to be sold off.

 

[Bornin1980s]

That's the fourth foreign owner of the BREL assets. Why do they keep pulling out? Is it a toxic liability that bankrupts every owner?

 

[LNW-GW Joint]

Despite the corporate announcement, it appears Alstom has put 1300 production jobs at risk at Derby.

Alstom: Train manufacturer puts 1,300 jobs at risk in Derby

The manufacturer says its factory in Derby has no confirmed work beyond the first quarter of 2024.

www.bbc.co.uk

More than 1,300 jobs have been put at risk at the UK's biggest rail assembly factory.
Alstom is consulting on job losses at its Litchurch Lane factory in Derby, which has no confirmed workload beyond the first quarter of 2024.
Work on trains for HS2 is scheduled to start at the site in late 2026 but there is a gap in orders from early next year.
The BBC understands 550 permanent jobs and 780 temporary jobs are at risk.
An Alstom spokesperson said the company had been working with the government over the past six months in a bid to secure a "sustainable future" for the factory.
"No committed way forward has yet been found and therefore it is with deep regret that we must now begin to plan for a significant reduction in activity at Derby by entering a period of collective consultation on potential redundancies at Litchurch Lane," they said.

They continued: "We will fully support our dedicated colleagues during this exceptionally difficult time.
"We look forward to fulfilling our commitments on HS2 and successfully competing for rolling stock opportunities across the UK in the future.
"We remain open-minded as to the future of non-production functions located at Litchurch Lane and to potential future alternative uses for the Derby site.
"We will begin an extensive review of options, and will fully involve our stakeholders in this process."

That's the fourth foreign owner of the BREL assets. Why do they keep pulling out? Is it a toxic liability that bankrupts every owner?

None of them pulled out.
The four successive owners were the result of consolidation in the European train building industry, all of which continued production at Derby.
BREL->ABB->ADtranz->Bombardier->Alstom.
Once the business was bought by ABB, Derby was a relatively small part of the owner's portfolio, and subsequent buy-outs were more about consolidating production across the EU than in the UK.
Bombardier was in deep trouble outside the UK and in its aircraft business, now mostly divested.
Alstom is still struggling with the consequences of its acquisition of Bombardier.
But they do have a huge order backlog worth €90 billion, unfortunately not much of that in the UK.

 

[jimgthornton]

I am struggling to think of a single British train export order to Europe between the EEC becoming the EU in the early 90s and the UK leaving the EU. I think the Milan metro work at Newton Aycliffe was after the transition period. The only other orders that I am aware of were to Thailand and South Africa. The effect of brexit on British train manufacture is very much theoretical. Yes, it would be easier if we were still in the EU but why would it be different to when we were in the single market?

Two days after the referendum caught a French train from Bergerac to Siorac along the Dordogne. Beautiful new carriages built by Bombardier in Derby. Not likely many more. Derby voted for Brexit & are reaping the consequences.

 

[Chester1]

Two days after the referendum caught a French train from Bergerac to Siorac along the Dordogne. Beautiful new carriages built by Bombardier in Derby. Not likely many more. Derby voted for Brexit & are reaping the consequences.

Have you found any details of that order? Are you sure they were made in Derby? It seems like there might have been three small export orders between 2000 and 2020 and only the one you mention was to the EU. In that context talking about consequences of brexit seems ideological. One small EU order in 20 years won't make any difference to the viability of the factory!

 

[Sonik]

Despite the corporate announcement, it appears Alstom has put 1300 production jobs at risk at Derby.

Alstom: Train manufacturer puts 1,300 jobs at risk in Derby

The manufacturer says its factory in Derby has no confirmed work beyond the first quarter of 2024.

www.bbc.co.uk

Alstom is still struggling with the consequences of its acquisition of Bombardier.
But they do have a huge order backlog worth €90 billion, unfortunately not much of that in the UK.

We do have to wonder if the announcement of such substantial job losses is intended to embarrass the government into producing some work for Derby, similar to what happened with the Class 345 order.

Unfortunately the current government don't seem to care about loosing the last UK designed train manufacturer, a capability we will never get back once it's gone.

 

[Invincible]

There was some kind of agreement for some 10 test hydrogen and battery Aventra trains in 2021, but never ordered.
The hydrogen trains in Germany were not working out as expected.

Alstom and Eversholt Rail sign an agreement for the UK’s first ever brand-new hydrogen train fleet

A Member of Eversholt UK Rails Group

eversholtrail.co.uk

But Porterbrook and LNER have made a firm order for 10 tri mode trains from CAF.

10 new Tri Mode trains for London North Eastern Railway

London North Eastern Railway has announced it has ordered 10 new Tri-Mode trains from train manufacturer, CAF.

www.railadvent.co.uk

Rail Minister, Huw Merriman, said: “Replacing ageing rolling stock is crucial to the sustainability,
reliability and growth of our rail network, and I'm delighted passengers travelling on LNER services will benefit from improved services and greener journeys on these modern trains.
Private sector investment plays an important role within the UK rail industry and this order will help
drive economic growth across the country while supporting skilled jobs.”

 

[Chester1]

We do have to wonder if the announcement of such substantial job losses is intended to embarrass the government into producing some work for Derby, similar to what happened with the Class 345 order.

Unfortunately the current government don't seem to care about loosing the last UK designed train manufacturer, a capability we will never get back once it's gone.

Its hard to see what the order would be. Alstom didn't bid for the LNER tri mode tender. They have chosen to specialise Derby on a problematic EMU platform that will receive no export orders. The mono rail units are a niche product. There is little demand for new EMUs in UK for while. I can't see how a massive reduction in capacity at the factory can be avoided. Its current work finishes in Spring. Whether it closes will come down to whether Alstom is prepared to keep it open with bits and pieces of export work until HS2 work starts.

The design work is the most important aspect because its unique. It wouldn't be awful for UK industry if they decided to close Litchurch Lane, move the R&D to an out of town site and assemble trains in Widnes.

 

[Mikey C]

What will Widnes do once the 390 refurbishment work is finished?

 

[Dan G]

If there's still design work happening in Derby where is the product? Obviously bi or even tri-mode power systems need to be put under Aventra body shells. So far it seems Alstom hasn't done that.

 

[ScotGG]

Its hard to see what the order would be. Alstom didn't bid for the LNER tri mode tender. They have chosen to specialise Derby on a problematic EMU platform that will receive no export orders. The mono rail units are a niche product. There is little demand for new EMUs in UK for while. I can't see how a massive reduction in capacity at the factory can be avoided. Its current work finishes in Spring.

Southeastern put out a tender about 13 months ago.

They have about 150 Networkers which entered service about 31-32 years ago and were being built 35 years ago. Many are now in *very* tired condition.

It would have made sense to keep production going to replace Networkers as they get between 35-40 years since built. Same third rail stock as the 701s.

There is a need for new EMUs. The 701 mess though makes in unlikely coupled with a reluctance by government to invest.

 

[YorkRailFan]

Southeastern put out a tender about 13 months ago.

They have about 150 Networkers which entered service about 31-32 years ago and were being built 35 years ago. Many are now in *very* tired condition.

It would have made sense to keep production going to replace Networkers as they get between 35-40 years since built.

There is a need for new EMUs. The 701 mess though makes in unlikely coupled with a reluctance by government to invest.

Siemens could have been a very likely candidate but the lack of a production facility in the UK (apart from Goole for the 2024 stock) meaning that CAF or Stadler is the most likely. But that's all for a different thread.

 

[ScotGG]

I wouldn't be surprised if govt do green light Aventras for SE in some respects.

Politically it saves the Derby plant. In Kent they can say they've secured new trains. In an election year that could be a factor in the decision.