Differences of opinion over new Hitachi plant

Posted on 1 Sep 2011 by The Manufacturer

After Derby-based Bombardier lost out on two separate train-building contracts, there is a marked difference of opinion over the benefits the new Hitachi factory in Newton Aycliffe will bring.

After securing the contract to supply 1,400 carriages to train operators on East Coast and Great Western train lines, Agility Trains Ltd (a partnership including Hitachi, Barclays Private Equity and UK developer John Laing) estimated that the contract would pump over £600m into Newton Aycliffe’s local economy, and create 700 jobs – 500 inside the factory and 200 jobs building the factory.

Figures inside Durham County Council and Hitachi have also highlighted the benefits the operation would bring to a large number of suppliers in the UK.

The contract is yet to be signed by the government – Durham County Councillor Neil Foster told The Manufacturer that he expects it to be signed by the end of this year. “The Hitachi project is on time and progressing well. The council is working with the firm and site team to ensure we maintain progress,” he said.

Figures inside the RMT transport union are sceptical about the government’s decision, and pointed out that the train carriages will only be assembled in the UK, not manufactured from scratch as they would have been if Bombardier had won the contract.

An RMT spokesperson told The Manufacturer that although Hitachi had been in ‘active discussions’ with 20 UK suppliers, they are not obliged to work with them. “Hitachi’s UK manager, Alistair Dormer has already confirmed that the company is not obliged to use any of the 20 UK suppliers under current UK procurement law,” they said.

Hiroshi Nakayama, President and CEO of Hitachi’s Rail Systems Company and Akira Horie, CEO of the Rail Systems Division both went to see the Newton Aycliffe site in August. As well as visiting the site, Mr Nakayama and Mr Horie visited Locomotion No 1 in the Darlington Railway Museum.

George Archer