Trains jobs boost questioned as Japan factory confirmed

The UK government faced growing controversy after awarding a £7.5bn contract to build new trains to a consortium including a Japanese company which will carry out some of the work in its own country.

Unions and Labour MPs questioned an announcement that 12,500 jobs will be created or safeguarded through the deal to build and maintain a fleet of new "super express" trains for the Great Western and East Coast main lines, replacing existing 20- to 30-year-old high-speed trains.

Agility Trains, made up of Hitachi, John Laing and Barclays, said it had drawn up a shortlist of three sites in Sheffield, Ashby de la Zouch in Leicestershire, and Gateshead for a new factory, which will eventually employ up to 500 workers.

The announcement was a blow to a rival consortium bidding for the contract, which included Bombardier, the only company making trains in the UK, with a factory in Derby employing more than 2,000 workers.

Express Rail Alliance, comprising Bombardier Transportation, Siemens, Angel Trains and Babcock & Brown, said it was "extremely disappointed" not to have been awarded the contract after spending 18 months on its bid.

Labour MP Bob Laxton (Derby North) said the decision was "bad news" for Derby and for the rest of the UK and questioned the number of jobs said by the government to be created or safeguarded.

"This is a crass decision which gives the Japanese an opportunity of getting into the UK market. I don't believe for one moment the figure of 12,500 jobs because work will be brought into the UK from overseas."

Agility Trains said it was committed to spending 70 per cent of the contract value in the UK, adding that Hitachi and John Laing expected to create 2,500 skilled engineering jobs in the UK in train manufacturing, construction and maintenance.

But it was confirmed that trains will be built at a Hitachi factory in Kasado, Japan, leading unions to call for urgent talks with the government.

Keith Hazlewood of the GMB said: "We need to clarify what on earth is going on and how much work will be done in this country."

It is understood that Transport Secretary Geoff Hoon has met with officials from Bombardier. The company's factory in Derby is currently working flat out on five production lines making trains for a number of UK rail firms, but much of the work will run out at the end of 2010.

Hoon also announced the Transport Department (DfT) was in advanced negotiations with National Express East Anglia to provide 120 new carriages for the Stansted Express service from London Liverpool Street to Stansted Airport, with Bombardier as the preferred bidder.

Agility Trains said it was in active discussions with 20 UK suppliers, which will have a knock-on effect of safeguarding jobs in the UK.

The new fleet of Hitachi Super Express Trains will provide more seats and are three times more reliable than existing fleets, said the consortium.

Trains will be serviced, maintained and cleaned around the UK at five new state-of-the-art train maintenance centres and several upgraded existing facilities.

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