Alstom - 1,330 Jobs At Risk At Derby

[4630]

Probably not a great surprise, but clearly very worrying to staff directly affected and those in the supply chain too.
 

http://alstom: Train manufacturer puts 1,330 jobs at risk in Derby

[pete_mcfarlane]

Doesn't this happen every few years with Derby Works? 

[AMJ]

Then by some fluke of the tendering system a few operators make orders for new stock.

 

Not like the way that Skoda got a large expression of interest for far more locos than one country needed before they joined the EU so that they can call on them indefinitely without needing to tender.

[Ron Ron Ron]

How many old 2nd generation DMU’s and EMU’s are left that’ll need replacing in the next 5 to 10 years?

Basically, anything left from the BR era, which will be 30+ years old by now.

 

150, 153, 155, 156, 158, 159, 319, 321/2/3  etc ?

 

There will be a need to start replacing more modern, 3rd gen, post privatisation trains in the 2030’s and 40’s.

What remains of domestic train building capacity may be gone by then.

 

 

.

 

Edited November 15, 2023 by Ron Ron Ron

[brushman47544]

1 hour ago, Ron Ron Ron said:

How many old 2nd generation DMU’s and EMU’s are left that’ll need replacing in the next 5 to 10 years?

Basically, anything left from the BR era, which will be 30+ years old by now.

 

153, 156, 158, 159, 319’s etc ?

 

There will be a need to start replacing more modern, 3rd gen, post privatisation trains in the 2030’s and 40’s.

What remains of domestic train building capacity may be gone by then.

 

Isn't there already an order with Alstom for delivery of trains in 2026? Why is it that these large multi-nationals appear to be able to keep manufacturing going in other countries around Europe but don't seem concerned to allocate orders to UK sites to keep them operational? Even orders for the UK are now often built abroad. Other countries seem to be able to require "in country" manufacturing but we don't... As you say, the way its looking there will be no domestic train building capacity left by the time we need it.

 

 

[phil-b259]

1 hour ago, brushman47544 said:

 

Isn't there already an order with Alstom for delivery of trains in 2026? Why is it that these large multi-nationals appear to be able to keep manufacturing going in other countries around Europe but don't seem concerned to allocate orders to UK sites to keep them operational? Even orders for the UK are now often built abroad. Other countries seem to be able to require "in country" manufacturing but we don't... As you say, the way its looking there will be no domestic train building capacity left by the time we need it.

 

 

 

Because the UK has a number of logistical problems (and now being outside the EU doesn't help when it comes to supplying EU countries due to increased tariffs). For starters the restrictive UK loading gauge which means additional costs in transporting locos or units by road to ports for shipping for example....

 

There is also the wider problem that with the UK Governments being wedded to right wing free market principles / privatisation and putting a massive emphasis on shareholder dividends / financial performance in the City of London markets rather than caring where the owners of business are based, UK sites are particularly vulnerable to cuts....

 

Put it this way - if you are a train builder headquartered in France (and thus pay most of your tax to the French Government) then getting rid of French workers is going to cause a mighty stink - not least because those workers you get rid of can, through elections and thus changes in Government policy, make the business environment very difficult for the CEOs and top management of the organisation.

 

By contrast if the train builder cuts jobs in the UK then there is very little effect at cooperate level, particularly as UK Governments have adopted this 'we must not interfere in the operation of the free market' (unless it involves banking / financial services of course) so the consequences for the train builder are minimal.

 

Now if instead of sitting back and letting UK manufacturing / service provision / utilities being asset stripped by every other nation just to make a quick buck in the City of London, the UK Government had made hostile / overseas takeovers more difficult and retained a controlling stake (shareholder wise) in certain businesses then, as happens overseas, we might find companies are less quick to shut UK facilities 

 

 

Edited November 15, 2023 by phil-b259

[GMKAT7]

Good afternoon folks,

 

When I was involved with the 158/159 PRM and refurbishment modifications in 2015 onwards the lead ROSCO (starts with P, ends with k) advised us as the design consultancy that they were looking for another 10 years service out of the modified units.

 

So that would take them to 2025 plus, and make the vehicles 35 plus years old given their 1988-1990 build dates.

 

Something needs to replace all the 15x units. Given the recent East Coast 10-car order, expect a contract for 'Cheap As F***). Not good for the Derby employees or our local economy.

 

Cheers, Nigel.

[phil-b259]

2 hours ago, GMKAT7 said:

 

Something needs to replace all the 15x units. Given the recent East Coast 10-car order, expect a contract for 'Cheap As F***). Not good for the Derby employees or our local economy.

 

 

The problem is that orders are needed NOW, not in 12 -18 months so as to give the workers something to build once current orders are completed.

 

Given the restrictive UK loading gauge (and thus the need for a bespoke design - as opposed to being able to quickly dusting off the plans for an EU wide design) its even more important that orders are placed in a timely fashion and the Government (without whose permission TOCs cannot as much as sneeze at the moment), or rather HM Treasury need to stop sitting there with their fingers in their ears hoping they can make the current fleet last a bit longer.
 

Unfortunately with the current lot only interested electioneering and a large part of the Tory party pressing for tax cuts before the next general election I don't see HM Treasury changing its tune however much Alstom say jobs are at risk…

Edited November 15, 2023 by phil-b259

[adb968008]

9 hours ago, phil-b259 said:

 

Because the UK has a number of logistical problems (and now being outside the EU doesn't help when it comes to supplying EU countries due to increased tariffs). For starters the restrictive UK loading gauge which means additional costs in transporting locos or units by road to ports for shipping for example....

 

There is also the wider problem that with the UK Governments being wedded to right wing free market principles / privatisation and putting a massive emphasis on shareholder dividends / financial performance in the City of London markets rather than caring where the owners of business are based, UK sites are particularly vulnerable to cuts....

 

Put it this way - if you are a train builder headquartered in France (and thus pay most of your tax to the French Government) then getting rid of French workers is going to cause a mighty stink - not least because those workers you get rid of can, through elections and thus changes in Government policy, make the business environment very difficult for the CEOs and top management of the organisation.

 

By contrast if the train builder cuts jobs in the UK then there is very little effect at cooperate level, particularly as UK Governments have adopted this 'we must not interfere in the operation of the free market' (unless it involves banking / financial services of course) so the consequences for the train builder are minimal.

 

Now if instead of sitting back and letting UK manufacturing / service provision / utilities being asset stripped by every other nation just to make a quick buck in the City of London, the UK Government had made hostile / overseas takeovers more difficult and retained a controlling stake (shareholder wise) in certain businesses then, as happens overseas, we might find companies are less quick to shut UK facilities 

 

 

And less willing to invest…

whats the alternative to the current situation… let the workforce kick back and relax on full pay for two years ?

on who’s dime ?

The UK railway network has criminally wasted billions the last 3 years. The binning of mk5’s is only only a cherry on the cake of waste.

Building more stock now, at high interest rates for an under performing network is a pointless tax payer burden.

 

This is the chickens coming home to roost on our post EU economy… we are out, European owners will look after their own interests before ours. Our labour laws make hiring and firing easy too. The manufacturers need to protect their own business.

I dont think this is the last announcement, and think another from up north is only a matter of time away.

 

The ROI on building new stock is only going to get higher, as we pay ourselves too much, inflate our economy and and protect the £ with high interest rates, that cover for an inefficient country with out of control debt interest.
 

Make do an mend is going to need to be the future. 

I dont think thats a bad thing either, weve squandered so much AC/DC stock for want of electrification, and still have more to join the pile.. 350’s soon joining 379’s. If putting up masts is cheaper than new stock, so be it.

Similarly Battery tech is really just a pipe dream for anything serious for at least a decade, so buying new DMUs makes no sense, nor does buying an inferior battery product… wait for the evolution.

 

its tough on those at Derby, but all of us at somepoint have been through a spot where their employer moved to protect their interests and put the employees on the street to pick themselves up and sort themselves out…. At least in this case they know it 2 years the horizon will change, a lot of people dont get that luxury and have to attempt a total change… I think their skills will be recognised, even if things maybe a little tougher for a few months, the jobs market is reasonable, at least for now.

Class 701 exams will becoming due soon.., some are approaching 5 years old already, despite having never entered service.

 

https://finance.yahoo.com/news/alstom-drops-another-22-equity-112301317.html
 

Quote

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.

Aventra is bringing down the business, I wouldnt be surprised if Derby was sold off, Hitachi being the obvious buyer, but that imo would only be a band aid until HS2 stock is done.

 

Quote

To stem cash burn, the French manufacturer has started a divestment program to raise as much as €1 billion, it said Wednesday. Alstom also plans to cut around 1,500 positions.
 

 

Derby isnt blameless in all this. The future of UK orders isnt great. Alsthom has never really held a foothold to the UK.

The employees have had a good ride through covid on the Aventra dime, but its hurt the employer.

Blaming the government is mis placed imo.

 

Its the usual story of British business.. it becomes too cosy on the domestic market and too cautious on the global market.. theres more to the world than Europe, we left it, their sales teams should be exploring the rest of the planet for business.

Edited November 16, 2023 by adb968008

[Ron Ron Ron]

28 minutes ago, adb968008 said:

……The UK railway network has criminally wasted billions the last 3 years. The binning of mk5’s is only only a cherry on the cake of waste.

Building more stock now, at high interest rates for an under performing network is a pointless tax payer burden…..

 

 

The tax payer isn’t paying for trains to be built.

They are all leased, not bought by the TOC’s or the  government.

Ownership lies with the ROSCO, or the manufacturers, through their own ROSCO vehicle.

Any public liability is with underwriting the contracts, or where subsidy to an operator includes cover for any increased leasing costs.

 

 

.

35 minutes ago, adb968008 said:

….This is the chickens coming home to roost on our post EU economy… we are out, European owners will look after their own interests before ours. Our labour laws make hiring and firing easy too. The manufacturers need to protect their own business.

I dont think this is the last announcement, and think another from up north is only a matter of time away….

 

In or out of the EU it doesn’t make a difference.

This is a similar scenario to 10 years ago or so, when there hadn’t been a passenger train order for……what was it, 1,000 days ?

Derby was faced with large job losses or even closure, with then owner Bombardier, threatening to close shop and concentrate its European manufacturing at just a couple of plants.

Being in the EU didn’t help there. It was badly needed train orders ( inc. large orders from LUL) that saved the day.

 

Unfortunately, the reality is that train building in the UK has been stuck in a “feast and famine” cycle since the mid- noughties.

Unless that cycle is broken somehow, the prospects don’t look good for places like Derby.

 

 

.

[jjb1970]

This has been the never ending saga for decades, and as Ron Ron Ron say's it has little to do with being in or out of the EU and everything to do with the local UK market.

[david.hill64]

2 hours ago, jjb1970 said:

This has been the never ending saga for decades, and as Ron Ron Ron say's it has little to do with being in or out of the EU and everything to do with the local UK market.

Agreed. Even when UK was in the EU, how many rolling stock orders were made in UK for EU customers? Issues with gauging are far more important.

 

At least Alstom has been trying to help by giving work such as Cairo monorail cars to Derby, but in the absence of domestic orders, things look grim. Remember too that Hitachi, Siemens and CAF have opened assembly plants in UK, so the Derby works has new competition.

 

We have of course been here before: I remember when Litchurch Lane was producing modular bathrooms for buildings in an attempt to keep staff on the books.

[papagolfjuliet]

16 hours ago, phil-b259 said:

 

Put it this way - if you are a train builder headquartered in France (and thus pay most of your tax to the French Government) then getting rid of French workers is going to cause a mighty stink - not least because those workers you get rid of can, through elections and thus changes in Government policy, make the business environment very difficult for the CEOs and top management of the organisation.

 

 

Also, the French have an approach to dealing with people who sack large numbers of workers which goes some way beyond lighting up the braziers.

 

http://news.bbc.co.uk/onthisday/hi/dates/stories/november/17/newsid_2540000/2540123.stm

 

 

[adb968008]

3 hours ago, david.hill64 said:

 

We have of course been here before: I remember when Litchurch Lane was producing modular bathrooms for buildings in an attempt to keep staff on the books.

This…

 

Why is everyone so insistent a manufacturing company should..

a. Be wholly reliant on UK rail orders

b. Be inflexible ?

c, blame the government for this.

 

Companies should be flexible and should be international looking.

 

we once exported railways to the world, if the argument is its now “too hard” in 2023, then maybe its time Derby did move to another industry, but man up, recognise it and adapt to survive.

 

Edited November 16, 2023 by adb968008

[adb968008]

7 hours ago, Ron Ron Ron said:

The tax payer isn’t paying for trains to be built.

They are all leased, not bought by the TOC’s or the  government.

Ownership lies with the ROSCO, or the manufacturers, through their own ROSCO vehicle.

Any public liability is with underwriting the contracts, or where subsidy to an operator includes cover for any increased leasing costs.

 

So at no point in the chain theres any government money in our railways?

the dft counts bags of profits all day and makes no decisions or influence over any part of the value chain ?

 

give over.

Theres hundreds of pages on here complaining of how the dft inspects the toilet rolls to ensure nothing is being spent without them knowing… it stems from here… if the dft doesnt approve it the toc doesnt spend, which means the roscos dont.

 

This in turn is why so much has been binned when the dft reigns in and cuts back.

 

 

7 hours ago, Ron Ron Ron said:

.

In or out of the EU it doesn’t make a difference.

 

in which country is Alsthom headquartered.

This will be a factor.

 

7 hours ago, Ron Ron Ron said:

This is a similar scenario to 10 years ago or so, when there hadn’t been a passenger train order for……what was it, 1,000 days ?

Derby was faced with large job losses or even closure, with then owner Bombardier, threatening to close shop and concentrate its European manufacturing at just a couple of plants.

Being in the EU didn’t help there. It was badly needed train orders ( inc. large orders from LUL) that saved the day.

 

its not about what you make, its who owns you… those decisions arent taken in Derby.

Alsthom is moving to protect itself, starting in its own backyard, not ours.

 

7 hours ago, Ron Ron Ron said:

 

Unfortunately, the reality is that train building in the UK has been stuck in a “feast and famine” cycle since the mid- noughties.

Unless that cycle is broken somehow, the prospects don’t look good for places like Derby.

.

And this is the failure.

idiocy is to do the same thing over and over and expect a different result.

The fault lies in the companies business planning and failure to diversify when it knows this is a cycle industry with down turns.

 

The country is struggling with battery tech, renewable energy etc, is Derby completely unable to look at emerging tech industries to diversify, Alstom, Bombardier arent just train makers afterall ?

I’m going to guess thats down to ownership and where those decisions are made, and who that tech benefits, and where the IP is made… none of that is in the UK, those decisions are made in the HQ of a competing market to ours…

 

Derby has always been a “special case” stemming back to the 1920’s and robbing work from Horwich, it was an issue even then, and ever since.
 

Edited November 16, 2023 by adb968008

[david.hill64]

But it's not 'Derby' in isolation. The works at Derby is a small part of the Alstom empire and history tells us that the French have form when it comes to merging/acquiring UK engineering companies and shipping the work to France. Think GEC and Chrysler for example. The chance of Alstom diverting work from France to UK is zero.

 

Bombardier was a Canadian company but it's worldwide headquarters was a brass plaque in the City of London so at least there was an argument that it might have supported UK jobs because of that. No chance with Alstom. But even Bombardier did rationalize the business in a vain attempt to stay afloat. 

 

I think from Derby's perspective it is a pity that the Bombardier-Siemens merger (takeover by Siemens didn't happen). There is then a chance that the TfL order might have gone to Derby even if the design would have been done in Germany.

 

But all of this ignores the fact that against the Chinese and the Koreans, western and Japanese companies are hopelessly uneconomic. 

 

If there is a large build of DMU's to replace the 15X fleet it will likely be CRCC that produces them. (At which point operators will long for the build quality of the CAF fleet).

 

 

[Ron Ron Ron]

36 minutes ago, david.hill64 said:

But it's not 'Derby' in isolation. The works at Derby is a small part of the Alstom empire……

 

………Bombardier was a Canadian company but its worldwide headquarters was a brass plaque in the City of London so at least there was an argument that it might have supported UK jobs because of that. No chance with Alstom. But even Bombardier did rationalize the business in a vain attempt to stay afloat. ……

 

Derby was a small part of Bombardier Transportation’s empire too.

The separate, worldwide transportation division of the company was headquartered in Berlin and in Europe alone, had manufacturing plants in 14 countries, with four factories in Germany alone.

(Note: The Voyager, Super Voyager and Meridians were built at their Belgian plant).

They inherited a European wide mess, when they took over ADtranz and sought to merge and close facilities in an attempt to sort it out.

Bombardier may have diversified to keep Litchurch Lane running, but there was an attempt to close the UK facility down, as part of their European rationalisation attempts, fulfilling any future UK orders from their German production lines.

 

Large orders for LUL stock, Aventra trains and the Elizabeth Line fleet, have been a stay of execution  for Derby.

Now the order well has run dry…..again !

 

 

 

.

[31A]

20 hours ago, Ron Ron Ron said:

How many old 2nd generation DMU’s and EMU’s are left that’ll need replacing in the next 5 to 10 years?

Basically, anything left from the BR era, which will be 30+ years old by now.

 

150, 153, 155, 156, 158, 159, 319, 321/2/3  etc ?

 

There will be a need to start replacing more modern, 3rd gen, post privatisation trains in the 2030’s and 40’s.

What remains of domestic train building capacity may be gone by then.

 

 

.

 

 

These are going to be built somewhere; as far as I know it hasn't yet been decided where:

 

https://www.modernrailways.com/article/northern-plots-new-train-order

 

Edited November 16, 2023 by 31A

[david.hill64]

5 minutes ago, Ron Ron Ron said:

Derby was a small part of Bombardier Transportation’s empire too.

The separate, worldwide transportation division of the company was headquartered in Berlin and in Europe alone, had manufacturing plants in 14 countries, with four factories in Germany alone.

Agreed, Derby was also a small part of the Bombardier Empire.

 

When I worked for Bombardier (2013 - 2019) there was an internal notice about the company registration moving to UK. While the operational HQ was in Berlin, for tax purposes Bombardier Transportation became a UK company and paid its corporation taxes in UK.

[jjb1970]

The big European (OK, Bombardier was Canadian, but their rail vehicle manufacturing division was pretty much European) have been looking over their shoulders at China for years. So far China has had limited penetration of Europe but they're building their global presence and their products seem to be improving. I remember people used to laugh at Chinese built ships and a time when Chinese builders competed on low price, now while you get what you pay for the good Chinese builders match the best on design, innovation and quality. I'm guessing there'll be a similar evolution with trains. A few years ago the company behind one of the open access operators was interested in collaborating with CRRC for the UK market but it didn't come to anything.

[phil-b259]

2 hours ago, adb968008 said:

This…

 

Why is everyone so insistent a manufacturing company should..

a. Be wholly reliant on UK rail orders

b. Be inflexible ?

c, blame the government for this.

 

 

 

Because when you look at the manufacturing sector more widely, history shows that the as far as multinationals go, the U.K. is far more likely to be hot with job losss and plant closures than places elsewhere in the world due to the way other Governments are either closely involved in said company’s cooperate ownership or are not afraid to intervene and frustrate ‘the power of the free market’ to that country’s advantage.

 

Alstom is a very good case in point - The French Government are very well aware of how sackings and plant closures would go down with the electorate so make every effort to keep French plants in work - be that chucking them orders for a few more TGVs regardless whether they are really needed or ‘suggesting’ to the Alstom board they look overseas for the necessary savings.

[adb968008]

1 hour ago, phil-b259 said:

Because when you look at the manufacturing sector more widely, history shows that the as far as multinationals go, the U.K. is far more likely to be hot with job losss and plant closures than places elsewhere in the world due to the way other Governments are either closely involved in said company’s cooperate ownership or are not afraid to intervene and frustrate ‘the power of the free market’ to that country’s advantage.

 

Alstom is a very good case in point - The French Government are very well aware of how sackings and plant closures would go down with the electorate so make every effort to keep French plants in work - be that chucking them orders for a few more TGVs regardless whether they are really needed or ‘suggesting’ to the Alstom board they look overseas for the necessary savings.

The obvious question is, why dont we have an UK owned enterprises in the manufacturing sector…

 

Well we do in several sectors, but less so in railways…

Why…?

 

Quote

a. Be wholly reliant on UK rail orders

b. Be inflexible ?

c, blame the government for this.

hence they ended up foreign owned.

now the foreign owners are learning why they were able to buy British companies so cheaply.

 

its a vicious circle.

 

Derby has simply run itself dry, in the big scheme of things its a short term issues, two years time the HS2 stock order comes.

 

But they failed to manage pipeline, despite being a general global shortage of manufacturing skills and at a time prices are inflating because of high demand and shortage of said skills. The workers should be able to pick up other jobs (is Clayton hiring for that Beacon class 18 order ?), but its a sign of weak commitment to Derby by its owners, I suspect in part due to Aventra.
 

 

Edited November 16, 2023 by adb968008

[Ron Ron Ron]

57 minutes ago, phil-b259 said:

Because when you look at the manufacturing sector more widely, history shows that the as far as multinationals go, the U.K. is far more likely to be hot with job losss and plant closures than places elsewhere in the world due to the way other Governments are either closely involved in said company’s cooperate ownership or are not afraid to intervene and frustrate ‘the power of the free market’ to that country’s advantage.

 

Alstom is a very good case in point - The French Government are very well aware of how sackings and plant closures would go down with the electorate so make every effort to keep French plants in work - be that chucking them orders for a few more TGVs regardless whether they are really needed or ‘suggesting’ to the Alstom board they look overseas for the necessary savings.

Despite the opposition and political fuss created in France, when it comes to losing jobs, there have been lots of manufacturing closures in France over recent years, some of them high profile and controversial.

e.g. Ford made thousands redundant, Renault closed plants, domestic appliance manufacturers gone ..…even the last Meccano factory closing.

They appear to only want to protect, what might be considered, strategic businesses.

The French national deficit is over €3 trillion with an unemployment rate of 7.4% (UK is 4.2%).

They are going bust, just like us.

 

 

.

[spamcan61]

11 minutes ago, Ron Ron Ron said:

Despite the opposition and political fuss created in France, when it comes to losing jobs, there have been lots of manufacturing closures in France over recent years, some of them high profile and controversial.

e.g. Ford made thousands redundant, Renault closed plants, domestic appliance manufacturers gone ..…even the last Meccano factory closing.

They appear to only want to protect, what might be considered, strategic businesses.

The French national deficit is over €3 trillion with an unemployment rate of 7.4% (UK is 4.2%).

They are going bust, just like us.

 

 

.

I seem to recall that when Sony shut down their French operation the workers held the senior management hostage for several days.

 

Slight exaggeration, here's the story, one manager overnight:-

 

https://www.theguardian.com/world/2009/mar/13/sony-france-boss-hostage

 

Edited November 16, 2023 by spamcan61

[GMKAT7]

Good afternoon folks,

 

At the beginning of 2020 I was part of an engineering team parachuted into Bombardier to support the assurance, and thus client acceptance, of an Aventra fleet then being produced at Derby.

 

As 'blood-sucking ' consultancy staff we were brought in to provide the engineering expertise that Bombardier couldn't resource in-house.

Some eight months later our contract expired and we moved on again. With this work and support on ETCS our company dragged in c£1m in fees.

 

As I understand it from other threads on here, that fleet is still not in full revenue service, so presumably there are contract penalties in place that will impact now on Alstom.

 

One of the permanent Derby staff confided that each Aventra vehicle cost more to produce than the contract sale price. And this figure was not tens of pounds but something with more noughts after it.

 

So, something was off three years ago and seems to be coming home now.

Doesn't help the poor souls there facing unemployment.

 

Cheers, Nigel.