MONTREAL – Bombardier’s railway division has won a $1.7-billion order to build 660 railway cars that will secure 1,000 jobs at its Derby facility in England.
Britain’s Department for Transport said the contract, awarded by government-selected railway operator Abellio, is part of a broader $2.4-billion effort to improve rail service in the region of East Anglia.
“We are making the biggest investment in the railways since the Victorian era,” stated British Transport Secretary Chris Grayling in a news release.
Grayling said Abellio’s decision ensures Britain’s train-building industry in Derby remains strong.
As Britain’s last remaining railway manufacturing plant, acquired by Bombardier 15 years ago, the Derby facility has been under threat since German rival Siemens beat out the Montreal-based transportation company in 2011 to upgrade London’s Thameslink network.
Bombardier (TSX:BBD.B) cut more than 1,400 U.K. rail jobs after it failed to secure that order.
Nearly 270 mainly temporary positions in Britain were also to be affected, as part of a company-wide restructuring announced in February to trim 7,000 aerospace and railway positions around the world.
But Bombardier said the order for the 660 electric Aventra railway cars will sustain 1,000 assembly, engineering and other jobs at the Derby facility for the duration of the contract, which should be finalized in the next few weeks.
“This contract will provide a stable, long-term workload for our staff, as well as supporting many jobs in the wider U.K. rail supply chain,” said company spokesman Marc-Andre Lefebvre.
The faster Aventra trains are expected to cut journey times by an average of 10 per cent, and will hold more seats and offer free Wi-Fi to all passengers.
“This announcement is a true endorsement of our workforce and the quality of the products they design, engineer and manufacture in the U.K.,” said Lefebvre.
Swiss manufacturer Stadler Rail will provide the remaining 383 cars in the 1,043 order awarded by Abellio.
Delivery of the new carriages will begin in January 2019. Bombardier declined to say if it will also refurbish the existing railway cars before the new ones enter service.
The Abellio contract, designated for one of the busiest commuter networks going into London, was awarded despite speculation in Britain that it could be delayed over uncertainty about the fallout from the U.K. referendum.
The contract follows a scathing London Assembly committee report in March that accused Bombardier of “duping” London Transit about its ability to complete a $670-million signalling project awarded in 2011.
Bombardier, which has disputed those findings, said the work is completely unrelated to the new contract.
“These are two different projects altogether,” said Lefebvre.
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