The world’s largest train manufacturer, Bombardier, said it will eliminate 1,400 jobs at its plant in Derby in the north of England.
Based in Canada, the company’s UK subsidiary will cut 446 permanent jobs and 983 temporary contract workers.
The British unit currently employs a total of 3,000 people in Derby.
The company recently failed to land the £1.4-billion contract to build train carriages for the Thameslink system which will run a route from Bedford to Brighton. The German firm Siemens landed that plum deal from the British government.
The… loss of the Thameslink contract, which would have secured workload at this site [Derby], means that it is inevitable that we must adjust capacity in line with economic reality, said Francis Paonessa, president of the passengers division for Bombardier in the UK.
We regret this outcome but without new orders we cannot maintain the current level of employment and activity at Derby.
Outraged British union leaders and opposition lawmakers have asked the government to reconsider its decision to select Siemens.
The RMT rail union said the Siemens contract was tantamount to an act of “industrial vandalism that would wipe out train building in the nation that gave the railways to the world.”
“The dire consequences of the misguided decision to exclude Bombardier from the contract are now becoming a reality,”
Unite union General Secretary Len McCluskey said in a statement. “The government must now act swiftly and decisively to save Britain’s last train manufacturer.”
The procurement process of handing out contracts has also been questioned.
I don't know of any [EU] procurement that's been in France or Germany that has gone to any other company other than the indigenous rail manufacturers in their countries, said Mark Young, an official with Britain’s Unite union.
So if they're playing by the same rules that we are, or at least we're professing to play by the same rules, then something else has gone wrong and it's no good the government saying they can't do anything about it. Yes they can and yes they must.
Shadow business secretary John Denham and shadow transport secretary Maria Eagle have pleaded with Prime Minister David Cameron to review the decision on granting the contract to Siemens.
On the bright side, Siemens said it will create about 2,000 jobs across Britain as a result of securing the Thameslink contract. However, since Siemens will manufacture the trains in Germany, only about 300 of its new jobs in the UK will be directly related to the Thameslink deal.
Siemens already has about 16,000 employees in the UK.