Welcome To Zelo Street!

This is a blog of liberal stance and independent mind

Monday, 24 October 2011

Bombardier – The Penny Drops

Campaigners, among them MPs, trade unionists, councillors, business people, and the obligatory convocation of hacks, have recently rallied to the cause of those working at Bombardier Transportation’s Derby plant, the UK’s last railway rolling stock manufacturing facility. The belief is that, somehow, the process by which the company lost out on the Thameslink bid to Siemens was flawed or biased.

Moreover, the further beliefs hold that the Thameslink bid could be re-opened, and that Bombardier would love to carry on building trains in Derby, if only the Government would interpret EU competition rules the way that the French and Germans do. But I have consistently warned that Bombardier has previous when it comes to closing down and asset-stripping facilities.

Thus far, decision makers and opinion formers have failed to see the signs coming from Bombardier: the loss of interest in repair work at Crewe, followed by closure of the repair facility and equipment removal, has been largely ignored. The loss of interest in refurbishment work at Derby, a significant potential source of work in tough economic times, has likewise passed unnoticed.

And little attention has been paid to Bombardier’s record of buying up, exploiting, and then closing down production facilities in Berlin, across Switzerland, and in Portugal. But the people at Rail Business Intelligence have picked up on the company’s dwindling interest in the Derby plant, as those receiving Roger Ford’s latest Informed Sources e-Preview today have seen.

Talk that [train operator] Southern could order some more Class 377 Electrostars [multiple unit trains] from Bombardier to ease the heat over Derbygate was confirmed on 16 September” notes Roger. The order will be for 130 vehicles formed into 26 five coach sets. This would keep the Derby production line occupied for more than six months.

However, “according to Informed Sources, Bombardier has been trying to sell Southern the more expensive Greater Anglia Class 379 design, rather than manufacture what its major customer needs – some more of the simpler Class 377. Of course this will involve extra effort from Bombardier and its supply chain to switch back to the earlier build”.

But if Bombardier were serious about keeping Derby open [my emphasis], you might expect them to be accommodating, especially since Southern could be in the market for over 350 Class 377 vehicles in the longer term”. Elsewhere in the email, Roger concludes that “for the foreseeable future, the railways in the UK are unlikely to generate enough orders to support even a single factory”.

There now follows the sound of pennies dropping. I told you so.

1 comment:

John Ruddy said...

Yes, I read that in Roger's email and I was surprised. Surely the company should be trying to give the customer what he wants?

Thats sort of inefficiency is usually only seen in the public sector!