Britain's last remaining train factory, Bombardier, has bagged a £188 million contract to build 130 new rail carriages, which comes as a lifeline for the plant in Derby whose future remains uncertain with over 1,400 jobs expected to be axed.
The blow came after the government chose German manufacturer Siemens as the preferred bidder for a £1.4 billion Thameslink trains contract this year. (See also: UK unions oppose Siemen's selection for Crossrail project)
However, the Department for Transport, in a bid to keep the 172-year-old former British Rail factory going, is working overtime to find contracts for the plant and yesterday announced a deal for Bombardier to build 130 carriages for the Southern franchise.
The transport secretary, Justine Greening, said the deal for more than 100 new carriages was great news for rail passengers and brilliant news for Bombardier and Derby. It landed Bombardier with a crucial train order and she looked forward to Bombardier workers in Derby being among the winners of the important deal, she added.
Although the contract had been awarded by the Southern rail franchise, it was supported by a payment of £80 million from the transport department.
Production of the carriages is set to begin in the second half of next year, although the deal is not a like-for-like replacement for the Thameslink contract. The 1,200 carriages for the Thameslink route were seen as pivotal for the long-term future of 3,000 jobs at Derby because, even with the Southern contract, the plant would be left with no more work once a contract with London Underground expired in 2014.
Last week, Greening said she was "enthusiastic" about giving the company a £120 million contract to build new carriages for the CrossCountry franchise, though she had not yet to given the contract, the full go-ahead.