Derby-based Bombardier has been given a reprieve by securing a contract to build 130 new Electrostar train carriages to be put into use by rail operator Southern. The Canadian company had said that it was going to have to make half of its staff redundant after it lost out on the bid to build Thameslink 1,200 carriages to Germanys Siemens.
Currently, none of the full-time employees at the Derby plant have been made redundant, but there have been job losses at some of the firms contractors. The governments decision to give Siemens the job of producing the Thameslink rolling stock resulted in widespread condemnation.
Bob Crow, of the RMT union, said the government had effectively destroyed train manufacturing in the UK. The row forced ministers to revise the process of awarding contracts. However, the government denies that the Southern contract has anything to do with the Thameslink decision, and will supply a subsidy of 80 million.
The Department for Transport said that this money would be paid back through increased operating premiums charged to Southern in return for permission to operate the railway. A DfT spokesman said that the subsidy would have been made available to whoever won the contract.
Justine Greening, Transport Secretary, said she was extremely pleased that the Southern project had been won by Bombardier. She added that it was the result of hard work by her department and proved that she was committed to making sure that Britains railways received the necessary support and funding that they deserve.