More than 1,300 jobs are at risk at Britain’s biggest rail assembly plant as the order book shrank due to HS2 setbacks.
French train company Alstom has notified staff at the Litchurch Lane train manufacturer in Derby that consultations on job cuts are to begin and redundancies may be made.
The order book has dried up after the first three months of next year, although work on the HS2 high-speed rail project is due to start in 2026.
The government’s scheme has been plagued by delays with a knock-on effect for contractors.
As many as 550 permanent and 780 temporary positions at Alstom could be cut as a result. A further 700 Alstom employees work in the engineering and global design unit at Litchurch Lane.
Work on trains has taken place at the site since the Victorian era. Recently, trains were built for the new Elizabeth Line across London, formerly known as the Crossrail project.
Alstom’s half-year results were published on Wednesday, with the company warning of 1,500 job losses globally.
Share price falls over the year have meant around £3.62bn has been wiped from the firm’s market value in 2023.
Discussions with the government took place over six months in an attempt to secure a future for the factory, but no way forward was found, the company said.
A “significant reduction in activity” is planned.
“We remain open to the future of non-manufacturing functions located at Litchurch Lane and to potential future alternative uses for the Derby site,” Alstom added.
“We will begin a comprehensive review of options and will fully engage our stakeholders in this process.”
A Department for Transport spokesman said: “Rail manufacturing is an important part of the UK economy and we will work closely with Alstom as it continues to deliver its contractual obligations, as we do with all rolling stock manufacturers.
“While this is a commercial matter for the company, we have already set up a dedicated cross-government taskforce to properly support workers at Alstom during what will be a worrying time.”
Less than three years ago, Alstom bought the company from the Canadian company Bombardier Transportation.
Alstom is perhaps best known for its construction of the French TGV trains.
Last month, Channel Tunnel operator Evolyn announced it would buy 12 Alstom trains to provide a Eurostar alternative.