Bombardier: 1,400 Derby jobs are gone four months after PM’s pledge to help

Last remaining train maker in UK halves its workforce and calls on government for rethink after losing £3bn contract Four months ago David Cameron brought his “march of the makers” to Derby in a morale-boosting exercise for Britain’s blue-collar sector. Now more than 1,400 manufacturing jobs have walked out of the city as Bombardier, the last remaining train maker in the UK, announced plans to cut nearly half its workforce in the wake of the government’s decision last month to select Siemens of Germany for a £3bn contract. Trade union leaders and local politicians rounded on the prime minister, who had brought his cabinet to Derby amid talk of weaning the economy off financial services and pledging to “do everything we can” to help local businesses create jobs. The criticism was particularly stinging from Bombardier employees and executives, who are cutting 1,429 staff, comprised of 446 full-time workers and 983 agency employees. The Canadian engineering group said it needed the £3bn Thameslink contract to have a hope of retaining the bulk of its 3,000-strong workforce at the former British Rail factory in central Derby, which survived a zeppelin bombing in 1916 but according to the government has fallen foul of a new continental menace: European Union procurement rules. Ministers believe their hands were tied by Brussels guidelines that forbid favourable treatment of domestic manufacturers. Standing in front of freshly minted commuter trains at the 172 year-old plant, one Bombardier executive was scornful of the cabinet visit and its immediate legacy. “What makes it most inexplicable for me is David Cameron being in Derby of all places a few months ago talking about hi-tech manufacturing and moving the UK away from financial services in London,” said Francis Paonessa, head of Bombardier’s UK passenger division. “This would have been the perfect opportunity to put some actions behind those words. As a taxpayer I find it very difficult to see how this decision makes any economic sense for the UK.” Paonessa added that the Department for Business, Innovation and Skills had invited Bombardier to a conference on transferring hi-tech jobs at risk in the wake of the defence budget cuts to other sectors such as car and train manufacturing. “We are now adding to the problem,” said Paonessa. Asked if he still plans to attend the BIS seminar he said: “Funnily enough, I will not.” Bombardier’s UK chairman, Colin Walton, said the jobs announcement was “the worst day in my entire career.” Walton started out on the railways as a 15-year-old but last week closed the door on youngsters seeking to emulate him when he was forced to cancel Bombardier’s annual apprenticeship intake. Despite government claims that Siemens could not be unseated as preferred bidder for the Thameslink contract, the executive said there was still hope for Bombardier as the second choice. “The department could bring us back to the table and that would in no way infringe on European laws.” Labour’s shadow business secretary, John Denham, also urged the government to break off with Siemens and install Bombardier as preferred bidder. The transport secretary, Philip Hammond, said his department had no choice but to select Siemens in a tender drawn up by the previous government. Vince Cable, the business secretary, set up an “economic response task force” on Tuesday to mitigate the impact of the job cuts in Derby, as the government hit back against Bombardier’s claim that the cuts were directly linked to the Thameslink contract. They pointed to a recent letter to Hammond in which Bombardier warned that 1,200 jobs were at risk even if the company did not win the order. Industry sources said the company would have had to scale back as orders began to deplete. From September four of Bombardier’s five production lines, still thrumming with activity, will be idle. Bombardier said that it would not have axed permanent staff, while securing the £3bn deal would have put the business in pole position to make rolling stock for the £16bn Crossrail route. The talk among shell-shocked staff in Derby was of a full plant closure. Bombardier is reviewing its UK operations in the wake of the Thameslink decision and it has not ruled out closing Derby by 2014, when its last contract ends. Paul Stead, 49, a Derby resident who oversees production of nearly 1,400 tube carriages, said: “This is the last of the train manufacturing sites in the UK and it will probably be dissolved. There are no orders. The whole principle of Thameslink is it would have lasted us until Crossrail. A place of this size needs a big order.” He added: “We are prepared to take the skills into another country and pay them to do it instead of doing it here. Our apprentices and trades people will be obsolete.” Siemens has confirmed that the carriages will be made in Germany, but has claimed that 2,000 jobs will be created in the UK. Asked what will become of the Derby plant, Stead said: “Most likely they will put houses on it,” adding that the Royal Ordnance Factory site in Derby where he used to work is now a B&Q store. Others spoke glumly of re-employment prospects. The head of the factory’s works committee, John Pearson, said Derby’s flagship industrial player, Rolls Royce, would struggle to absorb more than 1,000 jobless workers, while internet bank Egg is preparing to cut 650 posts in the City. “Derby has had a bad time lately. There is Royce’s but it will not be able to take everybody.” Jane Moss, a 35 year-old agency worker who has been doing fitting work at the plant, said: “It is a bit frightening because there is not much in industry in England anyway. It is just dwindling away.” Bombardier Job losses Transport policy Manufacturing sector Rail transport Transport Dan Milmo guardian.co.uk

Posted by on July 5, 2011. Filed under News, Politics, World News. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.