Buying British

New train orders are like buses and Tour de France victories. Nothing for ages and then two come along at once.

In the case of train orders, the two are the Thameslink order for 1,140 carriages awarded to Siemens, and a second tranche of 30 nine-car IEP electric trains (270 carriages) from Hitachi for the East Coast main line. This follows on from a mixed order for 92 electric and bimodal IEP trains (596 carriages) that was placed last summer.

But they are foreign

Both orders caused somewhat of a furore amongst the ‘build it in Britain’ lobby, which cited the fact that the trains could have been built by Bombardier in Derby.  In fact, Hitachi will indeed build the trains in the North East, at Newton Aycliffe in County Durham, although there was concern about just how much local content they will have.  The Siemens trains will be built at the Krefeld factory in Germany where the other Siemens fleets already in operation in the UK were manufactured.

Local content is naturally an emotive political issue.  It must be said that the third option, Bombardier’s Derby factory, would not have used exclusively UK components. Recent production has used German bogies, Swedish traction equipment, French seats and even South African glass. Train manufacture is a global business these days, and no truly national manufacturers exist any more.

That said, the UK taxpayer would like to think that at least some of the money will go to buy British products and support British jobs. It is also on Vince Cable’s mind, the Secretary of State for Business, Innovation and Skills.  After all, it is his job to promote British business.

The Rail Engineer caught up with him when he opened Vital Services Group’s new training centre in Manchester recently. This new academy, which will offer Apprenticeships and commercial training in rail, power and technology, features ICT suites, gas and electricity metering rooms and multiple break-out areas and has the capacity to support up to 258 trainees at any one time.

British supply chain

“My department is trying to build up a British supply chain,” Dr. Cable explained exclusively to this magazine. “And so we’ve got to talk to the industry. I jointly chair a roundtable with Patrick McLoughlin (Secretary of State for Transport) and we get all the industry people together, including the Head of Crossrail, Siemens, Bombardier as well as other traditional established rail companies and manufacturers.

“We do see it as an industry which is expanding.  I mean I grew up with Beeching and all that stuff and you thought the rail industry has been an industry in decline, but there’s now massive investment, going into electrification, Crossrail, Thameslink, and eventually HS2 so we’re back to British manufacturing with the factory in the North East when Hitachi get going and a lot of spin offs.”

But doesn’t the fact that the new factory is in foreign ownership concern him?

“I don’t have a hang up about foreign ownership.  If you look at the big companies which dominate British industry, and they’re actually making a massive contribution to the economy, you’ve got companies like Jaguar Land Rover which is owned by an Indian company Tata, and they take a very long term and very positive view of the UK and they’re investing very heavily here. Nissan – they’ve helped us produce one of the world’s leading car factories which is exporting more cars than any other British car plant has ever done, so I’m the last person to object to foreign owners and I think the idea of ownership is a bit blurred.

“Siemens are of course German but they do a lot of things in the UK, not just in railways. Bombardier, who were being championed as the British company are actually Canadian, though they’re a good company and they do other things in aerospace as well as rail, so I think the foreign ownership issue is a red herring.”

Pushing for UK content

Dr Cable naturally wants to see a large British content if possible. “Actually Siemens originated in Britain a century ago,” he said. .”They then went to Germany and now they’re coming back, but they do lots of stuff in a variety of industries and they are committed to the UK.  I’m hoping we’re going to get them assembling wind turbines and things for the North Sea amongst other things, but there will be a lot of UK content in their project and I want to maximise that.

“Until quite recently, until we got our so-called industrial strategy developed, the Governments were a bit negligent on that front.  A lot of supply chain just disappeared overseas.  There were some real horror stories in the North Sea, where you get these big platforms being established and almost all of it is made abroad, so I now call the companies in and I say ‘well why aren’t you using British contractors and British equipment’?

“You can’t do it on a protectionist basis, and if our company’s can’t compete on price and quality well obviously they’ve got to make their commercial decisions, but for some years I don’t think this issue was even thought about and it should have been, and I certainly don’t hesitate to push very hard for UK content.”

He promotes British content abroad as well. “One of my titles is President of the Board of Trade. I don’t use it very often, it sounds a bit grand, but I am President of the Board of Trade and it is part of my job to promote exports and I do that.  I was in Singapore, I promoted British companies trying to get in on the big Singapore rail contracts. A lot of our specialist engineering companies are very good at that, systems design, specialist engineering services, consultancy and the rest of it, and I would hope that, in the course of time, manufacturing, key assembly units and so on, will be part of the British offer.”

So the Government is obviously pushing both Siemens and Hitachi to ‘Buy British’, and it seems to be paying off. Both Siemens and Hitachi have released graphics showing which components on their new trains will be purchased in the UK.  And their will be more to come. Hitachi certainly hasn’t yet let all of its contracts and the interiors still seem to be up for grabs.

Companies such as Unipart Rail and Brecknell Willis appear on both lists, reflecting their strong international positions.  But there are others mentioned, some the UK factories of foreign companies, which are themselves employing British workers and producing a British product.

It is, of course, early days yet. It will be interesting to calculate the UK content of each train once they are in full production. But the Government, and the companies themselves, all seem bent on making that percentage as high as possible.