German-owned DB Cargo has announced plans to cut up to 900 jobs due to "rapid and unprecedented changes" in the markets it operates in.
The firm is proposing a potential reduction of its workforce by 893 roles across the business and a downsizing of its locomotive and wagon fleet, as well as a revision of the number of its depots.
The company blamed a sharp fall in demand for transporting goods, such as coal and steel. Between January and September it recorded a 78 per cent reduction in the number of coal trains it ran and a drop of 33 per cent in the number of steel trains.
The rail freight firm has its UK headquarters in Doncaster, South Yorkshire and is the UK's largest rail freight hauler. It employs around 3,400 people across the country.
UK chief executive Hans-Georg Werner said: "Whilst this is a difficult time for all of us at DB Cargo UK, reshaping the company will enable us to build a business for the future and protect the majority of jobs. We are fully committed to supporting colleagues who may be at risk of redundancy."
Mick Whelan, general secretary of Aslef, the Associated Society of Locomotive Engineers and Firemen, said: "Freight on rail is collapsing in this country." He said the DB Cargo news was "an individual tragedy for each man and woman who loses a job and a collective tragedy for our rail industry".
Whelan said the company had been "extraordinarily slow" to adapt to changing conditions.
Mick Cash, general secretary of the Rail, Maritime and Transport Union (RMT) said: "This is devastating news brought on through a combination of cut-throat practices in the UK rail freight industry and a shocking lack of government support for this key section of our transport infrastructure."
The union will meet to consider its response.