Canada-based Bombardier lost out on the £1.4bn contract to German engineer Siemens in June, leaving its Derby factory hanging in the balance.
But a new Department for Transport (DfT) contract to upgrade a fleet of 57 trains to run on overhead electrical power could save the factory and provide a shot in the arm for the struggling company.
Bombardier is the DfT’s first choice for the contract, with sources saying the department is desperate to prevent a brain-drain of engineering talent at the company. It is at an advantage over the competition as the trains to be upgraded were produced by Bombardier. However, the source added the process is at a “very, very early stage” and there is no guarantee it will be handed to Bombardier. The DfT is looking into whether the contract must be put out to tender under EU competition law.
A report from the DfT said: “We anticipate that, if it proceeds, this work would be delivered largely from within the industry’s UK operations and will safeguard jobs at the Bombardier works, including their design team and with the company’s supply chain.”
The contract could be worth around £120m. The DfT says it hopes the upgrade could save in fuel costs and increase its capacity. It will now begin a study into whether the project is “technically feasible” and would provide value for money.