Train manufacturers at a critical juncture

There’s a key question looming for Britain over its rolling stock industry: does Britain want to produce its own trains?

That means designing as well as building them, with building more than simply assembling major components brought in from abroad.

Nick Crossfield runs Alstom in the UK, including its factory at Derby. He told the Transport Select Committee last December: “I could convert Derby from a site that employs 3,000 people, supports about 15,000 people outside, and spends £1.4 billion (as a rough order of magnitude) in the local supply chain to a facility employing 300 people, importing major sub-systems and structures from abroad. We would final-assemble them in Derby, test them, and supply them to the market.

“That is a very easy transition to make. It is not one that I want to make, and it is not one that I believe the company should make.”

Alstom at Derby spends 70% within Britain and 30% abroad. That would radically change if Derby shrinks to become merely a production facility.

Crossfield told MPs: “We will take our wiring loom from North Africa. We will take our body panels, which will come in pre-pressed and ready, from China. We will take frames from central and eastern Europe. It is a very different supply chain. Once you lose it, guys, you don’t get it back. You do not get it back.”

Derby would have lost the 450 well-paid and highly skilled engineers whose work, Crossfield argues, is split 50:50 between work for British stock and work that’s exported.

For many, it doesn’t matter where a new train comes from, provided it’s reliable and satisfies passengers. Passengers riding today’s Avanti West Coast Class 390s will not know or care whether they’re from Savigliano in Italy or Washwood Heath in Birmingham

As it happens, Washwood Heath was part of Alstom.

It closed once it finished the West Coast Pendolino order over 20 years ago, with no other work to do.

Now Derby faces the same threat, as its production lines witness the end of Aventra production which has entailed them building 2,500 vehicles across five train operators - chiefly the Elizabeth line with Class 345s, but also Greater Anglia, South Western Railway, West Midlands Railway and c2c.

Winning the Elizabeth line order back in 2014 was a lifeline for Derby.

The plant had faced the prospect of closure when London’s other major commuter stock order went to Siemens in 2010.

This was the order for Thameslink that resulted in 60 eight-car and 15 12-car trains being built as Class 700s.

Siemens builds its stock abroad, but it is now creating a factory at Goole to deliver an order of Piccadilly Line trains for London Underground.

It said in mid-February that Goole’s share of this order was to rise from around half of the 94 trains to up to 79.

Of course, Siemens is not building production facilities at Goole for just 79 trains. It hopes to follow its Piccadilly production with stock to replace the Bakerloo Line’s 50-year-old trains, and then the Central Line’s.

But there is no guarantee that either order will come because Transport for London relies on central UK government funding for major projects such as rolling stock replacement.

And for now, the government is sitting on its hands. That’s even amid pressure to order more Class 345 units for the Elizabeth line to increase capacity into central London from Old Oak Common, where the same government seems keen that High Speed 2 terminates with limited onward links. Linger too long over this decision and there will be no Aventra production line on which to build these trains.

Linking rolling stock orders to new factories has recently become fashionable - in part because of complaints that major orders, such as those Siemens Class 700s, were delivered from abroad.

Hitachi was the first to pledge a factory when it won the Department for Transport’s Intercity Express Programme rolling stock order back in 2012.

Its Newton Aycliffe site remains busy. Having built those IEP units for LNER and GWR, it won follow-on orders for GWR, TransPennine Express, Avanti West Coast and Lumo. It’s currently building a version for East Midlands Railway.

Whether there is more work beyond that remains an unanswered question.

Likewise CAF, with its Newport facility that has been supplying ‘19x’ diesel multiple units - most recently Class 196s to West Midlands and Class 197s to Transport for Wales.

CAF also has an order for ten ten-car trains for LNER, for diesel trains. It could be operated as a standalone line with captive rolling stock, making it an ideal showcase had the DfT (Northern’s owner) wished.

Hitachi is also entering the battery hybrid game. It’s replacing one of the diesel engines under TransPennine Express 802207 with a battery raft.

This ‘802’ was already a bi-mode (electric and diesel), so the trial takes it into bi-mode territory.

TPE Fleet, Safety and Service Director Paul Staples hopes the trial will show how batteries work with high-speed services, while also eliminating exhaust fumes in stations. The trial is set to start next August.

Observers may also be interested in seeing how the ‘802’ bridges the 15-mile electrification gap between Church Fenton and Neville Hill, Leeds.

This need to test and perfect rail traction batteries suggests there’s decent work for Crossfield’s engineers in Derby and those at other manufacturers.

But it doesn’t suggest that there will be work at scale down on the assembly floor very soon.

As Crossfield told those MPs last December: “As an OEM supplying into the market, I would characterise it short term as very challenging. In the next two to three years, it will be hugely challenging. Medium to long term, it is quite an attractive market.

“Particularly in the longer term - from, say, 2027-28 onwards - the UK market for rolling stock is predicted to be the second largest in Europe.

Drilling down even further, the market for commuter rail in the UK from 2027-28 onwards is probably the fastest-growing market in the European geography. Medium to long term, there are good prospects and high potential, but the short term is hugely challenging.”

But he wasn’t impressed with Britain’s progress in areas such as decarbonisation. The battery trials mentioned above involve (or have involved) little more than a handful of trains. They have largely been developed from the bottom up.

Indeed, Hitachi’s trial with 802207 uses a unit that TPE has not had available for service since March 2022, when it was damaged in a derailment in Heaton Depot.

Crossfield noted: “The other grave concern that I have about the UK market for rolling stock is that not just in volume, but in technology, this country is way off pace in terms of decarbonisation.

“In most of the major developed rolling stock markets in the spaces around Europe, and around the world, where most of the major OEMs operate, decarbonisation is accelerating at a pace that we do not see in this country. If we are to build a capability here and not be a net importer of that technology in future, we need to accelerate our efforts to introduce new technologies.”

Clarke, Crossfield and a third witness - Angel Trains Chief Executive Malcolm Brown - were speaking ahead of the DfT’s publication of a ‘road map for procurement’ that Transport Secretary Mark Harper had mentioned at an earlier Transport Committee meeting. Harper had said it would “provide certainty about what work is coming down the road” and be published by the end of 2023.

While Clarke said he was waiting with “bated breath” to see what that road map might look like, he also explained what RIA might want to see, drawing on its report from last summer’s.

“In our earlier report we postulated an approach that would bring out an opportunity to reduce the cost of running the railway,” he said.

“We have experienced boom and bust. In any industry, if you have a boom and bust of demand it tends to lead to inefficiency, and therefore higher cost.

"We postulated that if we had a smoother order book profile, you would see a reduction in cost.

“To prove to ourselves that you actually could have a smoother order book profile, we went through it and said: ‘Well, what would we do if we were the guiding mind?’

“What you do is take away a peak that would otherwise repeat itself in roughly a 35-year cycle. You look at that peak and bring some forward.

“They might be the diesels, for example, that you ultimately want to replace. You bring them forward and get benefits sooner, and you push some further back, maybe by some refurbishment. In that way you lop the peak, as they say.”

What came from Rail Minister Huw Merriman on January 31 fell short of this. Merriman wrote: “Despite the challenging conditions we continue to face, new competitions are now under way to replace trains on Northern, TransPennine, Southeastern and Chiltern, subject to business case approval.

“There are also several major fleet upgrades under way, including an upgrade of GTR’s Electrostar fleets, a planned refurbishment of the CrossCountry Voyager fleet, and a major refurbishment of the Pendolino fleet which is being carried out by Alstom at its Widnes site.”

Merriman also encouraged train builders to work with open access and other UK operators, as well seeking export business.

An annex to the letter listed current live competitions that were already listed on government websites (see table). The dates listed with these competitions suggest it’s unlikely that any contracts will be signed until 2025, with no deliveries until 2027 at the earliest. Volumes might reach 2,000 vehicles, largely concentrated around 2029, which suggests another round of the boom and bust cycle is set to be locked in.

There was also little in the letter that the rail industry did not already know.

Indeed, Merriman wrote: “While I appreciate that some of the information provided here is indicative or that you will already be aware of, I trust that it is nonetheless helpful to provide this level of visibility to the industry about our thinking.”

The overall conclusion from this letter can only be that the UK government isn’t thinking about rolling stock. Indeed, a sceptic might suggest that Merriman’s inclusion of the phrase “subject to business case approval” means that the UK government remains to be convinced about the need to replace ageing rolling stock, or that it has a role in helping smooth the boom and bust seen over recent decades.

Yet as Britain’s rail industry stands, Westminster’s government plays a vital role. It tightly controls train operator spending within England, and it owns and largely funds Network Rail.

This means that decisions about electrification sit with government - and the provision or not of overhead wires plays a key role around rolling stock decisions. So, in the absence of committed wiring plans, stock such as those Class 379s sits in store.

If the government plans to keep a tight rein on train operator spending, then it needs to consider aspects beyond rolling stock.

Malcom Brown told the December Transport Committee meeting: “If you go to battery, how are we going to charge it? Where are we going to charge it? How are we going to connect to the National Grid?

“Just now, there is a timeframe of about seven years, I believe, for certain parts to connect. There is no point having a battery train if we have nowhere to charge it. I’m not going to take a three-pin plug to the depot and shove it in. I need to think of the whole actual system - but the investment is there, and it is willing.”

It’s that need for system thinking that brings the government into play, even if the investment itself comes from private sources such as pension funds.

As Crossfield said in his evidence to MPs: “The type of rolling stock that you can have, and will be buying, is also determined by the type of infrastructure that you are going to have.

"There needs to be that kind of consistent, long-term investment view. It needs to be stable, and it needs to reside in an overarching body like the DfT.”

It should also avoid too much detail, according to Brown: “I do not agree that the guiding mind should be programming which trains are made when. I think the guiding mind should be taking information, such as the long-term rolling stock strategy, and saying: ‘This is what we see as a predictable future.’

“It should be at that level, not down in the weeds, and setting out a view of the whole system and its infrastructure, and how you interconnect with car transport, bikes, and so on, rather than being incredibly myopic. People tend to drift into the detail because, of course, that is what they can be certain of. We need it to be at a higher level.”

On the immediate problem of work ceasing at Alstom’s Derby plant, which Crossfield said in December would be finished by the end of January, Alstom told RailReview in mid-February: “Discussions are continuing with the UK government over the future of train manufacturing in Derby.”

Is rail decarbonisation on track - and does it matter?

DAVID CLARKE, Railway Industry Association Technical Director

The short answer to the question above is no and yes respectively… but let me explain why.

The GB rail network is not on track to be net zero by 2050, simply because we are not delivering electrification or zero-carbon rolling stock at a pace which will meet that deadline. This is despite the welcome inclusion of additional electrification in the Network North announcement.

Does that matter? Yes, it does!

Rail is a very efficient transport mode. Passenger trains are responsible for about 8%-10% of daily journeys, but only 1.4% of UK transport emissions. And every freight train replaces up to 129 heavy goods vehicles on the roads.

A cynic might look at this and say: “Why bother? Let’s focus on the other 98.6% of carbon emissions!’”

That would be a mistake. Rail punches above its weight today in terms of carbon reduction. and why would you want to damage that? But rail’s future promise is to support modal shift, and thus reduce both carbon and congestion in other modes.

This is not fanciful. A recent report by Steer Group predicted between 37% and 97% passenger demand growth, and the Government has set a target for 75% freight growth.

So, how can we get rail back on course?

The Railway Industry Association believes that a clear strategy is urgently needed. Electrification has high up-front costs, but (long term) it is the most economical way to operate a busy railway.

Further, a recent report identified that around 1,200km (750 miles) of electrification would decarbonise 95% of rail freight. For the less intensively used parts of the network, technology such as battery passenger trains are already starting to be introduced.

A key strategic document that is missing today is an agreed map of what will need to be electrified to decarbonise the GB rail network.

Currently 38% of the network is electrified, and projects currently under way or proposed will increase this to 51%.

However, RIA estimates that approximately two-thirds of the network will need to be electrified. A rolling programme of electrification to deliver this over the next 25 years would incentivise investment in the people, process and plant that increase productivity and thus reduce cost.

Such a map would also make clear what will not be electrified. This would allow rolling stock investors to offer new or refurbished trains - perhaps bundled with the necessary supporting infrastructure.

An immediate opportunity is to address the circa 1,100 diesel vehicles which will be 35 years or older by 2030 - not only reducing carbon but also improving railway performance and passenger experience.

To summarise: to get rail decarbonisation back on track for 2050, improve the customer experience, and prepare for demand growth, there needs to be agreement on a 25-year rolling programme of electrification which will allow rolling stock proposals to support both this electrification and decarbonisation of the routes which will not be electrified.

This will not only contribute to the wider GB economy, it will also allow rail suppliers to deliver more cost-effectively by reducing the ‘boom and bust’ which has bedevilled the industry.