Wednesday, 6 July 2011

Bombardier


Bombardier's Derby operation has recently been dealt a severe blow. The result of which will be a loss of 1,400 jobs; these will comprise 446 permanent positions and 983 temporary contracts. Having been through the redundancy process all those concerned have my sympathies and I hope that, ultimately, they all find something.

The reason behind the decision to shed the jobs is a result of Bombardier failing to secure the contract for the construction of rolling stock for the Thameslink project. The Government's decision has, apparently, been made in line EU directives. I must admit I'm in favour of free enterprises - in fact the last thing society needs are companies with ruthless monopolies which have the potential for high prices and poor value for money - but I'm not convinced that this will offer the best value overall.

Although the cost per unit from Siemens, who did win the contract, maybe less than Bombardier's tender but the long term effects could be very expensive. In the first instance there is the obvious cost of Unemployment and associated benefits and tax credits (and I hope those made redundant have a better time with the Department of Work and Pensions than I did!) and this may mean less money in the local economy which, though small, will have an effect. Education costs if any former staff make use of state funded schemes, admin associated with the whole process too and many other costs.


Original photo can be found here.

It's possible that Bombardier will win new contracts in the future, I hope they do, but you can't create a pool of skilled and knowledgeable workers easily. It could take years to rebuild this wonderful asset, assuming they can.

Please don't think that this is in any way politically motivated, it's not. I just don't want us to loose the great assets which the, our, industry has. The overall value of contracts like this should be the prime consideration; private companies need to ensure, generally, that they have the best contract at that particular time as business but when work is publicly funded I think it's different. The wider effects and costs should be, at least, considered. And I don't think this should be any different for governments of any political persuasions either. Vince Cable, the Business Secretary, has even said that the rules are unsatisfactory and has called for a review of EU procurement regulations but this will come too late for Bombardier.

The irony of all this is that the railway system in the UK could see some major developments over the next decade or so - huge electrification plans, whether you agree with them or not, will require vast resources and, of course, rolling stock to bring the plans to fruition. It will be a huge shame if all this stock is built abroad instead of here exploiting all of the engineering talent which this country still possesses.

Further Reading

RMT response to job losses announcement at Bombardier
RMT - Protests at Bombardier Job Cuts

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