UK-based train maker Bombardier, which lost out to Germany for a lucrative order, has won a new £188m contract.
The Department for Transport, heavily criticised for preferring Siemens of Germany to Derby-based Bombardier for the Thameslink contract, is providing £80m for the new deal with the Southern train company.
Bombardier, which announced hundreds of jobs losses after failing to win the Thameslink deal, will build 130 new carriages for Southern’s trains in south London, Surrey, Sussex and Kent.
The Canadian Bombardier firm said production of the Electrostar trains would start in the second half of the coming year and the first new carriages would enter service in December 2013.
Transport Secretary Justine Greening said: “This deal for more than 100 new carriages is great news for rail passengers and brilliant news for Bombardier and Derby.
“It lands Bombardier with a crucial train order and I look forward to Bombardier workers in Derby being among the winners of this important deal.
“This deal, helped along by my department, shows my determination to invest in Britain's railways.
“Our support for Southern will boost capacity while helping British jobs. I can’t think of a better outcome.”
Paul Roberts, president of Bombardier Transportation’s Services UK division, said the company was “delighted” to win the competitive tender for the new trains.
As well as the Crossrail deal, Bombardier is also hoping to win the eVoyager contract which involves converting a fleet of existing diesel-powered Voyager trains, operated by the German-owned CrossCountry train company, so they can run on hybrid electric power.
Ms Greening announced before Christmas that she was instructing her officials to work closely with Bombardier and other parties involved so that technical and business case work could be completed as soon as possible and a firm decision could be made on the project.
Mr Roberts said: “It is encouraging news from Ms Greening on her plans for the eVoyager project, where we hope a contractual agreement could be reached in the first quarter of 2012.
“In addition, early in the new year we look forward to having greater clarity on procurement for the Crossrail project and welcome the House of Commons Transport Committee’s recommendations that future tenders separate train financing decisions from train design and manufacturing.
He added: “These developments are therefore an encouraging step in the right direction and will be integral elements in considerations as part of Bombardier’s UK review.”
The row over the Siemens-Bombardier battle for the Thameslink contract prompted the Government to look at the entire question of future rail procurement.
Government funding for the Southern deal came from money made available following last month’s Autumn Statement by Chancellor George Osborne.
Bob Crow, general secretary of the RMT transport union, said: “The Southern carriages order is both welcome and deserved and shows that Bombardier in Derby is geared up to deliver top-quality engineering.
“However, the award of this contract does not let the Government off the hook on either the unsigned Thameslink contract or the looming (cross-London project) Crossrail deal.
“That’s the work we need to secure the long-term future of train building in the UK.”
Derby North MP Chris Williamson said the order was “extremely good news.”