HITACHI is stepping up bids to win train contracts in the UK and across Europe after deciding to move its rail business from Japan to London, The Northern Echo can reveal.

An announcement in Tokyo this morning that Alistair Dormer will lead the firm's global rail business is the latest vote of confidence in Hitachi's UK operations following a decision to build a train factory in Newton Aycliffe, County Durham. 

The factory is due to start making trains for the Great Western and East Coast lines from spring 2016, employing at least 730 workers. 

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However, reports that shifting headquarters from Japan to London will create 1,500 UK jobs are premature, said a Hitachi spokesperson, who explained that the impact on jobs would be relatively minor in the short term. 

Nevertheless, the decision is significant and makes the UK the centre of Hitachi's drive to win train contracts across the world.

The firm is bidding for a deal to make trains for Scotrail, and for the German rail network, as well as to supply rail traffic management systems to Sweden. 

"Japanese companies normally prefer to have a Japanese person leading them, so for them to appoint Alistair is unusual, but very pleasing for the UK," the Hitachi spokesperson added.   

"The move to London is about positioning us a global business," they explained.

It is part of the firm's strategy to challenge the dominance of the industry's big players Alstom, Siemens and Bombardier.

"Today's announcement is a significant sign of intent by Hitachi to grow its business in the rail market," said Mr Dormer.

"Both the UK and Japan remain important as markets for Hitachi Rail, and with our train factory in the north-east of England now under construction, we will work to realise our export potential from the UK, expanding into Europe and emergent markets."

Vince Cable, the business secretary said: "This move demonstrates a huge vote of confidence in Britain, its workers and its rail industry from one of Japan's biggest businesses.

"It follows the company's announcement last year of 750 new jobs at their factory in Newton Aycliffe, which I was delighted to launch with (Transport Secretary) Patrick McLoughlin.

"It's further testament to the Government's industrial strategy which is giving companies of Hitachi's stature the confidence to invest in the UK in an expanding rail sector, creating new jobs and increasing exports that will help sustain long-term economic growth."