PRESSURE is mounting on a North-East public body to review a decision to award a £500m contract to a Spanish company rather than a train builder in the region which has been struggling for orders.

Nexus insisted the procurement process is still ongoing and a final decision will not be made until January, but insiders have been told Hitachi will be overlooked.

Last night, the revelations were criticised by PD Ports Chief Executive Officer Frans Calje, who described it "very disappointing" that Hitachi – which he described as allowing "Newton Aycliffe and Darlington to be the centre of excellence in manufacturing for Europe" - are set to miss out on a local contract.

Tees Valley Mayor Ben Houchen, who yesterday described the decision as "madness" and "appalling", has since sent a letter to the managing director of Nexus and the leaders of each of the Tyne and Wear Councils, calling on them to "halt this disastrous process before the wrong decision is made".

In the letter, Mr Houchen said: "As a Mayor, representing the people of the North-East, I find it appalling that you have come to a decision which fails to protect a major North-East business and local jobs.

"It has taken years to bring Hitachi to the North-East and make them the powerhouse that they are. Tyne and Wear Councils via Nexus have complete control of this process and and I am calling on you to do the right thing and halt and revealuate this disastrous process before the wrong decision is announced."

Mr Calje said: "Considering the investment Hitachi has made and the high hopes they had for allowing Newton Aycliffe and Darlington to be the centre of excellence in manufacturing for Europe essentially, I think it is very disappointing if they wouldn't be able to get a local contract, given the importance it has to the regional economy."

The revelation was a fresh blow for Hitachi, which has been struggling for orders in recent months after it missed out on a contract to build 94 new Deep Tube trains to serve the London Underground’s Piccadilly line, which was awarded to Siemens who will now build the trains in Austria.

However, the firm did recently secure a £400m contract to build 165 carriages for a new fleet of intercity trains for East Midlands Railway, but bosses insisted they still required another significant order to secure their long-term future.

Sedgefield MP Phil Wilson said: "It is deeply disappointing if it turns out to be true but, as Nexus say the procurement process is ongoing, I don't want anything to happen that might jeopardise that process."

Adrian White, head of transport and contract services at Durham County Council, said: “We are aware of the story, and have been advised by Nexus that the procurement process is ongoing and the successful bidder won’t be officially announced until January.”

A spokesperson for Hitachi said they were unable to comment due to public procurement rules.

A spokesperson for Nexus said: "The procurement of our new train fleet is an ongoing process. We cannot comment on any details of the respective bids from Hitachi Rail, Stadler or CAF at this stage.

"The successful bidder will be officially announced in January.”

The Northern Echo approached the leaders of Newcastle, Gateshead, and South Tyneside councils, but they all declined to comment whilst the procurement process was ongoing.