Serious concerns have been raised over the future of Hitachi’s Newton Aycliffe plant after bosses failed to reach an agreement with the Government to keep their order books full.

Bosses at Hitachi said they have been in talks for two years in an attempt to find a solution, but this had "not resulted in a positive resolution".

The factory keeps 750 people in work on-site, alongside another 1,400 jobs indirectly. 

The Northern Echo understands that while the company is believed to have some 56 trains left on its order books, it will already be well along its timeline with many of those, leaving perhaps as few as two dozen projects still to be started.

The factory, which opened in 2015, is making its final trains for Avanti West Coast and East Midlands Railway.

Ministers told Hitachi this week they had no plans to order more trains to run on the West Coast mainline, which the firm saw as the only viable way to plug the production gap.

This has heightened the sense of crisis, with the risk of significant layoffs, or even the closure of the plant, over the next 12 months.

This weekend, Hitachi said it was reviewing its options.

In a statement, it said: “We have been engaged in discussions at all levels of UK government for two years, in an attempt to find a solution to the production gap at our Newton Aycliffe manufacturing facility.

“Disappointingly these discussions have not resulted in a positive resolution.

"We are now reviewing all remaining options available to us in order to keep our manufacturing teams building rolling stock to support the UK rail industry.”

Sedgefield MP Paul Howell, who has championed the Newton Aycliffe plant said last night (Sunday): "I am as disappointed as anyone a resolution could not be achieved and I am working as hard as I can to support Hitachi and encourage Government to consider any and all possible options."

Hitachi in the North East contributes more than £400million to the UK economy and is a key part of the region’s status as a manufacturing powerhouse, but workers at the site have spent two years awaiting a government decision to extend their existing contract so they can build new rolling stock.

In March 2019, Lumo ordered five AT300 trains for its services on the East Coast Main Line. The five units were built at Newton Aycliffe and maintained by Hitachi for ten years as part of the £100 million deal.

In January 2020, bosses were devastated when Hitachi lost out on a £362m Tyne & Wear Metro bid, with Nexus awarding the contract to the Swiss company Stadler.

In 2021, Hitachi and Alstom won a contract worth up to £2.8bn to build 54 trains for HS2 rail line.

But last year Prime Minister Rishi Sunak cancelled the northern leg of HS2 from Birmingham in the Midlands to Manchester to rein in spiralling costs on what has been labelled the most expensive infrastructure scheme in Europe.

Last week Shadow Transport Secretary Louise Haigh called on the Government to take action to safeguard the plant's future. 

She said: “The Secretary of State has it in his power to vary their contracts and commission the necessary orders. When is he going to do it and protect these jobs?”

During the same Parliamentary session, Sedgefield MP Paul Howell, raised the matter, saying: “The secretary of state and ministers are well aware, following many conversations and engagement, that companies like Hitachi in Newton Aycliffe in the rolling stock for rail to supply chain have significant short-term challenges.

“Next year will celebrate the 200th anniversary of the first passenger railway in the world, which runs next to the Hitachi factory.

"Can he update me on what he is doing to ensure that companies like Hitachi have a long-term future in the UK, so that they can build the next generation of North East trains.”

Transport Secretary Mark Harper replied, Mr Howell had been a “doughty champion for his constituency” and had raised the issue with him on a number of occasions.

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He added: “I have had frequent meetings with Hitachi, both with the UK management and in Japan. We are working very hard to deal with the situation.

“The HS2 order they have was confirmed on the original terms and I am working with them, and the Rail Minister recently published the pipeline for future rolling stock, much of which they (Hitachi) would be competitively placed to win and I hope we’ll be able to reach a successful conclusion in the very near future.”

The Department for Transport said: “The Government is committed to supporting the entire sector and is working with all rolling stock manufacturers, including Hitachi, on the future pipeline of orders which we expect to remain strong in the coming years.”