Deal hinges on winning HS2 trains
Longannet secures 1,000-jobs Talgo train factory
Paul Lewis, chief executive of Scottish Development International, with Carlos de Palacio, president of Talgo, and the company’s UK Director Jon Veitch during a visit to Edinburgh last month (pic: Terry Murden)
Longannet has secured a Spanish company’s £40 million investment in a 1,000 jobs factory to build the next generation of high speed trains.
The decision, announced this morning by Talgo in London, will provide a huge boost to the Fife and Scottish economy, particularly in the aftermath of the almost certain loss of the Michelin tyre factory in Dundee. It is also a big vote in Britain ahead of the country’s exit from the EU.
However, the plan hinges on winning the contract for high speed trains in the UK. If it secures that deal the former power station site at Longannet will be transformed into a 70,000 sq ft factory over 18 months from early 2020. The company will also develop its second preferred site at Chesterfield in Derbyshire as an innovation centre.
Longannet’s success is a huge feather in Scottish Enterprise’s cap after it pulled together a team of industrialists, academics, politicians, civil servants and development experts who were described by Talgo’s president as “a credit to Scotland”.
The two sites were shortlisted following a tour of potential locations around the UK by a delegation of company representatives. Hunterston in Ayrshire was among the candidates that were ruled out.
Should Longannet get the final go-ahead it will require a huge recruitment exercise for skilled workers on a scale not seen for some years.
Although there will be a central factory location, some key components are expected to be made elsewhere in the UK, and integrated into the final build at the facility in Longannet. This will ensure that the benefits of Talgo’s investment can be felt more widely across the UK.
Instead of assembling kits of parts from overseas, the company wants an “All Britain” strategy that means sourcing components from within the UK which will be a huge boost to the supply chain.
Talso said the site at Longannet has “great connectivity” and has the potential to supply people that can be skilled-up to meet the needs of building trains that can run at up to 235mph.
The choice of factory location results from an 18 months search involving detailed discussions with land owners, development agencies, local authorities, research establishments, schools, colleges and Universities.
Talgo intends not only to build for the UK market, but also to serve emerging overseas markets, boosting UK exports.
Talgo is building new high speed trains for rail networks around the world
It is mainly focused on designing, manufacturing and servicing fast, lightweight trains, including the Haramain high speed railway line between La Mecca and Medina in the Middle-East, and is the provider of the new AVRIL train to Spanish operator RENFE.
Carlos de Palacio, president and grandson of the founder, said: “This has been a tremendously challenging mission for Talgo, and I have personally seen excellence in all corners of the UK. It has been a difficult decision to make, as the quality has been so high in so many places.
“The establishment of a manufacturing facility at Longannet is a significant part of Talgo’s future strategy.
‘”I want to congratulate Paul Lewis and Scottish Enterprise, for bringing together a wide-ranging team of industrialists, academics, politicians, civil servants and development experts. Their efforts are a credit to Scotland.
‘However, our plans do not end in Scotland. Linked to our ‘all Britain’ strategy, we intend to create opportunity and harness skills across the UK.
“Talgo’s approach keeps more money in the UK economy, and creates more skilled long-term jobs.”
UK director, Jon Veitch, said: “This is not only an exciting day for Talgo, it is an exciting day for the UK, too.
“When Talgo started this process, we were looking for just one site. However, we soon realised that all parts of the UK had something to offer.’
“We have learned about the many rail-related initiatives across the UK, intended to boost capability for research, development, and testing. There is an engineering renaissance under way, and I want Talgo to be a leading partner.
“Talgo wants to see a steady supply of engineers and other skilled people enter the workforce, and be the innovators of the future.
“As part of Talgo’s commitment to the UK-wide supply chain, our preferred second facility – in Chesterfield – will act as a catalyst.
‘”We are developing this aspect of our strategy, and continue to consult with potential partners. We will make a further announcement, once discussions have concluded.”
Talgo is also working with the Scottish Government to develop the branch line to the former power station, which could include the return of passenger trains. Discussions have also taken place about electrifying the line.
Michael Matheson, Scottish Secretary for Transport, Infrastructure and Connectivity, welcomed the deal but noted that it was conditional on securing the contract for HS2.
He said: “This investment is a significant achievement for Scotland and yet another endorsement of our country’s attractiveness to international investors.
“Should Talgo be successful in its bid to win the contract for HS2 rolling stock, this new factory at Longannet would bring a great number of new jobs to Fife, which would be a welcome boost for the local area.
“However, the full economic impact of such an investment, and the supply chain opportunities it would bring, would be felt right across Scotland.
“We are committed to working with Talgo and our public and private sector partners to ensure maximum benefit from the opportunity this proposed investment represents.”