£500 million deal to maintain hundreds of jobs in the northeast for years to come

Government helps deliver a train-building deal that will give Hitachi's Newton Aycliffe site a future – helping protect hundreds of jobs in the Northeast.

FirstGroup, Hitachi and Angel Trains have struck a deal to build 14 state-of-the-art trains to be used on rail lines across the UK, as part of a £500 million deal that will uplift the industrial heartlands, and boost rail services for passengers across the UK.

The Government has delivered meaningful engagement, a stable economy, and a proper strategy for rail, which has created the right atmosphere for this deal to happen.

The Northeast is key to the UK's industrial heartlands, and this sensible approach – which has been supported by the Northeast Mayor Kim McGuinness and the Local MP Alan Strickland - is ensuring this region isn't being left behind. It follows the Prime Minister visiting the manufacturing plant in April and promising to help secure jobs.

The announcement comes as the Prime Minister and the Transport Secretary visit the site to speak to staff and hear first hand of the benefits that rail passengers will feel as a result of this new deal.

In the face of that shocking inheritance, the Government will always stand with working people. That was made clear in the new Plan for Change, announced by the Prime Minister yesterday.

These are ambitious milestones that will deliver real improvement to people's lives. This Government is determined to raise living standards across the country, rebuild Britain with 1.5 million new homes, end the hospital backlogs, put 13,000 police back on the beat, and give every child the best start in life.

The Government has been working from day one to solve problems, not create them. That means rolling up its sleeves, and getting people around the table to have the hard conversations that have been ducked for too long. This approach is working – and is creating optimism in the future of rail since coming into power – creating a climate for business to invest, that has already attracted £60 billion of inward investment in the UK at the International Investment Summit.

This deal reflects a new way of doing business – a grown-up approach to industrial relations that puts country first.

The Prime Minister, Keir Starmer, said:

“Our Plan for Change has set out ambitious milestones that will deliver real improvement in people's lives – raising living standards across the country.

“That means taking grown-up approach to business and using the heft of Government to solve problems, not create them. Getting people in the room to have the hard conversations which have been ducked for years.

“That approach is paying off. Not only has it saved jobs, but it has given business the certainty and stability they need to thrive.

“Today's announcement is a case in point. We helped secure a deal that will help protect hundreds of jobs, keep this business ticking, and improve rail services.  

”I made a promise to the workforce of the Newton Aycliffe factory and today, I'm delivering on that promise. 

Today's visit reaffirms the Government's support for rail manufacturing in the UK and commitment to developing a long-term strategy to secure the industry's sustainable future.

It proves the pipeline for orders is strong, with a number of operators in the market for new trains providing contract opportunities for all UK rolling stock manufacturers.

The agreement will deliver 14 new five-car class 80X Hitachi electric or bi-mode trains (a total of 70 cars). Delivery of the new trains is expected to commence in late 2027. In addition, the agreement provides FirstGroup the options to lease up to a further 13 five-car trains, should their recently submitted other open access applications be successful.

The success of our industrial heartlands is the success of our nation. So the Government is revitalising our railway industry. British trains used to be the envy of the world. This government is going to return our railways to that golden era once more - treating those who build our infrastructure with respect and putting the passengers who use it first.

Transport Secretary Heidi Alexander said:

“This Government is determined to rebuild our broken railways – which includes taking action to create a stable investment environment for our critical UK rail manufacturers.

“This deal will bring significant benefits to the North East, and we're committed to working closely with the entire sector so that it can continue to support jobs and growth across the country and help deliver a railway fit for the 21st century.”

North East Mayor Kim McGuinness said:

“Immediately after the General Election I wrote to the Prime Minister with a set of asks to back the North East. Hitachi was top of that list.

Six months on, together, we have delivered for the region. Today shows the power of what we can achieve when we stand together, and that our great North East has bright days ahead of us. We have a government on our side, and working with me to make the North East the home of real opportunity.”

Graham Sutherland, FirstGroup Chief Executive Officer, said:

“The introduction of our new service between London and Carmarthen, and the extra capacity on Lumo and Hull Trains, will significantly increase our open access portfolio over the next few years, with further expansion possible should our recent applications be successful.

“The new trains, to be manufactured for us in County Durham by Hitachi, will support UK manufacturing and offer customers more choice as they consider affordable, environmentally friendly modes of travel in the future, and we are pleased to be taking them forward.

“We know that growth and innovation are key for the future of the railway sector and are committed to working with government and all our partners to provide competitive, sustainable and improved services.

“Successful open access services can provide new connections, add capacity, support local businesses and suppliers, secure jobs and help to drive social mobility and future economic growth.”

Jim Brewin, Chief Director of UK & Ireland at Hitachi Rail, stated:

“This contract is a positive step forward, and just recognition for the hard work and patience of our teams across the Hitachi Rail UK business over recent years.

“We look forward to once again delivering for Hull Trains and Lumo passengers who will benefit further from our award-winning British built trains.

“Equally, we owe a debt of thanks to the Northeast Mayor Kim McGuiness and other local MPs who have worked tirelessly in support of this private sector investment.”

Malcolm Brown, CEO of Angel Trains, said:

“This is a major milestone for the UK rail industry. In less than three months we have delivered over £270m of investment that will bring millions more passengers onto the rail network, connect key regional centres across the UK, secure crucial manufacturing jobs and breathe new life into local economies.

“This is the first announcement of its kind in six years but our ambitions don't stop here - this milestone represents the beginning of a new and exciting journey, which will see Angel Trains play a leading role in the green transition of our rail infrastructure.”