Lack of train orders in the next five years & what should be done about it

[absolutelymilk]

Is anyone else worried by the fact that there currently seem to be very few orders for new rolling stock? In the five years from 2022 to 2026 (inclusive), we've had the following come into service:
99, 196, 197, 230, 231, 398, 701, 730, 756, 777, 805, 807 and 810.

In the five years from 2027 to 2031, we'll have (hopefully!) the first few vehicles of the Northern & Scotrail order, the LNER 897s and the HS2 order (even though it won't come into service for a long time!). There's also the ten extra 345s, but overall it seems like there will not be much work for UK rolling stock builders in the next few years, particularly in the first couple of years of that period. Am I missing some or are we likely to see factories temporarily/permanently shut down?

 

[gazthomas]

Alstom certainly is

 

[busken]

With the threat of re nationalisation looming, is it any suprise companies aren't prepared to invest in rolling stock?

 

[HamworthyGoods]

Is anyone else worried by the fact that there currently seem to be very few orders for new rolling stock? In the five years from 2022 to 2026 (inclusive), we've had the following come into service:
99, 196, 197, 230, 231, 398, 701, 730, 756, 777, 805, 807 and 810.

In the five years from 2027 to 2031, we'll have (hopefully!) the first few vehicles of the Northern & Scotrail order, the LNER 897s and the HS2 order (even though it won't come into service for a long time!). There's also the ten extra 345s, but overall it seems like there will not be much work for UK rolling stock builders in the next few years, particularly in the first couple of years of that period. Am I missing some or are we likely to see factories temporarily/permanently shut down?

You also have new fleets for Lumo, Grand Central and Northern Ireland Railways.

 

[skyhigh]

With the threat of re nationalisation looming, is it any suprise companies aren't prepared to invest in rolling stock?

This is a bit of a red herring. Since COVID, the operators have simply been on managing contracts and doing what they are told to by the government. They have no freedom to choose to invest in new stock.

 

[Strathclyder]

I doubt we'll be seeing any substantive movement on the ScotRail order until next year at the earliest or even going into 2028 given it's scale and complexity, regardless of who ends up winning the contract. Dedicated thread here below for more details on why it's been taking so long:

ScotRail Suburban Fleet (EMU and BEMU) Market Engagement

ScotRail Trains Limited (SRT) Market Engagement Notice SRT is launching a market engagement exercise in relation to its proposed procurement for the replacement of some of its aging Diesel and Electric Multiple Units with a new fleet of Electric Multiple Units (EMUs) and Battery Electric...

www.railforums.co.uk

It's also the main reason why the leases on the 318s & 320s have just been extended to at least 2032:

Class 318/320

With the various posts on Class 318/320 reaching 40yrs old soon… does anyone know when next major overhaul is due, if they are to continue in service. My thoughts are that the Class 320 could be due in 2yrs with the Class 318 2 years behind. Not sure where bogie overhauls are if they are more...

www.railforums.co.uk

 

[swt_passenger]

Only yesterday there were posts about a Southeastern replacement EMU order having been agreed but not yet announced?

There’s supposed to be a joint DMU procurement underway for GWR, SWR and Chiltern?

 

[A S Leib]

There’s supposed to be a joint DMU procurement underway for GWR, SWR and Chiltern?

In Chiltern's case, is that meant to replace 168s or just 165s, as I think the former were only refurbished around two years ago?

Probably a question which has come up before here, but should diesel-only trains still be ordered at all rather than bi-modes?

 

[yorksrob]

Have the new Bakerloo line trains been ordered yet ? If not, there's some.

 

[swt_passenger]

In Chiltern's case, is that meant to replace 168s or just 165s, as I think the former were only refurbished around two years ago?

Not sure, I just remembered there was a thread about this a year ago (below). It was mentioned, but didn’t get an entry in the sticky thread in this forum, because there was too little detail.

GWR, SWR and Chiltern possible combined fleet order - Philip Haigh

(Apologies if there is a thread not easily labelled on this already) According to Philip Haigh the DfT are talking to these three TOCs about replacing their diesel fleets within the same order: https://x.com/philatrail/status/1945423791624016286 DfT is talking with GWR, SWR and Chiltern about...

www.railforums.co.uk

 

[RUK]

Only yesterday there were posts about a Southeastern replacement EMU order having been agreed but not yet announced?

The Southeastern procurement process has finished in that they’ve decided who they want to award the contract to, but they’ve just submitted the business case to the Government for it to fund it. So it’s not funded yet, so it’s not absolutely certain that it’ll go ahead, and it’ll probably be a while until it’s approved - but it basically has to go ahead, since new stock is necessary.

Have the new Bakerloo line trains been ordered yet ? If not, there's some.

Not yet.

 

[RealTrains07]

Is anyone else worried by the fact that there currently seem to be very few orders for new rolling stock? In the five years from 2022 to 2026 (inclusive), we've had the following come into service:
99, 196, 197, 230, 231, 398, 701, 730, 756, 777, 805, 807 and 810.

In the five years from 2027 to 2031, we'll have (hopefully!) the first few vehicles of the Northern & Scotrail order, the LNER 897s and the HS2 order (even though it won't come into service for a long time!). There's also the ten extra 345s, but overall it seems like there will not be much work for UK rolling stock builders in the next few years, particularly in the first couple of years of that period. Am I missing some or are we likely to see factories temporarily/permanently shut down?

It is not really surprising though is it? Not when in the past 10 years we have seen TOCs order an exceptional amount of new rolling stock across the country.

I could see us getting to a point where rolling stock orders might dry up for little a bit of time but I guess at the end of the day that is a risk when you do full fleet replacements like TfW and GA did and have no national rolling stock strategy.

 

[pokemonsuper9]

Am I missing some or are we likely to see factories temporarily/permanently shut down?

The Piccadilly line 2024 stock is still under construction at Goole and testing on the underground and has not yet entered passenger service.

 

[LNW-GW Joint]

The Northern procurement (EMU/BEMU) is probably the most advanced but no order is expected until at least the turn of the year.
I can see it all slipping until GBR is up and running, and able to negotiate with DfT for funds for new stock.
The extra 345s, the Hitachi open access orders and the Siemens Piccadilly line and CAF 897 orders were supposed to keep the factories busy until "GBR" made its first purchases.
We've since seen the 350/2s allocated to Northern (replacing 323s).

 

[MrC]

Probably a question which has come up before here, but should diesel-only trains still be ordered at all rather than bi-modes?

There's vast swathes of railway that will likely not see electrification in any form for decades, if ever, and many of those lines operate as self-contained routes. Providing bi-modes for those lines would result in trains that would be more expensive to procure and to maintain and operate. There might be better arguments for producing a modular DEMU that could have it's traction package modified or swapped-out out should things change but a cynic might put that beyond what the current crop of politicians and civil servants are capable of considering.

The West of England line might be one which could benefit from diesel/3rd rail bi-modes but I can't see that being considered possible these days (the WoE really needs pulling up and re-building from Salisbury to Pinhoe but that's another issue).

 

[Roylang]

I can see it all slipping until GBR is up and running, and able to negotiate with DfT for funds for new stock.

I can see it all slipping until shortly before the next General Election. It has happened before.

Roy

 

[Russel]

There's vast swathes of railway that will likely not see electrification in any form for decades, if ever, and many of those lines operate as self-contained routes. Providing bi-modes for those lines would result in trains that would be more expensive to procure and to maintain and operate. There might be better arguments for producing a modular DEMU that could have it's traction package modified or swapped-out out should things change but a cynic might put that beyond what the current crop of politicians and civil servants are capable of considering.

The West of England line might be one which could benefit from diesel/3rd rail bi-modes but I can't see that being considered possible these days (the WoE really needs pulling up and re-building from Salisbury to Pinhoe but that's another issue).

I'm in agreement with this.

The idea of no more straight DMU orders seems to be more of an ideological one than a practical one, unless we start wiring routes like the West Highland for example.

 

[Magdalia]

Is anyone else worried by the fact that there currently seem to be very few orders for new rolling stock? In the five years from 2022 to 2026 (inclusive), we've had the following come into service:
99, 196, 197, 230, 231, 398, 701, 730, 756, 777, 805, 807 and 810.

The key factors are financial: high inflation and high interest rates.

It now costs a lot more to build a new train, and it costs a lot more to borrow the money to pay for it.

 

[RUK]

There's vast swathes of railway that will likely not see electrification in any form for decades, if ever, and many of those lines operate as self-contained routes. Providing bi-modes for those lines would result in trains that would be more expensive to procure and to maintain and operate. There might be better arguments for producing a modular DEMU that could have it's traction package modified or swapped-out out should things change but a cynic might put that beyond what the current crop of politicians and civil servants are capable of considering.

Batteries could enable less pollution in stations and around urban areas.

The key factors are financial: high inflation and high interest rates.

It now costs a lot more to build a new train, and it costs a lot more to borrow the money to pay for it.

I suppose the Government are trying to hold off as long as possible and see if there will be any drop in interest rates before they make any orders.

 

[millemille]

The Government is not required to make any Capital Expenditure in the procurement of new trains, that is the responsibility of the Rolling Stock Owning COmpany who will finance the procurement and recover their investment, plus profit, through leasing the trains to the operator (which is in reality the government through DfTO and in turn GBR at some point in the future) for 30 or more years.

The Government is required to commit to an almost certain increased Operational Expenditure of the railway, through the Operator which will operate the new trains, because the new trains will be be more expensive to lease than the incumbent trains because the purchase price per carriage, even when the purchase price is indexed to account for the inflation over the period since the incumbent trains were purchased, is significantly higher.

An Alstom (Bombardier, as was) Electrostar back in 2002 cost about £1M per carriage, which is about £1.9M today when indexed.

I've heard a figure of about £3.25M a carriage for the Alstom Adessia offering for the current TPE and SE tenders being spoken of at the DfT.

And an increase in the Op Ex of the railway is the very last thing that the DfT want or need right now. Their full, #1, king of the hill, el primo focus is on reducing the operational deficit of the railway, and increasing the Op Ex of SE by somewhere in the region of £250k per day without a matching increase in income doesn't align with that. So you can bet your bottom dollar that there are all kinds of scenario's being modelled and costed by the DfT around leaving incumbent trains in place or cascading stock or leasing new . And it is this process which is holding up any procurement commitment and ultimately still making it far from certain whether new trains will be procured.

And lurking in the background is the DfT's desire to step away from TSSSA and TSP packages from the train builders as the DfT believes it does not offer them best value for money (which is open to debate). But most train builders, and the supply chain beneath the train builder, make little or no margin on the the new build, their profit comes from 30 years+ of service provision which is not subject to any form of competition. And the operators like TSSSA for no other reason than it makes procurement of future upgrades, modification, modernization etc. much easier because the procurement doesn't have to go through the Public Procurement Process, which is slow/expensive/fraught with risk, and can be directly award to the train builder as the terms of TSSA don't allow the operator any choice but to do this.

If you take the assured income and profit from the TSSSA away from the train builders then the low margin on the original sale of the trains goes.

 

[Roylang]

The key factors are financial: high inflation and high interest rates.

It now costs a lot more to build a new train, and it costs a lot more to borrow the money to pay for it.

Sorry, but inflation and interest rates still sit at what are very low rates. Look back at the 1980s and 1990s and you will see what high rates looked like.

Over the last 50 years, the average is around 9.1%

Over the last 100 years, the average is around 8.3%

The country got spoilt when for a period we had near zero inflation and interest rates. Today’s rates still sit about half of those averages.

Roy

 

[TRAX]

That's what a lot of us were worried about when various manufacturers suddenly decided to open several factories in the UK at the same time... It was bound to happen at some time...

 

[fgwrich]

That's what a lot of us were worried about when various manufacturers suddenly decided to open several factories in the UK at the same time... It was bound to happen at some time...

Indeed, boom and bust. The two I can see being most affected over the coming years are CAF’s Newport facility (unless they are building the LNER fleet?) and Hitachi’s Newton Aycliffe facility (less at risk of closure than CAF but I can’t see more orders than that from open access coming).

 

[norbitonflyer]

Is anyone else worried by the fact that there currently seem to be very few orders for new rolling stock? In the five years from 2022 to 2026 (inclusive), we've had the following come into service:
99, 196, 197, 230, 231, 398, 701, 730, 756, 777, 805, 807 and 810.

Also Class 93 and 555

 

[Magdalia]

Sorry, but inflation and interest rates still sit at what are very low rates. Look back at the 1980s and 1990s and you will see what high rates looked like.

Over the last 50 years, the average is around 9.1%

Over the last 100 years, the average is around 8.3%

The country got spoilt when for a period we had near zero inflation and interest rates. Today’s rates still sit about half of those averages.

Roy

The original post isn't comparing with the 1980s, and lead times from placing orders to taking delivery need to be taken into account. We are comparing orders now with deliveries 2022-26, most of which were ordered when inflation and long term interest rates were low.

 

[RUK]

Indeed, boom and bust. The two I can see being most affected over the coming years are CAF’s Newport facility (unless they are building the LNER fleet?) and Hitachi’s Newton Aycliffe facility (less at risk of closure than CAF but I can’t see more orders than that from open access coming).

The last 8 of the 10 CAF Class 897 Serenzas will be built at Newport, after the first 2 in Spain. Hitachi didn’t get that order because apparently they jacked their prices up because they have enough work at the moment.

 

[Roylang]

The original post isn't comparing with the 1980s, and lead times from placing orders to taking delivery need to be taken into account. We are comparing orders now with deliveries 2022-26, most of which were ordered when inflation and long term interest rates were low.

Agreed, but that means today’s interest rates are higher, not that they are high. It is a pet hate of mine that interest rates are described as being currently high, which is not the case.

We need to keep in mind that it is highly unlikely we will see interest rates in the near future to be as low as we did.

Stock procurement cannot be predicated on interest rates being near zero. The likelihood is that interest rates will increase, with a 0.25% increase being forecast this year.

Roy

 

[HalsteadA4r0n]

Do Siemens have any work currently planned at Goole besides the 2024 tube stock?

 

[RUK]

Do Siemens have any work currently planned at Goole besides the 2024 tube stock?

No. The Piccadilly stock is being built into next year, and a follow-on order as part of the framework agreement is likely for the Bakerloo because it’s necessary, but there’s no official announcement of that or of funding for that yet, or for funding for the rest of the framework agreement for the Central and Waterloo and City lines, which probably won’t be until the 2030s.

That’s why they bid for the Southeastern stock replacement, and probably the other tenders which are out as well. They have probably bid for ScotRail as well, but I don’t believe the list of bidders or short-listed bidders have been announced for that, although the short-listing took place recently.

 

[Peter Sarf]

In Chiltern's case, is that meant to replace 168s or just 165s, as I think the former were only refurbished around two years ago?

Probably a question which has come up before here, but should diesel-only trains still be ordered at all rather than bi-modes?

Yes. Unlike Europe we have not electrified enough. There are plenty of routes with little or no parts electrified so BiMode is a waste of money. Battery Diesel might be worth it just to reduce emissions in built up areas and enhance acceleration.

The Southeastern procurement process has finished in that they’ve decided who they want to award the contract to, but they’ve just submitted the business case to the Government for it to fund it. So it’s not funded yet, so it’s not absolutely certain that it’ll go ahead, and it’ll probably be a while until it’s approved - but it basically has to go ahead, since new stock is necessary.

............

I can see the uncertainty around Nationalisation causing a pause just like the one Roger Ford reported on when Privatisation came along.

What you can be certain of is uncertainty.

It is not really surprising though is it? Not when in the past 10 years we have seen TOCs order an exceptional amount of new rolling stock across the country.

I could see us getting to a point where rolling stock orders might dry up for little a bit of time but I guess at the end of the day that is a risk when you do full fleet replacements like TfW and GA did and have no national rolling stock strategy.

Yes after the large gap in orders due to Privatisaton there came an unseemly boom in orders. We could have slowed that down a little which might have made the overloaded manufacturers more price competitive.

I remember reading of the 1950s rush to build DMUs. There then came a decade or so of very few DMUs being built which then meant in the 1990s there were a lot of DMUs needing replacement. We seem to be entering that phase again only perhaps it should be happening later - in the 2030s ?. But nstead the UK will put of ordering DMUs until it is too late to built fewer per year but for more years. The UK will never learn.

There's vast swathes of railway that will likely not see electrification in any form for decades, if ever, and many of those lines operate as self-contained routes. Providing bi-modes for those lines would result in trains that would be more expensive to procure and to maintain and operate. There might be better arguments for producing a modular DEMU that could have it's traction package modified or swapped-out out should things change but a cynic might put that beyond what the current crop of politicians and civil servants are capable of considering.

The West of England line might be one which could benefit from diesel/3rd rail bi-modes but I can't see that being considered possible these days (the WoE really needs pulling up and re-building from Salisbury to Pinhoe but that's another issue).

I agree. If the UK wanted to avoid pure diesel trains and have Bi-Modes instead then a lot more electrification should have happened over the last decade or so.