More than 1,400 jobs are to be lost at Britain's last train making company, Bombardier.
The axing of posts follows the government's decision to award a big carriage order for the Thameslink route to Siemens of Germany rather than to Derby-based Bombardier.
The company said the job cuts would affect 446 permanent staff at Derby and 983 temporary staff.
A consortium led by Bombardier had been competing with one led by Siemens for a contract for 1,200 new carriages as part of a £6 billion upgrade of the Thameslink route, which runs from Bedford to Brighton through London.
Last month the government announced that Siemens would be the preferred bidder for the contract. Announcing the winner, rail minister Theresa Villiers said the bid by Siemens, which will build the new carriages in Germany, represented the “best value for money for taxpayers” and stressed that the contract would create up to 2,000 new UK jobs.
But it was vital for Bombardier's future that it won the Thameslink contract as most of its other contracts are due to finish in September this year. Bombardier does have a Tube train contract that will go on until 2014 but this will only support a few hundred jobs at Derby.
Bob Crow, general secretary of the RMT transport union, said: “It's a scandal that the government is colluding with the EU in a policy of industrial vandalism that would wipe out train building in the nation that gave the railways to the world.
“German rail giant Deutsche Bahn awarded a £5 billion fleet contract to German company Siemens and no-one batted an eyelid but when it comes to British skilled manufacturing jobs getting support from this government all we get is a pack of excuses and they stand exposed as totally impotent in light of the Bombardier/Thameslink scandal.”
The Unite union added its condemnation, saying that the government’s “misguided” decision to exclude Bombardier from the contract to build carriages for the Thameslink project was now becoming a reality.
Workers at Derby are now completing orders for London Underground carriages and for diesel trains for the London Midland main line train company.
Most of this work will be completed by the end of September this year.
Francis Paonessa, president of Bombardier’s passengers division for the UK, said: “The culmination and successful delivery of these projects and the loss of the Thameslink contract, which would have secured workload at this site, means that it is inevitable that we must adjust capacity in line with economic reality.”
He went on: “We regret this outcome but without new orders we cannot maintain the current level of employment and activity at Derby.
“Over the next 90 days together with employee representatives we will work with individual employees to ensure the best possible outcome for our people.”
Transport Secretary Philip Hammond said the job losses were “by no means” all attributable to the decision not to award Bombardier with the Thameslink order.
“Bombardier is extremely disappointed not to win the Thameslink contract and we are extremely disappointed that they didn't win it,” he said.
“But let’s if I may, just put this in context - Bombardier has had a fantastic run of success, they have been building train orders for all sorts of companies over the last few years, they have geared up their labour force.
“They always knew that when those contracts came to an end, they would have to make some job losses.
“Indeed, the company wrote to me back in May and said that whatever the outcome of the Thameslink contract, regardless of whether they won or not, they would have to make 1,200 redundancies simply because of all the other contracts coming to an end.
“Of course, the Thameslink decision is bad news for Bombardier but the job losses being announced today are by no means all attributable to that decision.”
He said the Thameslink contract procurement process had been started by the previous Government.
“It has fallen to us to announce the result of that competition but actually we had no ability to influence the outcome of that decision,” he said.
“The simple fact of the matter is under the criteria that the previous government set out in the contract, Siemens were the winner of that competition and under European procurement law we had no choice but to announce them as the preferred bidder.”