Survey of Bombardier suppliers shows substantial threat to
thousands of jobs
6 September 2011
Bombardier/Siemens supply chain survey by
Survation for Unite: Findings see thousands of jobs potentially at
risk
Survation interviewed 125 companies (primarily their managing
directors) operating in the UK that supply Siemens and/or
Bombardier for train manufacture. The companies were interviewed
about the potential impact to their business of Bombardier losing
the Thameslink contract to Siemens - on the basis that rolling
stock would be manufactured mainly in Siemens’ facilities in
Germany versus Bombardier’s UK plant. The interviews were conducted
between Friday 26 August and Thursday 1 September.
The sample was intended to represent a cross-section of UK
businesses involved in supplying services, components and parts to
the global train manufacturing industry. Seventeen observations
were collected via a web-based invitation survey with the remainder
(108) via telephone interviews. The questions were the same for
both methods.
Key findings
- Almost half of the suppliers interviewed rely on Bombardier for
at least 5 per cent of sales; while at the other extreme 6 per cent
of those interviewed rely almost entirely on Bombardier.
- Only 24 per cent of UK suppliers interviewed by Survation
currently supply Siemens, indicating the companies are poorly
positioned to provide Siemens with future train manufacture. The
shortfall in business from the Bombardier plant in Derby not
manufacturing Thameslink trains would, in many suppliers’ views,
not be supplemented by orders from Siemens.
- 40.59 per cent of the companies interviewed by Survation plan
to execute job losses. Indeed, some suppliers have already lain off
workers. 55.6 per cent of those that plan job losses have done so
or plan to do so within the next three months. Of those expecting
job losses 73.7 per cent expect them within the next six months.
Despite the government looking to review the UK’s procurement
process in the light of recent job losses suffered at Bombardier,
the announced one-year delay to the Crossrail contract is unlikely
to help the employment picture as many jobs will already be
lost.
- When asked: “How will they be affected by Bombardier losing the
Thameslink contract to Siemens?” responses ranged from “none” to
“substantial”, and in some cases complete closure. Survation found
that of the total sample 19.2 per cent of businesses believed it
would have a substantial negative impact on growth and almost a
third (32 per cent) believed it would have a substantial negative
impact on sales.
- Businesses holding one or both of these opinions (a
substantially negative impact on growth or sales) could be found
nationwide, from Abadare to Witney. While the greatest number of
impacted companies were found in Derby – (the UK’s rail production
hub) – Birmingham, Nottingham and Chesterfield were ranked
highly in the survey in terms of the number of businesses facing
job losses. Only one respondent believed Bombardier’s loss of the
contract to Siemens would have a positive impact.
- Overall, small and medium sized enterprises (SMEs) will likely
see the largest impact on business if Bombardier loses the
Thameslink contract. These companies face higher job losses as a
proportion of business and are likely to execute job losses in a
shorter period. Almost two thirds (65.6 per cent) of SMEs Survation
interviewed do not currently supply Siemens, compared to the survey
average of 53.6 per cent.
Damian Lyons Lowe, CEO of Survation, commented: “Our previous
survey work relating to Bombardier looked at the striking local
political impact in Derby of the government decision to award
preferred bidder status to Siemens over Bombardier with its main
manufacturing plant in Derby. This survey has shown there will also
be a meaningful impact on jobs and growth nationally, particularly
to small and medium sized companies.”
Unite general secretary, Len McCluskey, said: "This powerful
survey is a devastating indictment of the government's decision on
Thameslink. It is absolutely scandalous that the Tory-led
government did not stop to examine the social and economic impact
of not choosing Bombardier for the Thameslink contract.
"From Aberdare in Wales to Cameron's own Oxfordshire constituency
of Witney, countless small and medium sized companies will pay the
price for this decision. Some companies are even having to lay-off
workers now, and a third believe the decision will have a
substantially negative impact on their business.
"The fact that fewer than one per cent believe they will benefit
from the government's preferred bidder is a devastating indictment
of the government's manufacturing strategy. The Department of
Transport has openly admitted it failed to carry out an impact
assessment on the consequences of not awarding the contract to
Bombardier.
"As this survey shows it is not just about 3,000 skilled jobs in
Derby there are thousands more which depend on Bombardier up and
down the country."
ENDS
For Survation media requests please contact Romilly Dennys or
Arpana Ghandi at Media Intelligence Partners on 020 3008 8149 or
07786 221309 or email romilly@mippr.co
For Unite please contact Ciaran Naidoo 07768 931 315 or ciaran.naidoo@unitetheunion.org
