400 jobs at risk as Alexander Dennis seeks to ‘consolidate' bus manufacturing
The Scottish-headquartered company said it is looking at 'consolidating its UK bus body manufacturing operations' in Scarborough, North Yorkshire.
This would mean its manufacturing facility in Falkirk – which Alexander Dennis said had 'already been reduced in recent years' – would close.
In addition the firm said the production lines in Larbert, where it also has its global HQ, would be suspended when current contracts are completed.
The GMB Scotland union said the move was a 'hammer blow' for communities 'already reeling' from the closure of the nearby oil refinery at Grangemouth.
Senior organiser Robert Deavy said: 'If the company is reviewing its future operations, it must do so with an open mind and a determination to save jobs, not shed them.
'We will do everything in our power to secure the future of Alexander Dennis in Falkirk, but so must the company and so must ministers.'
Alexander Dennis said the changes would lower costs and increase efficiencies.
But it added up to 400 jobs – about 22% of its workforce – would now be at potential risk of redundancy.
Scottish Deputy First Minister Kate Forbes said: 'This will be a hugely worrying time for the workforce at Alexander Dennis, their families and the wider community.'
She said the Scottish Government has in recent weeks 'engaged extensively' with the company and its parent firm NFI to 'understand the issues and ensure that every possible avenue is explored to mitigate the need for redundancies'.
Ms Forbes and Scottish First Minister John Swinney have been involved in these talks, along with representatives from Scottish Enterprise, Transport Scotland and the UK Government.
Vehicles for the 'Bee Network' of buses in Greater Manchester were built by Alexander Dennis (Andrew Milligan/PA)
Ms Forbes pledged: 'The Scottish Government will continue to explore any and all options throughout the consultation period to allow the firm to retain their hard-working employees and manufacturing and production facilities at Falkirk and Larbert.'
She added that in the event of job losses, the Scottish Government would provide support through its Partnership Action for Continuing Employment (Pace) initiative.
Paul Davies, Alexander Dennis president and managing director, said the firm is proposing a UK manufacturing strategy 'to underpin financial sustainability and lower operating costs in the face of changing and challenging market dynamics'.
With Alexander Dennis dating back to 1895, Mr Davies stressed bosses 'firmly believe in our people, products and business'.
But he added: 'We must take significant action to drive efficiency to allow our operating model to be competitive.
Both the Scottish First Minister John Swinney and his Deputy First Minister Kate Forbes have been involved in talks over the future of Alexander Dennis. (Jane Barlow/PA)
'It is extremely regrettable that as part of this, we must place jobs at potential risk of redundancy and propose to cease manufacturing operations at some of our facilities.'
Mr Davies said this is necessary because 'the stark reality is that current UK policy does not allow for the incentivisation or reward of local content, job retention and creation, nor does it encourage any domestic economic benefit'.
He added: 'We have warned of the competitive imbalance for some time and would like to see policy and legislative changes that incentivise the delivery of local benefit where taxpayer money is invested.
'We strongly believe funding that supports public transport should lead to investment in local jobs, domestic supply chains, technology creation and a recurrent tax base.
'It is our hope that the forthcoming industrial strategy will provide reassurance that there is value in manufacturing within the borders of the UK and we remain hopeful of policy and legislative changes that increase the UK's focus on support for domestic manufacturing.
'Our new strategy would allow us to respond appropriately to increase local production if structural changes are made.'
Scottish Secretary Ian Murray said part of the problem at Alexander Dennis was because SNP ministers had 'not ordered enough buses' from them.
He said the Scottish Government had ordered 44 buses from the firm, contrasting this with the 200 buses ordered by Greater Manchester Mayor Andy Burnham.
Mr Murray added the restructuring plans were a 'huge shock for the local area' but said the 45-day period that would now follow gave 'time to see if there is ways in which we can help'.
Speaking for the UK Government, he added: 'We've been encouraging the Scottish Government to look at a furlough scheme for Alexander Dennis employees in order for us to be able to buy a little bit of time to work through some of the problems that the company have got.'
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