The rail plant sector is heading into the perfect storm

Adam Richardson, Chairman at Quattro Group and AB2000

The Rail Plant Association (RPA) has recently released a discussion paper entitled ‘The UK rail plant industry in 2019 – coming off the tracks?’ which calls for action from the Government and Network Rail to come up with solutions to help secure the industry. Among its calls for action include a Williams-style review looking at the industry as poor procurement, planning, a download in trade anticipated for 2 years and tier one contractors looking at financial risk, is creating the perfect storm for the collapse of RRV supplies and standards.

These are concerns Quattro’s been highlighting for the last three years – having published two White Papers on this issue prior to the RPA.

For years there has been a fundamental problem with the structure of the RRV operations – there are generally two bad trading years and eight good years. Businesses have not planned their operations around this and we are in great danger of suffering until the next big spend arrives in September 2021. Some companies are heavily in debt and are unable to maintain their machines to certified standards – counting on the big cheques promised in the arrival of CP6. They’ve only just been told little more is coming for nearly 2 years.

Earlier this year, Quattro initiated a lobbying of Parliament in England, Scotland and Wales to make the Rail transport community understand the problems RRV operations are having and the consequences of not acting. These problems won’t be going away until late 2021.

Let’s say nothing changes and businesses go bust, highly qualified staff are lost and by 2021, when spending will increase, we could be left with 20% less machines to operate than in 2011. This at a time when over the next 10 years there will be the highest investment in rail there has ever been. The consequences of which are if the machines don’t operate, then the work can’t be done and the network will be left frustrated, as the machinery is not there.

We need to lobby the Government to make sure they are fully aware of the situation we find ourselves in. We also need to make sure we invest in machines and training people – this is an industry with long-term security with major investment and opportunities in the near future. We need the investment now so the machines are working and able to deliver come 2021. Companies like ours should look at between £5 million and £10 million of investment in new working machines. These are specialist machines – each machine takes 2 years to build.

I welcome RPA’s report and would echo the importance and seriousness of the issues we are facing. As a sector we need to lobby Government, looking at the industry, concentrating on efficiency, work patterns and the commissioning process. But most of the major RRV suppliers have had a few exceptional years and expected the downturn as we traded from CP5 to CP6, so this isn’t really unexpected – just longer and harder than anticipated with major demand coming up in 2 years’ time.

As individual businesses we need to invest in machinery and training. The rail plant sector is an amazing sector to be involved in. The times will be tough for the next two years, but the hard work and pain will be worth it come the next investment in 2021.