Following the launch of Hitachi’s new commuter train, the AT200, Alistair Dormer, global chief executive for rail, Hitachi, talks about the company’s targets in the UK and Europe.
Hitachi is an ambitious company. In a short space of time the Japanese multinational has established itself at the top table of rail suppliers in the UK.
Hitachi is building up an image as the Toyota or Nissan of the rail industry, creating jobs and reviving the diminished art of train building in Britain.
Although Hitachi has been building trains in Japan for around 90 years, the name hasn’t always been synonymous with rail in the UK. ‘When I joined Hitachi, most people said why are you joining a TV company,’ said Alistair Dormer, who in March was given the task of leading Hitachi’s global rail business after 11 years with the company.’
For Alistair, moving the rail headquarters away from Tokyo is a strong message to the marketplace that Hitachi is a global player. With a factory under construction in County Durham, the company is now looking to expand into Europe. Although best known for its rolling stock, specifically its high-speed Shinkansen, Hitachi is also eyeing up opportunities for its signalling and traffic management technology.
Says Alistair, ‘We’ve got a little bit of an entrepreneurial spirit here within Hitachi Rail Europe and Europe is the biggest rail market in the world, so if you’re going to grow your business you may as well look at the biggest market in the world.’’
Alistair joined Hitachi in 2003 from Alstom where he had spent two years.
At 18 he joined the Royal Navy as an engineering apprentice and served in the Falklands War. Dormer was aboard HMS Sheffield when it received a direct hit by an Exocet missile fired from an Argentinian jet. Twenty of his shipmates died in the attack.
Dormer went on to spend 12 years at defence company BAE. He later made the transition from selling fighter jets to selling trains.
When Alistair arrived at Hitachi, the company’s UK office had no rail products in use on the network and just three Japanese engineers.
‘In one respect it was a big gamble because having no business at all, right in the spotlight I mean, you achieve or you don’t, it’s as black or white as that,’ says Alistair.
Initially it was a challenge for Hitachi to convince Network Rail that its products could work on the UK network. Hitachi fitted its traction package to a Class 310 it had borrowed from HSBC Rail in order to try and demonstrate what it could offer to the marketplace. It was an expensive gamble, but Alistair believes its success was what opened the door to Hitachi winning the Javelin train contract.
With the Intercity Express Programme (IEP) now underway, Alistair has a team of more than 200 to lead. That number will rise substantially if Hitachi stays on track to grow in the continent as it hopes.
There is then the team several thousands of miles away in Japan, who in April received a personal promise from Alistair that he would return speaking fluent Japanese within the next two years. He is now receiving intensive lessons.
Building trains for Europe
Whatever some bands and artists go on to accomplish, that first number one can sometimes hang around their necks like a platinum-selling lead weight. For Hitachi, being the bullet train manufacturer could be something of a mixed blessing.
On 21 July, Hitachi launched its AT200 commuter train and AT100 metro platforms in London.
Hitachi rolling stock is the lifeblood of commuter traffic in Tokyo but in Europe it is untested. Could Hitachi’s reputation for high speed actually hold it back?
‘I think there is an element of that,’ says Alistair. ‘Probably that was reinforced by the fact that the first contract we won was the Javelin which had got a nice pointy nose on it. Now we’ve won IEP which again has got a pointy nose on it.
‘People haven’t been able to see our commuter products in the UK which is why it is very, very important we do get people to see the AT200 so they can actually see what we’re capable of.’ ‘It’s kind of not a bad thing. There’s a halo effect… because it is a fantastic train and a fantastic design. But clearly our bread and butter is commuter trains,’ says Alistair.
The AT200 is Hitachi’s ‘next generation’ commuter and suburban train, designed to challenge the dominance of the Electrostar and Desiro in the UK and look to take advantage of the huge market in Europe for electric multiple units (EMUs). Hitachi has already submitted the AT200 into bids for the new EGIP rolling stock which will be procured through the ScotRail franchise.
‘Going back sort of seven or eight years, it was quite difficult to break into the commuter market because the Electrostar and Desiro were very, very strongly placed,’ says Alistair.
‘What we decided to do is rather than wait for an order, actually get on and design it now. So we’ve been working on the design for over a year. We’ve used UK companies to do it, just the same as we’ve done with IEP with the significant UK content. So the interior design has all been finished.
‘We’re making the first mockup so that will be there for everyone to see and touch and sit down, see what they like, what they don’t like.
‘We’re now at detailed design stage, we’ve got our supply chain onboard, we’re ready to go.’
Newton Aycliffe is being built with Europe in mind. It will have the capacity to have simultaneous production lines for IEP and the AT200. It also has the capability to build double-deck rolling stock.
Says Alistair, ‘The first masthead is get it open, get the workforce trained, hopefully by then we’ll have a commuter order anyway.’
When Hitachi was announced as the winner of IEP, there was a level of suspicion about what it would mean for the UK. Even when Hitachi confirmed the construction of the Newton Aycliffe site many dismissed it as a ‘screwdriver factory’ where kit trains would arrive from Japan and just be stuck together with no technical engineering involved.
‘Unless you’ve got a hundred years of train building in the UK, you’ll never be accepted as a true UK builder,’ says Alistair.
Since then, Alistair believes the company has managed to dispel those concerns.
‘We’ve been welcomed by the North East with open arms. We’d talked about it quite a while ago and until you can physically see something, it isn’t really real. Now a lot of local companies are involved in the construction, I mean 96 per cent of the spend is on companies within a 50-mile radius of the factory site.
‘Now the factory is actually going up, people are like ‘wow, it’s happening’.’
He went on, ‘It’s real now, and I think that will help us a lot in Europe as well because when we can actually bring customers over to the factory and they can see our products and they can see it being built, and they can see the quality of our workforce, the quality of our manufacturing, then that will be a real boost.’
The traditional landscape of train builders in Europe looks to be changing, particularly with Alstom on the verge of a major restructuring.
‘A lot of people have said ‘oh aren’t you worried about it’ and no, personally I’m not,’ says Alistair, speaking about the bidding war between Siemens and GE for Alstom.
‘I think when you get a substantial change like that in the marketplace it does create opportunities.’ Opportunities that Hitachi will be all too happy to snap up.