Financial close for Intercity Express Programme

The UK’s Department for Transport (DfT) and Agility Trains have announced that they have reached financial close for phase two of the £5.7 billion Intercity Express Programme (IEP).

The consortium has confirmed the final chunk of funding for 65 new Class 800 trains being built for the East Coast main line to replace the ageing Class 125 and 225s currently in service.

Hitachi is delivering 866 electric and bi-mode carriages altogether for the Great Western and East Coast main lines.

The European Investment Bank confirmed that it would be loaning £235 million to the scheme. Further financing has already been signed off from the Japan Bank for International Cooperation (JBIC), Bank of Tokyo Mitsubishi UFJ (BTMU), Development Bank of Japan (DBJ), HSBC, Lloyds, Mitsubishi Trust, Mizuho, Sumitomo Mitsui Banking Corporation (SMBC), Société Générale and Crédit Agricole.

Hitachi Rail Europe will design, build and maintain the new fleet at its sites in Newton Aycliffe and Doncaster over the course of the 27.5-year contract term.

Martin Garrett, chief executive officer of Agility Trains East, said: “We have been delighted with the response of financial institutions to the financing of this important project.

“With this key milestone achieved we will now be able to deliver the step change in reliability, capacity and comfort that the IEP will bring to rail passengers on the East Coast Main Line.

“Hitachi Rail Europe has announced separately the construction of a new train factory in the UK and with this new contract now fully funded this will bring extensive opportunities for British companies in working with Hitachi to deliver the trains.”

Alistair Dormer, Hitachi Rail Global chief executive of Hitachi Ltd, said: “I am delighted by today’s news of financial close for the East Coast Main Line fleet of trains. Hitachi Rail is once again demonstrating its commitment to the UK through its investment in this programme.

“The high level of interest by some of the world’s leading banks is ample proof of the confidence in the IEP and confidence in UK rail.”