Japanese firm Hitachi Rail ups sticks and moves to County Durham, creating 1,800 jobs, after winning massive new UK contracts

Hitachi's High Speed trains at St.Pancras International station in London, Britain 20 March 2014 (EPA)

The manufacturer of the first Japanese bullet train is to move its global headquarters to the North East of England from Tokyo in a move that could create thousands of new jobs.

Unions gave a cautious welcome to the news which will see Hitachi Rail relocate to County Durham – the birthplace of the world’s first public steam railway line.

The Japanese company recently won £5.8bn contracts as part of a consortium to build a new generation of inter-city trains for both the Great Western and East Coast mainlines. In 2012 another division of the company bought the rights to a £700m contract to construct nuclear power plants in the UK.

Its new rolling stock factory in Newton Aycliffe is already being built and is expected to open next year employing 730 people.

Up to 1,800 people could eventually work at the site under Briton Alistair Dormer, who will now lead the global operation as chief executive.

Hitachi is also eyeing potential multi-billion pound contracts for the proposed HS2 high speed rail link as well as bidding to build trains in Germany despite claims by rivals, including Derby-based Bombardier, that they are effectively excluded from entering the lucrative Japanese market.

Labour and the Tories clashed over the announcement with both seeking credit for the decision which, it was claimed could be put in jeopardy if Britain voted to leave the European Union in a future referendum.

Transport Secretary Patrick McLoughlin said it was an “incredible vote of confidence in a growing Britain”.

He added: "Nothing says that better than the company that built the first bullet train putting its HQ here to sell abroad, alongside a new factory and new jobs in northern England.

"This is just the sort of growth we want to see more of as we invest in rail and build HS2.”

Shadow transport secretary Mary Creagh defended Labour from Tory attacks on its stewardship of Britain’s railways. “If it was so dismal I don't understand why Hitachi have moved here because of the InterCity express programme. “But we'll move on about that - that's actually a Labour decision that caused that announced today,” she told the Commons.

Mick Whelan, general secretary of train drivers' union Aslef, said: “We welcome this news because it will create much-needed jobs in the North East of Britain.

“I would rather it was a British company creating jobs and winning orders from the Department for Transport, but it is good news. We want investment, in trains and carriages as well as in our infrastructure, to build a better railway for everyone in Britain.”