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KiwiRail to sell Dunedin's Hillside workshop

Thursday 19th April 2012

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KiwiRail plans to sell its Hillside workshops in Dunedin after the state-owned railroad awarded contracts for new rolling stock to overseas-based manufacturers rather than use its own engineering facilities.

The railroad eliminated 44 jobs at Hillside last year and has said the facility couldn’t compete with overseas suppliers.

“KiwiRail’s decision to not bid for either the $500 million contract for Auckland’s new trains or for 500 flat top wagons was resoundingly rejected by Dunedin workers, business leaders, the city council and others as taking a very short-sighted view of procurement,” said Wayne Butson, general secretary of the Rail and Maritime Transport Union.

“If government procurement settings do not support local industry, then we simply won’t keep good manufacturing jobs in New Zealand,” he said.

A spokeswoman for KiwiRail said it would issue a press release about the sale shortly.

In February, KiwiRail said earnings in the year ending June 30 would miss the target in its statement of corporate intent because improved freight volumes were being offset by challenges in the remainder of its businesses.

Earnings before interest, tax, depreciation and amortisation are expected to be $105 million to $115 million in the year ending June 30, compared to the SCI target of $139.5 million, the Wellington-based company said.

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