The government has confirmed that the winners for the £6.6 billion HS2 contract will be a UK industry consortium. Carillion, Costain and Balfour Beatty will build the bridges, tunnels and embankments for the first phase of the project between London and Birmingham. It is predicted that the contract will support 16,000 UK jobs. The firms have appointed accountancy firm EY to support a strategic review of the business. HS2 is the £56 billion project expected to provide “desperately needed new seats and better connect [our] major cities, HS2 will help rebalance our economy," according to Transport Secretary Chris Grayling. The first trains are not expected to enter service until 2026, but once up and running the government forecasts that it will create a further 100,000 jobs around HS2 stations.
"Government confirms plans to extend from Birmingham to north-west, East Midlands and Yorkshire. HS2 trains set to carry more than 300,000 people a day – freeing up thousands of seats and creating extra local services."
The expected total value of these contracts including both Stage 1 and Stage 2 (the full construction phase) is currently estimated to be worth £6.6 billion. Stage 2 will commence in 2019 and, along with Stage 1, is expected to support 16,000 jobs across the country. In addition, they are expected to generate 7,000 contract opportunities in the supply chain, of which around 60% are expected to go to SMEs. Transport Secretary Chris Grayling said that the development of HS2 will now begin “while continuing to ensure affected communities get appropriate support and are treated with fairness, compassion and respect.”
The contracts to design and build areas of the high speed rail line have been split into three groups: south, central and north.
Carillion, which last week issued a profit warning and announced the immediate departure of its chief executive, has won two "lots" within the central area. Its share price rose by 7.7% to 60.5p on Monday but it has fallen by more than 76% over the last 12 months according to the BBC.
David Higgins, Chairman of HS2 Ltd, said: “This is a huge day for the HS2 project and for the country. These contracts will support 16,000 jobs here in Britain and will create opportunities for thousands of SMEs.”
Preparatory works are already underway, with main construction work starting in 2018/19 following a period of detailed design work.
The companies who have won the contracts to design and build the first phase of HS2 are:
- Euston Tunnels and Approaches – SCS JV (Skanska Construction UKLtd, Costain Ltd, STRABAG AG)
- Northolt Tunnels – SCS JV (Skanska Construction UK Ltd, Costain Ltd, STRABAG AG)
- Chiltern Tunnels and Colne Valley Viaduct – Align JV (Bouygues Travaux Publics, VolkerFitzpatrick, Sir Robert McAlpine)
- North Portal Chiltern Tunnels to Brackley – CEK JV (Carillion Construction Ltd, Eiffage Genie Civil SA, Kier Infrastructure and Overseas Ltd)
- Brackley to South Portal of Long Itchington Wood Green Tunnel – CEK JV (Carillion Construction Ltd, Eiffage Genie Civil SA, Kier Infrastructure and Overseas Ltd)
- Long Itchington Wood Green Tunnel to Delta Junction and Birmingham Spur – BBV JV (Balfour Beatty Group Ltd, VINCI Construction Grands Projets, VINCI Construction UK Ltd, VINCI Construction Terrassement)
- Delta Junction to WCML Tie-In – BBV JV (Balfour Beatty Group Ltd, VINCI Construction Grands Projets, VINCI Construction UK Ltd, VINCI Construction Terrassement)
HS2 stations at Euston, Old Oak Common and in Birmingham will be central to HS2 and the work needed to develop designs is also well underway. Last week, both the invitations to tender for the station design services contracts for all four Phase One stations and the invitation to participate in dialogue for a Euston Master Development Partner were released to shortlisted bidders.
Other related content you might be interested in: