As he was being led into the room by two communications executives, Dormer didn’t exactly look enthusiastic, but over the course of the interview came the realisation that the slightly dour expression belies his dry, witty, and essentially no-nonsense personality.
To my comment that we’re the same age, Dormer responded by telling the story of how, before a recent appearance on Sky TV the make-up artist left him looking like an ‘extra from Kiss’. ‘The scary thing is that a year ago when we did Sky they just kind of went like this’ and he gestured with a brush-stroke across his face, ‘and that was fine. This time it took about ten minutes’.
At the time of the interview, just as he was about to take on his promotion, Dormer seemed calm and confident. I put it to him that Lord Deighton’s trumpeting that Hitachi Rail’s decision to make London the headquarters of its global train business could ‘signal the start of a UK rail industry revival’ was heavy stuff was it not? Did he feel the pressure of that kind of comment? ‘I think there’s been a railway revival going on ever since privatisation. I mean Hitachi came here in 1999 to challenge for rolling stock deals and it took us six years to be successful. I joined in 2003, and since then we’ve won the Javelin deal, a few other smaller deals and now the IEP, so the UK is a major, major market for us.’
Aside from the obvious reasons why basing Hitachi’s Rail Systems HQ in the UK makes sense – the multi-billion pounds worth of contracts here and the £82 million new factory – Dormer admits it’s a fairly unusual move for a Japanese firm. ‘The decision was made in Japan and one of the reasons is that we want to bring our decision making closer to customers. Most of them are in Asia but we’re very ambitious to expand – not just in the UK but in Europe, Latin America and the Middle East. So it’s a significant step for a Japanese company to put its headquarters into Europe, and to have European leadership of the team. It’s a great compliment to the management we have here; we’ve been very successful in growing the business so the remit now is to accelerate that growth and take it even further. The railways are seen as a symbol of how we’ve gained international success, so to me it’s an entirely logical decision.’
What of comments that Hitachi Rail is still essentially Japan based and controlled ‘Not from April 1st it’s not’ said Dormer.
I wondered what he likes about London? ‘I work here’ he replied, keeping a straight face while we all laughed. ‘London is one of the great financial centres and there are lots of companies that have links globally so you can make that supportive connection with them, and it wouldn’t be logical for us to put our HQ in Paris for example when most of our resources are going to be here.’
Best foot forward on HS2
The company has been working with HS2 Ltd for a couple of years now advising on the key interfaces between the train and infrastructure systems. Does Dormer think that puts Hitachi Rail at an advantage? ‘No, because HS2 Ltd has been consulting with all the major players to see what products and innovations they have in terms of high speed. Clearly we’ve been building very high speed trains for 50 years – longer than anybody else – and Japan is an island of a similar size to Great Britain so they worry about the same issues, such as the environment, noise and the cost of actually putting the railway in. In Japan the tunnels are quite a lot smaller than in mainland Europe because there are so many of them, but there will be quite a number of tunnels for HS2 so our long experience has I think been helpful. However, I’m pretty sure the ITT will be all-encompassing to attract as many bidders as possible, and it will be highly competitive. So yes, for sure we will be putting our best foot forward.’
Does he think HS2 will go ahead? ‘Yes I think it has to, and if you’re going to build a new line you might as well build it fast. But to me, speed is the secondary benefit to capacity. I think people regard HS2 as being a sort of stand-alone railway, it’s not, it’s an additional railway that will connect to the rest of the network.’ And suddenly we moved into a whole other raging debate – whether HS2 offers enough interconnectivity. ‘I think those kind of things will come through,’ said Dormer, ‘But for example we’ve seen in Ashford, our Javelin trains on HS1 have transformed people’s lives and the town has experienced an economic boon from that. Ebsfleet had huge plans that were put on ice during the recession, but now the chancellor has announced a new garden city there and he wouldn’t be doing that if it wasn’t a phenomenal railway.’
Speaking of HS1, I wondered what Dormer thought about it not being connected to HS2? ‘Em, that’s a complicated question,’ he said after some pause. ‘My personal view is that it would be better if it was. But then again I don’t live in Camden, and I’m not entirely sure of all of the complexities of planning around how you would get that line into St. Pancras. But the decision has been made that it goes into Euston and I think what is very important is that it’s a very quick transit time from Euston to St Pancras, I mean it’s not very far away, what is it 3-400 metres? But we need some innovation in that area I think.’
Further plans for UK
Given the stated intent to ‘vigorously develop’ its business, no doubt Hitachi Rail has its eye on more contracts in the UK – the firm is bidding to make trains for Scotrail. ‘Yes we do’ admits Dormer. ‘I don’t want to go into specifics at this point but there is the electrification programme, and whenever you get a franchise change it stimulates competition for new stock versus cascaded lease stock; we’ve got relationships with all the major operating groups and we’re talking to them in terms of what their needs are. We’ve designed a – I hesitate to use the words ‘brand new’ because all of our designs are evolutionary – commuter offering which is on the market now, and we’re looking to offer that as franchises change. Obviously there might be a bit of a delay while we’re seeing direct awards before we get into the really big round of refranchising.’
So I put it to Dormer that the company’s timing has been good. ‘I hope so. It’s all part of our cunning plan.’ We all laughed and this time he allowed himself one.
In Europe, Hitachi Rail has pre-qualified for two contracts in Germany, having failed in a previous attempt to enter the market, and will find out later this year whether it has been successful in a bid to provide train traffic control systems to Sweden’s rail network. Are there further plans? ‘Again I don’t want to go into specifics’ said Dormer. ‘We are bidding at the moment, and we’ve spoken to all the major players. They are positive about us not just from a rolling stock point of view but from a signalling and traffic management one, so it’s a big challenge and I don’t underestimate that. It took us five years to really understand the UK market and how it works. We opened our office in Berlin two years ago and we’re on that journey now.’
Go and do the same in Japan
Hitachi rivals Bombardier and Siemens once lobbied against it being allowed access to the German market, arguing that the Japanese market was closed to foreign bidders. I wondered if he thought they were still disgruntled? Dormer gave a knowing smile. ‘I was in the European Union yesterday actually and that’s quite an interesting topic. It depends on how you look at it because if you use Hitachi as an example, in the UK the procurement methodology is completely different from Japan. We have multiple franchises, we’ve got Network Rail, the ORR, the DfT, independent notifiable bodies, ROSCO’s…and to come in from Japan, which is a very mature market, you’d kind of think you’d landed on Mars. So rather than sulking about it, we set up an office, we hired people, we invested a lot of time and effort with UK consultancies and then had the situation in 2003 when the customer said: ‘How do we know your technology is going to work over here, because our track’s not as good and our power supply’s not as stable?’ And rather than just say it’s all too difficult, we brought our traction equipment here and fitted it to an old BR train. We got our safety approvals from NR to prove our technology was compatible, reliable, and as fantastic as we said it was, and only then, after spending millions doing that, were we in a position where we could win a contract. So my advice to anybody who wants to go and do business in Japan is ‘Go and do the same’.
Describing Japan’s rail market as ‘tough but good’, Dormer cited Thales’ contract to design a communications-based train control system for East Japan Railway’s Joban Local Line in the greater Tokyo area. ‘It’s the first non-Japanese company to win a major signalling deal in Japan, but no Japanese signalling company has ever won a deal in Europe. We intend to be the first.’
‘You also have companies such as Knorr-Bremse that supply brake systems for the Shinkansen bullet trains,’ said the communications officer. ‘Yes, in fact we were looking at the list of European companies yesterday,’ agreed Dormer ‘and it’s massive, and in fact quite a high number of UK companies, which surprised me, have been very successful in Japan. So when you look at the number of suppliers Japan has from Europe, it’s probably in the 100’s. If you look at how many Japanese suppliers are in Europe, it’s probably Hitachi, and maybe Mitsubishi. People got excited after we won the IEP deal – and it is a huge deal – saying, you know, that it’s unbalanced. The reality is it’s not. The other interesting thing is that in Japan there’s the Rolling Stock Association of Japan, membership of which includes Thales and Siemens. We’re not in UNIFE. We’d like to be.’
Far from the days now of Hitachi’s former chief executive for Europe, Sir Stephen Gomersall’s strongly worded telegram to Robin Cook that Japanese firms were on the brink of pulling their factories and their money out of Britain unless they were given promises that we would join the euro, Dormer has made no secret of the fact that Hitachi Rail would prefer the UK to stay in the EU. ‘Look, there is a referendum and we’re not the electorate so we can’t know which way it’s going to go. What we’re on record as saying is that we would prefer the UK to stay within Europe, and if the UK decides to leave Europe, our message to the UK government would be that it’s very important we don’t have any tariffs or barriers between the UK and Europe, because we are investing in the UK not purely to win business here, we want to win business in Europe and therefore we don’t want to see our chances of that being damaged.’
Building in UK for Europe
One of Dormer’s stated intentions is that he wants to build in the UK for the rest of Europe and the answer to that lies in the mists of time apparently. ‘15 years ago the UK needed a lot of investment so there were plenty of opportunities, and for a Japanese company operating in an English environment is much easier than in a Swedish one for example. The market was seen as very transparent and fair, so it’s been an evolution. Javelin was step one, and we wouldn’t have won the IEP if that wasn’t delivered on time, wasn’t exceptionally reliable, and customers weren’t delighted with it. The IEP will be no different and therefore we see growth coming off the back of that.’
As for building trains in the north east, Dormer sees it as a ‘Great idea. Because it’s an area that really needs economic stimulation and I think private sector jobs in the region is good news. The only question, asked by others and not necessarily ourselves, is, ‘Can we get the right skills?’ Personally I’m very confident we can. When we established our maintenance facility in Ashford back in 2008 we hired 100 people and had 100 per cent UK workforce. They’re great guys and we’ve had a very low turnover of staff, we’re a good employer, we treat people properly and fairly and we’ve got good management, so I’m absolutely confident we can do that in the north east. The factory is going to be there for 100 years, it’s not just for the IEP contract, so the challenge is how we’re going to encourage youngsters to take up engineering as an occupation.’
In fact Hitachi Rail’s initial application for a University Technical College at Newton Aycliffe was turned down by the Department for Education last year, but Dormer is confident the new application, to be put through in June, will be successful. ‘It’s not unusual for a first bid to be turned down because it’s a new process. We ticked all the boxes but we had a lot of questions about the curriculum, and Sunderland University wanted to hire the headmaster first, which was a little bit chicken and egg. So we went back to the department and asked what it wants to see and hopefully we’ll be successful next time.’
Fantastically talented youngsters
Dormer believes the standard of UK apprentices is ‘Fantastic. But then again we’re literally choosing half a dozen a year from probably 150 applicants.’ Stressing that it’s his personal opinion rather than Hitachi’s, Dormer said the company will be taking many more apprentices than graduates, ‘And the really great guys of those we will sponsor to go to university because the £9,000 a year fees are quite heavy. It’s not that I’m criticising that but there will be some really talented kids who will look at a career with Hitachi at 18 rather than at 21, so we need to make sure we offer the right training and support to bring them in. We have some people at Ashford who are graduates but can’t get a job so they’ve joined our Apprentice scheme, which is slightly wrong when you think about it, but some of our best people started out as our early apprentices and they’ve grown and developed in the company and are the future leaders of the business.’
Talking about yourself
Despite previously heading up Hitachi’s European Rail Division, the new global emphasis must be a big leap for Dormer? At that point, the change of emphasis led to a switch in personal pronouns. ‘Hmmm…well, you don’t like talking about yourself do you really, but yeah ok, I’ll have to get used to it won’t I. Obviously I’m absolutely delighted to be chosen and I think it’s a major, major, thing for Hitachi to have a European lead what is one of its major businesses. Having said that you know, I’ve worked here for 11 and a half years. It’s a great company and we’ve got some great people. We are actually quite multinational so it’s not as though it’s some kind of Japanese versus non-Japanese situation, it’s not, and we’re a very integrated team. It is a big challenge for me but I see this as a great thing for the UK and Europe because clearly I can influence, from a much stronger position, where our priorities are, where we should allocate resources, where our R&D should go, very much more towards the international field, so yes, I’m going to give it my best shot.’
What’s his management style? ‘You should ask my staff really’, and we all laughed. ‘Well I don’t have my own office.’ ‘No he doesn’t’ confirmed the communications lady conspiratorially. ‘My desk is right in the middle because I like to be very accessible and I like to know what’s going on.’ Will that continue? ‘Yep’. ‘I’ve worked in different companies and I think everybody develops their own style. What drives me is the energy of the people here; I like to give people a lot of freedom, I like them to try and express themselves and not be fearful of mistakes, because we’re very much a learning organisation. I like innovation, I like ideas, I like change, and to be constantly thinking about how we can do things better and differently. So that’s probably one of the reasons why I like to be in among people.’
How does alignment with his Japanese colleagues look for Dormer? He has obviously thrived in working with two very different cultures. ‘I think we share a common sense of direction, and there are some national characteristics that work well together. A lot of our Japanese engineers have a phenomenal attention to detail, and while their planning is absolutely rigorous their outlook is very much about evolution. On the UK side we kind of prefer a few disasters along the way and a few fires to fight because that gets us excited and we can run around and go fixing problems, and actually the Japanese trait of constant progression is something that we’re not quite as good at. So we tend to have some of our European guys testing the processes to see if we can do things better, and the Japanese tweak and tweak rather than constantly shoot for the stars, so it’s quite a good blend.’
‘But’ stressed Dormer, ‘I don’t want you to have the impression that we’re mostly staffed by Japanese. One of the core planks of our strategy is to localise, so the European leadership team is based in Europe, the Indian Leadership team in India and so on, because when you’re interacting with your customers you’d better understand their culture and practices.’ Does he travel a lot to meet these people? ‘I do yes because I think it’s important to get to know them and what they’re up to. ‘No surprises’ is one of my personal mantras, and I like to be aware of the direction we’re going in and why we’re making the right decisions.’
No grubby secrets
I wondered if Dormer had a private interest in trains?‘No. I have no grubby secrets. I was in the Navy to begin with so I did the boats, then I worked in the aerospace industry for 12 years so I did the planes, now I’m on the trains. Maybe it’s cars next I’m not sure. No, what drives me is business. But you know I really get it, I understand why the rail industry attracts a lot of people who are really enthusiastic about trains. Clearly my knowledge of them is probably better than most and my wife sometimes takes the mickey if I know the particular number of a train, but there are some great people in the rail industry there really are. The enthusiasm is fantastic and it is a dynamic industry, however it can be a little bit slow for my personal taste and sometimes decisions take too long, but I’d say compared to 12 years ago it’s improving and personally wild horses couldn’t drag me away at the moment, I think it’s a great place to be.’
With two daughters aged five and seven who ‘manage me quite well’ and a son of 14, Dormer is also trying ‘badly’ to learn the piano and plays football every Wednesday night when he’s in the UK. He cycles to and from his local station and then Paddington to Holborn.
‘It was my wife’s idea after the 7/7 bombings so I went to investigate bikes and now I’m a Brompton snob. When it comes to Boris bikes I’m like, ‘Get out of the way’. They’re great bikes from a brilliant, British, innovative company.’
Future of UK rail
Does he think Network Rail is doing a good job? ‘Yes. There’s kind of a different atmosphere in there now; it’s obviously going into its devolution phase of more power to the routes rather than a central command and control. Inevitably you’ll get some bumps in the road as you make such a fundamental change but I hear good things about the new CEO. I think one of NR’s challenges at the moment is to make sure it doesn’t lose too much connection between its projects organisation and its route organisation because it has lost quite a few senior people recently to HS2. So it’s important that it gets the right people in and the right energy in.’
Unsurprisingly, Dormer believes the UK has a great future in rail. ‘But I think we can make the place a brighter one.’ Asked if there is anything he’d like to relay to Toc managers, he is quick and dry, ‘What do you mean by that? Any sales messages I want to get across! The key message is we’re open for business. Very much open for business.’