In a statement released on Canada News Wire, Progress Rail said it regretted the move, but “[t]he cost structure of the operation was not sustainable and efforts to negotiate a new, competitive collective agreement were not successful." 

"Progress Rail's global manufacturing network assures its customers that delivery schedules will not be impacted by this decision," the company added.

Progress Rail said early Friday it was in the process of notifying the workers of their decision. In a letter to employees issued later in the day from Progress Rail’s parent company, Peoria, Ill.-based Caterpillar, Inc., President and CEO Billy Ainsworth said, “As you know, we compete in a global marketplace where orders for locomotives are won or lost based on extremely competitive pricing and the ability to meet short turnaround times. All facilities within EMC [Electro-Motive Canada], Electro-Motive Diesel, and Progress Rail Services must cahieve and maintain competitive costs, quality, and operating flexibility in the global marketplace.

“The London plant, primarily because of an antiquated labor contract, faced serious competitive disadvantages,” Ainsworth noted. “We will now start the process of conducting an orderly closure of the London production operations, including the transfer of locomotive assembly operations to our competitive facilities in North and South America.”