Alexander Dennis which cuts a quarter of workforce got £8.3m in 'job securing' Scots public funds

And the union has raised fears there will be deeper cuts as ADL documents reveal a UK plan to "reduce manufacturing facilities".

ADL said the decision followed a "significant fall" in demand for new vehicles in the UK and the fact there was "no immediate visibility of the stimulus funding urgently required to support operators to place orders".

Unite believes the final job losses proposed is likely to exceed 200 at its Falkirk and Larbert bases after the company fully reveals its restructuring plans.

And it has called for any further government support for ADL to be conditional on keeping jobs in Scotland and the UK.

ADL plans to cut 650 jobs across the UK - including 200 in Surrey, 90 in Scarborough and 200 other roles across its bases.

The announcement affecting Falkirk and Larbert comes in the aftermath of Unite revealing that ADL's Canadian parent company, New Flyer Industries (NFI), plans to outsource a large bus building contract for Berlin to a company in Turkey, "despite using the decline in orders to try and justify planned cuts".

The Herald can reveal that the bus company has received nearly £8.5m in grants to support jobs in Scotland over 11 years.

Some £7.5m of public money was given by Scottish Enterprise to accelerate its expansion low-carbon vehicle programme in September, 2016. It was the largest research and development grant in the quango's history and came despite the manufacturer recording an £18.5m profit the previous year.

One of the company's chief shareholders at the time was Stagecoach tycoon Sir Brian Souter - a major financial supporter of the Scottish National Party.

That was before NFI took over the Scottish firm for £320m in May last year and announced it wanted to hit a sales trajectory of £1 billion for the coach and bus maker, including expansion in Scotland.

Both ADL chief executive Colin Robertson and Michael Stewart, chief financial officer, stayed on to continue the work done in Falkirk and Larbert.

Scottish Enterprise said the £7.5m taxpayer boost would "help increase their innovation, research and development and global reach".

It helped Alexander Dennis set up a £30 million development and product market programme to allow the launch of the eco-friendly Enviro400XLB, its highest capacity bus for the UK market, in conjunction with Lothian Buses.

First Minister Nicola Sturgeon during a visit to Alexander Dennis in 2016

Scottish Enterprise lauded the launch of the green bus manufactured in Falkirk saying it was "securing jobs and adding value to the Scottish economy directly and via the extensive local supply chain".

"This accelerated our growth much faster," said Mr Robertson at the time.

First Minister Nicola Sturgeon described Alexander Dennis as a "true Scottish success story".

She added: "ADL's continued commitment to invest in Scotland is testament to the skilled workforce here in Falkirk

Mr Robertson handed over the first bus to Lothian managing director Richard Hall on November 8, 2018 in a ceremony at the manufacturer’s Falkirk plant that was attended by transport secretary Michael Matheson, and representatives of Scottish Enterprise and Transport Scotland.

Scottish Enterprise did not have a stake in the company and therefore would not see any return from the takeover.

It is not the first grant provided.

The bus firm which was rescued from the brink of collapse in 2004, by Scottish investors, was the following year awarded an £800,000 government research and development grant.

The Falkirk-based company said at the time that the R&D Plus award was to be used to develop a new generation of buses and was to help secure nearly 800 jobs.

ADL was established in 2004 when a consortium of Scottish entrepreneurs led by Mr Souter and including Dame Ann Gloag (Souter's sister), Sir Angus Grossart and Sir David Murray acquired the business from TransBus International's administrators.

Unite says the "devastating news" of the planned cuts highlighted "the precarious state of Scotland's green manufacturing capacity" and that the need for a "green mass transport revolution" is clear".

But it says it will only be delivered "if we have the capacity to manufacture the buses and other modes of transportation to facilitate this".

The union’s Scottish Secretary, Pat Rafferty, said: "The severity of these cuts at Alexander Dennis at Falkirk are premature and risk being detrimental to their long term success.

"We understand that the company is not facing cash flow problems but currently they have a lack immediate orders and work. We call on ADL to come clean with full disclosure in relation to their orders and work with Unite to save these jobs. We believe this situation could be temporary and there are a number of interventions which could be made by the UK and Scottish Governments to alleviate this situation.

"More generally, the devastating news from Alexander Dennis highlights the precarious state of Scotland's green manufacturing capacity.

"If the Scottish Government seriously wish to deliver the nation’s climate change target of a net zero economy by 2045 then strategic support must be given to businesses based in Scotland in the interests of protecting jobs and the environment. If this support is not forthcoming then meeting this target will be achieved by the extensive importation of wind towers, wind turbines and buses at the expense of creating thousands of highly-skilled jobs across our nation."

Unite discovered that the job cuts were planned before the Covid-19 pandemic.

The implementation of the strategy, NFI Forward, was announced to investors in North America on August which included "reduced UK manufacturing facilities" with the union saying that meant potentially closing a UK manufacturing site.

The union said an acceleration of orders to bus manufacturers and the supply chain through the new Scottish Ultra-Low Emission Bus Scheme was needed to provide £9 million this year to help operators invest in green vehicles.

It says the Scottish Government should enact the Just Transition Committee’s recommendation to rapidly roll-out spending of the £500 million committed to prioritise buses.

And it wants the establishment of a Scottish-wide bus scrappage scheme to replace older diesel buses with low emission and zero-emission buses.

It also called for the immediate procuring of a fleet of green buses for use at COP26 in Glasgow next November.

Mr Rafferty added: "Unite has a number of pressing questions for the Scottish Government, principally, how quickly can the new Ultra-Low Emission Bus Scheme work in practice and will bus operators such as Lothian Buses be able to access this scheme immediately.

"Also, we need clarity on who will commission and procure a new green fleet of buses for the COP26 next year as recommended by the Just Transition Commission and how quickly can a bus scrappage scheme be brought forward? These are vital questions which remain unanswered by the Scottish Government but would instantly provide orders which Alexander Dennis is primed to deliver."

Alexander Dennis built two Enviro500 test vehicles in 2015 for Berliner Verkehrsbetriebe (BVG) which in 2018 said it wanted 200 to operate around the German capital. BVG was ultimately seeking 430 worth a total contract value of €220m.

However, Alexander Dennis’s failure to confirm where the work would be done fuelled uncertainty over it coming to Falkirk and the issue has dragged on for almost two years.

Alexander Dennis said: "In response to claims made elsewhere about the arrangements for the manufacture of our European landmark contract [Berlin], these are entirely disconnected from the actions we are being forced to take in the UK as a result of the coronavirus pandemic.

Colin Robertson

"The ongoing lack of clarity over the future trade relationship between the UK and the European Union threatens import tariffs and other costs which would make this and potential other European contracts commercially unviable if manufactured in the UK. As in other parts of the world where UK manufacture is not feasible, we have had to make contingency plans to ensure the contract remains viable."

ADL president and managing director Paul Davies called on the UK and Scottish Governments to "urgently introduce meaningful support to facilitate demand for new buses and coaches, not only to prevent further damage to UK bus and coach manufacturing that could threaten additional production sites, but to help build back better with a green recovery that delivers cleaner air for our towns and cities".

According to Transport Scotland, there were an estimated 388 million bus journeys made in Scotland in 2017/18 compared with 487 million in 2007/08. A drop of nearly 100 million over the past decade.

In Scotland, transport has regularly accounted for a large part of emissions.

According to Unite, the sector accounts for around 37 percent of all carbon emissions. Forty per cent of this total is generated by cars whereas bus and coach total only 3.2 per cent of all transport emissions.

Alexander Dennis, the world's largest producer of double-decker buses, was acquired by a group of Scottish investors in 2004. It employs 2,500 workers, most of them in Falkirk but also in Guildford and Scarborough.

Stagecoach founders Sir Brian Souter and Dame Ann Gloag owned more than half the Falkirk-based company when the takeover happened.

A Scottish Enterprise spokesman said: “Alexander Dennis Ltd (ADL) is a major employer and an iconic brand in manufacturing in Scotland. Scottish Enterprise has worked with the company over a number of years to support innovation and jobs, to the benefit of the Scottish economy.

“We recognise that this is a worrying time for workers at ADL and we are working closely with the business to explore all possible solutions.

"Grants provided by Scottish Enterprise to any company are not for the purchase of shares or equity, and would never result in profit resulting from a takeover.

"Grant payments are made with the standard condition that the project will complete in full, and we retain the right to recover grant payments where a project does not complete to our satisfaction."

Jamie Hepburn, minister for business, fair work and skills, said: “I am very saddened to hear of the redundancies planned at ADL. The Scottish Government’s stands ready to support any staff affected through Partnership Action for Continuing Employment (PACE), our initiative for supporting people affected by redundancy.

“[On Thursday] we launched a £9 million Scottish Ultra Low Emission Bus Scheme to help bus operators invest in ultra-low emission vehicles and to support the supply-chain. We continue to work with ADL to explore all possibilities for keeping jobs in Scotland.”