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Train maker Bombardier, which recently missed out on the £1.4bn Thameslink contract, has said it plans to cut more than 1,400 jobs at its Derby plant.
Last month, the company lost out to German group Siemens as the preferred bidder to build 1,200 carriages for the route between Bedford and Brighton.
Unions and opposition politicians have called for the government to review its decision to choose Siemens.
But Transport Secretary Philip Hammond said that this was not possible.
The UK subsidiary of Canada's Bombardier said that there was not enough future work to keep its Derby facility, which employs 3,000 people, operating at current levels.
It plans to cut 446 permanent jobs and 983 temporary contract staff, and has launched a 90-day consultation process.
The company said that by the end of September, it would have completed work on two major contracts and would only have work remaining on one more.
"The culmination and successful delivery of these projects and the loss of the Thameslink contract, which would have secured workload at this site, means that it is inevitable that we must adjust capacity in line with economic reality," said Francis Paonessa, president of the passengers division for Bombardier in the UK.
"We regret this outcome but without new orders we cannot maintain the current level of employment and activity at Derby."
While Bombardier is laying off staff, Siemens has said that it will create 2,000 jobs across the UK as a result of winning the Thameslink contract.
However, Siemens will build the trains in Germany and only 300 of the UK jobs it creates will be directly employed manufacturing posts, at a factory in Hebburn, South Tyneside.
Siemens already employs about 16,000 people in the UK.
'Short-sightedness'Nightshift workers leaving Derby's Litchurch Lane plant on Tuesday morning were clearly distraught and left wondering about the future of the company, said Anthony Bartram, the BBC's correspondent in Derby.
Securing the Thameslink contract was regarded as crucial for the plant, the UK's last rolling stock manufacturer.
However, in a letter written to the government before it chose its preferred bidder, Bombardier had said that even if it had won the Thameslink work, it would still have had to lay off 1,200 workers in Derby as it adjusted to finishing other major contracts.
The government has said that the Siemens bid represents the best value for money, and that it was following EU procurement rules, which do not allow where companies are based to be taken into account.Contined
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