Mainly focused on designing, manufacturing and servicing technologically differentiated, fast, lightweight trains, Talgo has an industrial presence in 28 countries including Spain, Germany, Kazakhstan, Uzbekistan, Russia, Saudi Arabia and the United States.

The firm provides rolling stock for the Haramain high speed railway line between La Mecca and Medina in Saudi Arabia and provider of the new AVRIL train to Spanish operator RENFE.

Talgo said it aims to enter the UK train market, through “true manufacturing”. Instead of assembling kits of parts from overseas, the company wants to source components from within the United Kingdom. This approach will grow the UK’s manufacturing capability, strengthen supply chains, create more jobs, and boost local economies.

Sites at Longannet and Hunterston have been shortlisted as potential locations for the factory alongside one in Wales and three in England.

Talgo said the shortlist represents the latest phase in a search that has lasted eighteen months, crossed much of Britain, and seen very detailed discussions with land owners, development agencies, local authorities, research establishments, schools, colleges and universities.

All locations share great connectivity, would receive a major boost from job creation, and have the potential to supply people that can be skilled-up to meet the needs of building trains that can run at up to 235mph, the firm added.

Talgo president Carlos de Palacio said: “The establishment of a manufacturing facility in the UK is a significant part of Talgo’s future strategy.

“Talgo’s aim is to establish true manufacturing – rather than assembling from parts made elsewhere. This means that we will draw from materials and expertise across the UK. This keeps more money in the UK economy, and creates more skilled long-term jobs.

“Although there can only be one factory site, we have developed excellent relationships with areas that we have visited. We anticipate continuing these relationships to ensure that Talgo provides opportunity across the UK.”

Paul Lewis, managing director of Scottish Development International, said: “We’ve been working closely with public and private sector partners across Scotland over the last year to ensure that Talgo has access to the very best business environment for its factory and the right support to make it a success.

“With potential for significant new jobs and supply chain opportunities, we are delighted that both Hunterston and Longannet have been shortlisted and will continue working with all partners to help realise the economic opportunity Talgo’s investment represents.”

Michael Matheson, cabinet secretary for transport, infrastructure and connectivity, added: “It is great news that two locations in Scotland have been selected for Talgo’s shortlist of potential factory sites. There will be significant high value jobs and supply chain opportunities if either site is selected.

“The Scottish Government and our agency partners will continue dialogue with Talgo in the coming weeks and months, whilst continuing to do everything we can to support Scotland’s manufacturing industry.”

A final decision on a factory site is anticipated in November.