The company said in a statement that its trains division has issued invitations to tender to a number of train manufacturers 'to explore opportunities to improve its fleet', but declined to give further details.

AFX News reported yesterday that the Sunderland-based bus and rail operator, whose sole UK rail franchise is Arriva Trains Wales, is planning to order the new rolling stock.

AFX News understands that an order would be likely to involve about 50 new carriages worth about 1 million sterling each to replace unreliable Pacer trains used on Arriva Trains Wales' Valley Lines routes around Cardiff.

Manufacturers are due to submit their bids in March to build the rolling stock, which it is understood could enter service on routes in South Wales by the end of 2007.

Arriva said in its statement: 'Arriva Trains has issued invitations to tender to a number of manufacturers to explore opportunities to improve its fleet.

'It is no more than speculation at this stage to suggest that any acquisitions or leasing of new trains would take place, where any new fleet could be allocated on the company's network, or what units might be replaced in due course.

'Any decisions on purchasing or leasing new fleet would be made in partnership with the Welsh Assembly Government.

'Arriva Trains is impartial about potential suppliers and has not asked any one company in particular to explore cost options.'

Canadian rail and aerospace group Bombardier Inc, which has its main UK plant in Derby and is Britain's only remaining train manufacturer, confirmed yesterday that it is among the companies that have been invited to tender.

Bombardier's factory in the East Midlands, which employs 1,500 staff, is facing a 150 million sterling orders gap until it starts building new London Underground trains in 2008.