In 1962, the English Electric Company Ltd amalgamated the locomotive-building activities of their already-owned Vulcan Foundry (Newton-le-Willows Works) and its subsidiary Robert Stephenson & Hawthorns (Darlington Works), and W. G. Bagnall Ltd (Castle Engine Works, Stafford) under one management and a new wholly-owned subsidiary was formed named English Electric Traction. W. G. Bagnall Ltd was bought from W H Dorman in 1962 and effectively closed. The RSH works at Darlington ceased vehicle building in 1964. Vulcan Foundry was left as the only site for in-house locomotive building at the end of this period of contraction and rationalisation. It also took over manufacture (from Preston) of the range of EE diesel engines for railway locomotive use under the EE Diesels name. English Electric Traction initially operated from two Works to produce electrical equipment for locomotives and multiple-unit trains. These were in Preston (Strand Road, formerly Dick Kerr Works), and Bradford (Phoenix Dynamo Works). The Bradford works had done design work and manufacture of control gear as part of EE since 1930, but this activity was rationalised after 1962 and incorporated into the Preston operation by 1967, when the transfer of design engineering and commercial activities and staff was completed. The Preston works became the HQ centre for traction equipment (both control gear and motors), scheme design, building and testing. This equipment was sent to independent vehicle builders, to vehicle-builders in-house (i.e. at Vulcan Foundry or RSH), to overseas constructors, or to the British Rail workshops. The EE Stafford works was only engaged in traction activity is a minor way, principally as in-house supplier of main transformers and tap-changers, e.g. for 25kV locomotives, and some research and development activities on HV equipment. It was never part of EE Traction itself. The EE-AEI agreement, in the early sixties, resulted in joint electric loco production, for British Rail (Class 86), Poland, Pakistan and South Africa - 5E's were EE, 5E1's MV and after that joint production of electrical equipment with build of the mechanical parts in South Africa. English Electric Traction merged with AEI Traction Division in 1969 to form English Electric - AEI Traction, which subsequently became GEC Traction in 1972.

The British Thomson-Houston Co. Ltd., (BTH) was created as a subsidiary of the General Electric Company, USA in 1896 to exploit the sale of products in the United Kingdom. BTH was a reconstruction of an existing firm, Laing, Wharton and Down (1886). The BTH manufacturing works were based at Rugby, Warwickshire and the company’s products included induction motors, alternators, switchgear, turbo-generators and turbines, as well as a large number of rotary converters and motor converters, primarily for chemical plants. During the First World War, BTH’s most significant contribution was the development of marine apparatus for the naval service. The 1920s saw a period of vast expansion for the company with new extensions built at many of its factories such as Willesden, Birmingham, Chesterfield and Lutterworth. BTH amalgamated with Metropolitan-Vickers Electrical Company Ltd to form Associated Electrical Industries (AEI) in 1928 although both companies retained their separate identities and continued to compete for the same contracts. BTH developed manufactured electric torpedoes and electrical components for aircraft engines, munitions, etc., during the Second World War and in 1935 independently of each other, BTH and Metropolitan-Vickers were the first two companies in the world to construct jet engines.

The Vulcan Foundry was originally opened in 1830 at Newton-le-Willows, as Charles Tayleur and Company. It initially produced girders for bridges, switches and crossings, and other ironwork following the opening of the Liverpool and Manchester Railway. Robert Stephenson became a partner in 1832, and in the same year, the first locomotives ‘Tayleur’ and ‘Stephenson’ were delivered to the North Union Railway. By 1840 locomotives had been delivered to five European countries and to North America. The company became The Vulcan Foundry Company in 1847 and acquired limited liability in 1864. From the beginning of 1898, the name changed again to The Vulcan Foundry Limited, dropping the word 'company.' Vulcan locomotives were exported all over the world, with the first locomotives for Russia and Japan supplied in 1837 and 1871 respectively and a long association with India began in 1852. First World War production included shells, gun mountings and mine sweeping equipment. The first non-steam locomotive, an electric, was produced for India in 1929. The first diesel locomotive design commenced in 1932/33 and an agreement was reached with A/S Frichs in Denmark. The English Electric 6K engine was used from this time. The “Waltzing Matilda” tank was developed in 1938 and produced in large numbers and over five hundred ‘Austerity’ steam locomotives were produced for the War Department. Other wartime production included gun mountings and torpedo parts. In 1944 Vulcan acquired the locomotive business, Robert Stephenson & Hawthorns Ltd, based in Newcastle-upon-Tyne. In 1946 the company began working with the English Electric Company producing diesel and electric locomotives and became part of the English Electric Group in 1955. All locomotive building from Preston was transferred to Vulcan Foundry and Robert Stephenson’s in Darlington. Under the new ownership, the works produced many locomotives for both domestic and foreign railways, notably the Deltic. The mid-sixties saw the ‘RK’/’V’ engine production at Preston moved to Vulcan and Ruston & Hornsby Ltd merged with English Electric Diesels in 1966. After the General Electric Company plc (GEC) takeover in 1968 the Ruston name was used for some time inside what became GEC Diesels Ltd in 1975. Engine production and development continued for locomotive, industrial and marine applications until after the GEC-Alsthom merger in 1989. The company took over Mirlees Engines, Stockport in 1997 and was renamed Alstom Engines Ltd.

The General Electric Company (GEC) merged AEI Traction Division and English Electric Traction in 1969 after acquiring both companies to create English Electric – AEI Traction Limited. The headquarters were located at Trafford Park in Manchester. This subsidiary company was renamed GEC Traction Limited in 1972.

Associated Electrical Industries (AEI) was formed in 1928 as a financial holding company for a number of leading electrical manufacturing and trading companies in the United Kingdom. The two major constituent companies were British Thomson-Houston (BTH) based at Rugby, (Mill Road Works) and Metropolitan-Vickers Electrical Company Ltd (Metrovicks) situated at Trafford Park, Manchester. However, fierce rivalry existed between the Metrovick and BTH brands resulting in internal competition and duplicated management. This was highlighted during the Second World War in 1939, when Metrovicks and BTH became the first two firms in the world to construct jet engines (independently from each other). Following the Second World War, in 1954, AEI expanded to consist of BTH, Metrovicks, Edison Swan Electric Co, Ferguson Pailin, Hotpoint Electric Appliance Co, International Refrigerator Co, Newton Victor, Sunvic Controls, Premier Electric Heaters, Siemens Bros (1955) and Birlec (1954). In 1959 AEI decided to remove the familiar brands of BTH and Metrovicks and consolidate both as AEI resulting in internal problems and a fall in sales and market value. However, AEI acquired a variety of companies from 1959 to 1967, these included Associated Insulation Products, W. T. Henley’s Telegraph Works Co (1958), and London Electric Wire Co and Smiths (1958), Submarine Cables, Hackbridge Holdings Ltd., The Lancashire Dynamo and Crypto Ltd., W.T. Avery Ltd., Henley and Schreiber. The General Electric Company bought AEI in 1967.

In 1959 Associated Electrical Industries (AEI) created a self-contained company named AEI Traction Division to control the railway activities of both Metropolitan Vickers Electrical Company Ltd and British Thomson-Houston (BTH). Included in this company were the interests of the Metropolitan-Vickers General Railway Signal Co., (later to become GEC General Railway Signal). The newly formed company established its headquarters, at Trafford Park, Manchester, and operated from three other sites, Attercliffe Common in Sheffield, Rugby Works, and Stockton Works supplying traction motors, machines, control gear and mechanical parts of locomotives. AEI Traction Limited’s product range encompassed electric and diesel-electric locomotives; electrical equipment for tramcars, trolley buses, trolley mining locomotives, traction motors and gears. In 1969 AEI Traction Division merged with English Electric Traction to form English Electric-AEI Traction Division.