InterCity Railways, a Virgin/Stagecoach consortium, has been awarded the East Coast rail franchise.
The joint venture, which has operated trains on the West Coast main line since 1997, had been awarded the contract despite speculation that a French consortium comprising Keolis and Eurostar was leading the process.
The new franchise will run from March 2015 for eight years, with an option for another year.
East Coast services have been operated by the government’s Directly Operated Railways since 2009, following the withdrawal of National Express.
Since 2009, Directly Operated Railways has paid back around £1 billion to the government and last year recorded a £225.3 million profit. Over the course of the eight-year franchise, InterCity East Coast has said it will deliver £2.3 billion in premium payments.
Peter Wilkinson, managing director of passenger services at the Department for Transport (DfT) said that the content of the Stagecoach/Virgin Trains bid would transform services on the East Coast main line beyond recognition.
Responding to the “uncomfortable noise” about the rumours surrounding the Keolis/Eurostar bid, Wilkinson stressed that Britain runs an “open and liberalised market for railways” where anyone “willing and wishing” to operate the country’s trains are able to bid.
![New IEP trains for InterCity East Coast franchise operated by Stagecoach and Virgin [online]](http://g-r-news.com/wp-content/uploads/2014/11/New-IEP-trains-for-InterCity-East-Coast-franchise-operated-by-Stagecoach-and-Virgin-online.jpg)
The consortium will also introduce 23 new services out of King’s Cross station, including direct services to Sunderland and Stirling within the first year of the franchise. The additional offering will increase the number services operated under the franchise from 77 to 100.
Martin Griffiths, chief executive of Stagecoach Group, said: “Passengers using the East Coast main line will benefit from hundreds of millions of pounds of infrastructure investment and service improvements over the next decade.
“Together with Virgin, our innovative plans will give customers new services, faster and more frequent trains, and easier, more personalised journeys.”
Speaking at a DfT briefing, Griffiths added: “The great news is that this is a railway going for growth. This is a railway that will be employing people not reducing the workforce.”
Transport Secretary Patrick McLoughlin said: “This is a fantastic deal for passengers and for staff on this vital route. It gives passengers more seats, more services and new trains.
“We are putting passengers at the heart of the service. I believe Stagecoach and Virgin will not only deliver for customers but also for the British taxpayer.”
Now that a decision has been taken to award the East Coast franchise to “Virgin East Coast”, then the West Coast franchise should be transfered to the displaced Directly Operating Railways. It has provided a benchmark on one line so let it do the same on the other. That way we can see how well, or not, Virgin (West Coast) have actually been doing. It also provides the necessary commpetition between the two lines.
That is never ever gonna happen
The franchise is only for 8 years, which gives no real incentive for investment by Virgin/Stagecoach. Surely the time is going to come when a complete overhaul of the franchise system will be needed – or scrapped completely and a new method of awarding long-term contracts to all TOCs formulated.
They’ll have to use the new trains, so that’s covered. Not sure how many stations they’ll run but I think a deal could be done to recoup investment if they lose the franchise. Otherwise, and excluding staff uniforms, marketing and napkins, what else can they invest in?