SWT to First MTR
Stagecoach ousted as FirstGroup and MTR consortium wins contract to operate South West Trains franchise.
A consortium of FirstGroup and MTR has won the contract to operate the South West Trains franchise for seven years, starting on August 20, with possible extension for a further 11 months.
South West Trains has been the flagship Stagecoach business since becoming the first privatised passenger train operator in 1996. It is the only franchise to have remained in the same ownership throughout.
It operates services from London Waterloo to Reading, Portsmouth, Southampton, Bournemouth, Weymouth, Salisbury, Exeter and Bristol, with an extensive suburban metro network. Its lines are the busiest in Europe, and Waterloo is by far Britain’s busiest station in terms of passenger numbers.
SWT operates 1,700 trains a day, covering 200 stations, and employs 4,500 staff. It has consistently been the most lucrative rail business, in recent years returning more than £100 million a year to the Treasury. And is the second largest passenger franchise, after Govia Thameslink Railway.
First MTR promises new, more
The new operator will make premium payments of £2.6 billion over seven years.
The franchise will receive £1.2bn of investment, of which £80 million will be directly funded by First MTR. The net contribution to the Treasury will therefore exceed £1.4bn. frequent and faster trains, with a step-change in quality of service. It will procure a new fleet of 90 trains consisting of 750 carriages, to enter service from 2019. The trains will add 22,000 extra seats into Waterloo each morning peak, and 30,000 additional seats every evening.
The company states that it is in “advanced discussions” with a number of train manufacturers, but does not identify them.
There will be earlier and later trains. Journeys from Southampton to Waterloo will be eight minutes faster, and from Salisbury 11 minutes faster.
Existing trains will be refurbished, except for those on the Isle of Wight. Eighteen five-car Class 442 Wessex Electrics will be brought out of storage and refitted for services to Portsmouth by December 2018.
New forms of flexible ticketing will be introduced, including
The extra capacity is expected to increase passenger revenue above the £991m earned in 2015-16.
Under the terms of the deal, payments will reduce should national GDP (gross domestic product) and employment in central London fall. part-time season tickets for commuters who travel three or four days a week. Tickets will be enabled on mobile phones and on smartcards shared by other transport operators in the region. A mobile phone app will be “a primary source of travel advice, pointing customers towards less busy coaches”.
There will be enhanced compensation for delays of 15 minutes or longer, and free WiFi on all trains and at all stations.
Southampton Central station will also be upgraded, with a new entrance and better facilities for passengers.
However, the deal also means that 30 brand new 12-car Siemens Class 707 trains, which are due to enter service next month, will not be retained. Recently refurbished Class 458 trains on the Reading line, which had extra carriages added last year to form ten-car trains, will also be retired. It is expected that Class 455/456 suburban vehicles that are currently undergoing a full technical overhaul will also be withdrawn.
The new company will be 70%-owned by FirstGroup, which operates Great Western, TransPennine Express and Hull Trains. MTR will hold the remaining 30%. MTR is majority-owned by the Hong Kong Government. It previously ran London Overground (with Arriva) for Transport for London, and will operate Crossrail services.
FirstGroup said the franchise would “not rely” on moving to Driver Controlled Operation, the issue which has led to more than a year of strikes on neighbouring Southern Railway. It is understood this was not a requirement of the Department for Transport’s tender process. All SWT services carry guards at present.
For the Isle of Wight services, First MTR commits only to “work with the council and other local bodies to develop a business plan and option for a more sustainable long-term future”.