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2002-06-10 VIR-001
Virgin Trains

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Virgin committed to CrossCountry franchise


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CrossCountry Trains Ltd
franchises
franchising
memoranda
Operation Princess
Virgin Rail Group Holdings Ltd
West Coast Trains Ltd



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Virgin Trains

Virgin committed to CrossCountry franchise
_______________________________________________________________


date
10 June 2002
source Virgin Trains
type Memorandum

note REN 37


Memorandum by Virgin Trains (REN 37)

A. GENERAL

Virgin Trains

1. Virgin Trains is the brand name for Virgin Rail Group Holdings Ltd (VRG). The company is jointly owned by Virgin Management (51%) and Stagecoach Holdings (49%). Virgin Trains operates two major inter-city train franchises—CrossCountry Trains Ltd and West Coast Trains Ltd.
2. The North East is served by our CrossCountry franchise and the North West by both our CrossCountry and West Coast franchises. These are managed and marketed as a single Virgin Trains brand through an executive team led by myself as Chief Executive. Both franchises were awarded for a 15-year duration in recognition of the scale of committed investment and this period ends in 2012.
3. The two franchise bids committed Virgin Trains to the total renewal of both train fleets at a cost of £2 billion and this will in turn be funded by doubling the volume of passenger travel. Railtrack is investing a further £0.2 billion in upgrading CrossCountry infrastructure and an estimated £6 billion in West Coast.
4. CrossCountry is the only national train operator in the UK. It is on the point of launching a new regional intercity network linking Scotland, the North East and the North West with the Midlands and the South without crossing London (map Appendix 2). It is managed from its hub station at Birmingham New Street and connects 115 towns and cities. It has a turnover of £300 million and carries 15 million passengers a year. CrossCountry does not manage any of the stations it serves (other than on the West Coast) and it is dependent on partnerships with fellow train companies such as GNER, Arriva, First North Western and Railtrack Major Stations.
5. The West Coast franchise operates the busiest mainline in the UK from London to the North West, Scotland, the Midlands and North Wales. Virgin Trains won a 15-year franchise in return for committing to renew the entire train fleet with tilting trains. This involved a major contract with Railtrack to upgrade the ageing infrastructure, but this contract is currently being re-negotiated following major cost escalations in conjunction with strategic review of the route's capacity, led by the SRA. The outcome of the negotiations will not be known for several months.
B. NORTH EAST SERVICES (CROSSCOUNTRY)

CrossCountry Investment

6. £1.2 billion is currently being invested in a major upgrade of the CrossCountry network which will renew the entire train fleet and upgrade 150 track miles (in addition to the West Coast). The 34 Voyager (non-tilt) trains are now fully operational and over half of the 44 Super Voyagers are also in traffic, with completion due this autumn. Bombardier Transportation built the trains and have also won a £0.6 billion contract for their maintenance until 2012.
Service Frequency

7. The entire CrossCountry timetables is to be re-written on 30 September to create the new regional network in which train service frequencies will almost double overnight and many journeys accelerated. The new CrossCountry timetable is code-named Operation Princess and represents one of the biggest national timetable changes in the last 30 years. The North East will be one of the main beneficiaries of the upgrading with a doubling of train frequencies throughout the region as follows:
CrossCountry trains: daily to/from
Now 30 September 2002
Berwick 6 32
Newcastle/Durham/Darlington 27 64
York 28 64
Leeds 21 33
Doncaster 11 30
Sheffield 32 65

8. The new service will give the North East two core CrossCountry links across the UK: (a) an hourly Edinburgh-York-Leeds-Birmingham-South West service; and (b) an hourly Newcastle-York-Doncaster-Birmingham-South Coast service. Trains will be routed alternately via Leeds and Doncaster to provide each with an hourly CrossCountry service and more connections into local train service networks (40% of CrossCountry passengers use another train company). The new services also create a new two-hourly direct service link between the North East and South Wales.
Influence on North East economy

9. We recognise the contribution which good rail services make to the economic prosperity of the regions by improving accessibility and reducing road congestion. We are working closely with local authorities, regional development agencies, businesses and chambers of commerce to promote the benefits of the new train services and maximise their usage. We shall be running a major public campaign to launch the new Cross Country operation in September 2002 and to keep the public well informed about the new travel opportunities through both television and the regional media.
10. From June 2002, the North East will benefit from a far wider range of destinations for Virgin Value fares. Newcastle, for example, will now have Virgin Value fares to destinations as far afield as Aberdeen, Swansea and Penzance with costs as low as £20 in return for booking in advance.
Quality travel

11. The new Voyager trains cost £4 million each and are being delivered by Bombardier Transportation from their Wakefield factory. The Voyager is a diesel train with a sports car performance which can cruise at 125 mph. They offer a vastly improved travel experience with an on-board shop, a Club Class area with at-seat service, electronic information systems and audio-entertainment at every seat. The Voyager/Super Voyager fleets are amongst the first in the UK to fully comply with the European legislation for disabled access.
12. The SRA National Passenger Study was published on 6 June and demonstrated that customers' overall opinion of CrossCountry journeys improved from 65% satisfaction in January 2001 to 78% in January 2002. The plan is to drive this satisfaction to 90% through the new trains, the doubling of frequencies, additional staff and customer service training. All our ageing loco-hauled trains will be withdrawn by 19 August and all but eight of the High Speed Trains will be withdrawn by 30 September.
13. We shall be using Operation Princess to raise our customer service standards across the CrossCountry network. An additional 303 staff have been recruited across the network (78 in the North East and 69 in North West) to provide at-seat service and to strengthen customer service staffing at interchange stations such as Birmingham New Street. We have recently trialled provision of a Virgin Trains customer service team member at York and plan to expand our presence at other North East stations. We are also introducing a new Customer Service desk within our operational Control Room to provide back up for train managers and station managers when things go wrong.
Safety and Performance

14. A Director of Safety reports directly to the Chief Executive and the Board, and our safety performance is reviewed annually by independent external Safety Auditors (ROARS). All our new trains are being delivered with the new TPWS system operational and are also designed to be compatible with the new ERTMS automatic train protection system when this is installed. The new train fleet will eliminate slam doors on both franchises with the exception of eight High Speed Trains which will be retained with central locking.
15. CrossCountry will always be the most difficult inter-city route to operate, because it operates long routes with journeys up to 10 hours which pick up the delays of all six Railtrack Zones. It suffered especially badly from the post-Hatfield speed restrictions and flooding. The Graph in Appendix 1 shows that Train performance is now on a rising trend and we expect the new trains and the regular interval timetable to continue this trend. We have just strengthened our operational Control Room to recognise the doubling of train services and we are starting to see the benefit of a £40 million investment in CrossCountry's first ever dedicated maintenance depots.
Network Capacity

16. We signed a contract with Railtrack in 2001 for a £200 million investment in track upgrading which includes some capacity improvements at south of Birmingham. The Railtrack work is on schedule and the North East area has already benefited from capacity improvements at Doncaster and Leeds in addition to other work at Reading and Bristol. A big improvement will come in 2003 when the route from Birmingham to York is upgraded from 90 mph to 125 mph to give an acceleration of almost 10 minutes. Further investment is however needed if rail traffic is to expand and priorities would include:
— additional tracks Darlington to Newcastle (eg re-opening Leamside route); and
— Sheffield station area and the Chesterfield-Rotherham corridor.
C. NORTH WEST (WEST COAST AND CROSS COUNTRY)

Virgin role in North West

17. Virgin Trains provides an even more extensive service in the North West, with roughly equal numbers of trains from its West Coast and CrossCountry franchises. CrossCountry will also be using its Super Voyager trains (five cars) in the North West which are equipped to tilt round the many curves on the West Coast mainline.
West Coast investment

18. In addition to CrossCountry, the North West will benefit from the West Coast upgrade which includes over £7 billion investment for the region. This includes £0.6 billion for 53 Pendolino trains (nine cars) and a further £0.6 billion for their maintenance until 2012 by Alstorn. Railtrack is currently reviewing its ability to deliver the infrastructure upgrade and the outcome of the re-negotiations is likely to be a 125 mph railway with new trains running in 2003 (non-tilt) with a full timetable in 2004.
Service frequency

19. A rather ragged CrossCountry service pattern will be replaced with a new hourly service to Carlisle/Scotland and Birmingham/Reading. There will also be new two-hourly service from Manchester to Scotland, from Blackpool to Birmingham and from Liverpool to Birmingham. Operation princess will renew the entire CrossCountry train fleet with Voyagers/Super Voyagers from 30 September 2002 in the North West, and will bring major timetable benefits in both service frequency and journey times:
CrossCountry trains: daily to/from
Now
30 September 2002
Manchester-Birmingham
38
50
Warrington-Birmingham-South
15
32
Liverpool-Birmingham-South
10
18
Blackpool-Birmingham-South
3
14
Preston-Birmingham-South West
22
48
Birmingham-Scotland
29
55

Influence on North West economy

20. The North West is at the centre of a massive rail investment which will bring brand new trains on both franchises, together with a near doubling in train service frequencies and journey time accelerations of up to 25%. The major CrossCountry benefits will be completed by September 2002 and the West Coast by May 2004, The North West has been at a disadvantage for some time now from an ageing rail network and congested motorways. This will change as journey times from London are shrunk to a little over two hours to the main North West cities with modern tilting trains. We are working closely with Regional Development Agencies, tourist authorities and the media to ensure the public are aware of the future travel opportunities.
Quality travel

21. In addition to the new Voyager Trains (paragraph 11 above), the North West will also benefit from the imminent delivery of the new fleet of 53 Pendolino tilting trains for the West Coast. The first Pendolinos should replace the older trains from this autumn (non-tilt) and the London-Manchester service frequency will be increased to half-hourly all day in May 2003 together with a new two-hourly London-Holyhead service. The big timetable upgrade should be completed by May 2004 when a totally new timetable will be introduced based on 125 mph running and full tilt operation.
22. The SRA National Passenger Study was published on 6 June and demonstrated that customers' overall opinion of West Coast journeys improved from 65% satisfaction in January 2001 to 75% in January 2002. The plan is to drive this satisfaction to 90% through the new trains, the doubling of frequencies, additional staff and customer service training.
23. We have invested over £6 million in North West stations so far, with the priority on reducing ticket queues (FastTrack machines, Telesales, Internet) and improving customer security at car parks and stations. Station developments range from the flagship redevelopment of Manchester Piccadilly (Railtrack), to significant refurbishments at Liverpool, Stoke-on-Trent, Preston, Carlisle and Stockport (starts August). A further £90 million of private funding is now being sought for the comprehensive upgrading of all our stations to include major car park extensions, new ticket shops, upgraded toilets, modern information systems and lift access to all platforms.
Performance

24. We recognise that West Coast train performance deteriorated badly in 2001 and we have been working hard to keep the trains and infrastructure operational for the last 18 months of their lives. The graph in Appendix 1 shows that continuous upward improvement is now being achieved following the Hatfield situation. The new train fleet will bring high levels of train reliability and the opportunity to recover from failures.
25. Railtrack is now investing £3 million a day in the West Coast upgrade and work is well advanced, with major signalling completed at Birmingham, Euston, Willesden and North Staffordshire. The quality of the newly completed infrastructure is very high and is contributing to improvements in both punctuality and ride quality. A downside of the high infrastructure investment has been Railtrack's decision to close the four-track section of the West Coast south of Rugby for 18 consecutive weekends this autumn to facilitate the engineering work.
Network Capacity

26. Further investment is needed if rail traffic is to expand and priorities would be:
— develop case for up to nine extra Pendolino trains;
— develop case for electrification of Blackpool-Preston-Manchester;
— develop case for electrification of Crewe-Kidsgrove and Crewe-Chester; and
— develop case for increased line capacity (four-tracking and grade-separation).
Chris Green

Chief Executive
10 June 2002


Railhub Archive ::: 2002-06-10 VIR-001





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