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2012-09-03 VIR-001
Virgin Rail Group

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Virgin Trains responds to FirstGroup’s proposals for West Coast


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Virgin Rail Group

Virgin Trains responds to FirstGroup’s proposals for West Coast
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related documents


2012-08-15 New operator for West Coast rail passengers (DfT Department for Transport)

2012-08-15 Press Statement: from Sir Richard Branson, Founder Virgin Group (Virgin Rail Group)

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date
3 September 2012
source Virgin Rail Group
type Press release



Virgin Trains has responded to FirstGroup’s proposals for improvements on the West Coast Main Line which were outlined to Parliament today, 3 September 2012.

Tony Collins, Virgin Trains CEO said: "We welcome the Transport Department's decision to delay the process. We hope that Ministers will also agree to our proposal that there should be an independent review of the decision to award the contract to FirstGroup.

"We note the Minister's assessment of the FirstGroup bid and take strong exception to the view it provides better value than Virgin Trains. We have submitted a strong and deliverable bid with more commitments on new trains, new routes and new onboard services. In total we have outlined £800 million of new investment compared to £350 million announced by First Group.

Normally, under franchise process, the successful bidder sets out a range of ‘franchise obligations’ – legally binding commitments – but none has been published by FirstGroup or the Department for Transport.

The proposals that have been revealed are less beneficial to customers than Virgin’s. A comparison of the two sets of proposals is shown below.

Trains / capacity

First Group: More trains on the route, with 12,000 extra seats per day provided by 11 new 6 carriage electric trains from December 2016 (in addition to the 106 extra Pendolino carriages currently being introduced) and refurbishment of the existing Pendolino and Voyager train fleets.

Virgin: We would replace all of the Voyager trains with 21 6-car ‘Baby Pendolinos’ which would mean no diesel operation over electrified lines, delivering the best environmental solution and an all-Pendolino fleet providing the best passenger environment. All the exiting Pendolinos would undergo a major refurbishment.

FirstGroup appears to be retaining all of the Voyager fleet but it is not clear whether this is a firm commitment or whether they have the option to redeploy them to other routes. Assuming they do retain all of the Voyagers, FirstGroup would be providing 4% more seats than Virgin would on a daily basis.

Virgin would investment £385m in the fleet. We understand there are no contracts in place for the FirstGroup proposals.

Capacity between Birmingham and Scotland

FirstGroup: More capacity on services between Birmingham and Scotland.

Virgin: We would also provide more capacity on this route, but in addition we would offer direct services from the south Midlands via Birmingham. All services between Birmingham and Scotland would be operated by either six, nine, 11, or 12-car trains.

Journey times

FirstGroup: Faster journey times between London Euston and Glasgow.

Virgin: FirstGroup’s proposals would involve removing some stops en route, to speed up the service. Virgin’s proposals are based on track improvements to deliver the improved journey times. Working with Network Rail we would undertake a number of infrastructure upgrades including enhancement to allow the Pendolino to reach a top speed of 135mph in order to improve a number of journey times. This Virgin investment would be £125m, but there is no firm commitment in FirstGroup statements.

New destinations

First Group: New services to Blackpool, Bolton and Shrewsbury, subject to approval of the Office of Rail Regulation.

Virgin: Our Bid also proposes new direct services to Telford, Shrewsbury, Blackpool and Bolton, but they would start a year earlier than in FirstGroup’s proposals. We would also double the frequency to Preston and increase calls on the North Wales route, and at Nuneaton and Milton Keynes. In addition we would create new services to Stirling, Motherwell, Hartford and Liverpool South Parkway; further enhance services for Gobowen, Chirk, Ruabon and Wrexham; increase journey opportunities between Milton Keynes/Rugby/Stafford and the North West; and increase calls at Tamworth and Lichfield.

Fares

First Group: Lower Standard Anytime fares over the first two years.

Virgin comment: The lowering of the standard fare which makes up around 20% of annual revenue still results in FirstGroup increasing fares in real terms by 22% and at the same time they plan a massive growth in passengers to around 66m per annum by 2026, creating a major overcrowding problem.

Station improvements

FirstGroup: £22m in station improvements.

Virgin: Our investment for stations totals £99m. Like FirstGroup we would install ticket gates and undertake a number of station improvement projects. We would also create more car parking, install more ticket machines and introduce smart cards. CCTV and information points would also be installed.

Ticketing / passenger services

FirstGroup: Oyster-style smart ticketing.

Virgin: We would design and develop a revolutionary new Centralised Booking Engine (CBE) which is unique to the industry. It would pull together all of the many industry systems and provide the passenger with a one stop shop experience. As part of this we would introduce a new customer experience system which includes a loyalty scheme in partnership with a major scheme provider. The investment in this area is £39m; there is no detail in this area from FirstGroup.

Customer satisfaction

FirstGroup: For the first time in an intercity franchise, better customer satisfaction as measured by the National Passenger Survey.

Virgin: We currently score the highest rating for all long-distance franchise operators (91%). Our plans would seek to increase this rating by building on the fantastic service our people provide backed by an investment programme which is more than twice that promised by FirstGroup.

Onboard service

Virgin: Virgin would replace the current Wi-Fi system with a completely new state-of-the-art system capable of growing with passenger needs, as enhancing the current system is not feasible.

There would be a complete refresh of the onboard offer. This would support the enhanced at-seat complimentary service in First Class and a new at-seat service for Standard. The Virgin investment in the onboard service is £109m, but there are no details as yet from FirstGroup.

Investment

FirstGroup: FirstGroup has said its investment package is worth £350m but there is little detail of how this is to be spent. To help customers and politicians understand the FirstGroup proposals, Virgin Rail Group has put 10 questions to Mr O’Toole, based on his recent comments to analysts and MPs.

Virgin: We are planning to invest nearly £800m in the franchise, including a number of other projects not listed above.


Railhub Archive ::: 2012-09-03 VIR-001





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