The government has announced that Stagecoach and Virgin Rail have lost their contract to manage the East Coast rail line between London and Edinburgh. The line will now be managed by a government organisation. No doubt they intend to find another company to take it on, eventually.
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East Coast trains dePrivatised
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Third time! Twice before since privatisation private companies have failed running this line. In both cases they were taken over by publicly-owned entities which poceeeded to make a profit. Now a third private company has failed, and once again no doubt a publicly-owned entity will run it and make a profit again until, as you say, it is given back to yet another private company to fail yet again. Madness.
johnthefireman wrote:Third time! Twice before since privatisation private companies have failed running this line. In both cases they were taken over by publicly-owned entities which poceeeded to make a profit. Now a third private company has failed, and once again no doubt a publicly-owned entity will run it and make a profit again until, as you say, it is given back to yet another private company to fail yet again. Madness.The minister in charge has said the government company will be called London and North Eastern. I am not sure what label it has at present.Is it GNER or did that go bust earlier?
Well , I'm glad NZ is not the only country that has had to do this,( and compensate the foreign company for the "taking" , no less ). At least there is no sign of them selling it back private here, any of that kind of thinking is focused on shutting it down .
Whats the difference between the east coast route , and the west coast route,? If anything i would have thought the east coast is simpler to run. Not as much intermedaite traffic , perhaps ?
Whats the difference between the east coast route , and the west coast route,? If anything i would have thought the east coast is simpler to run. Not as much intermedaite traffic , perhaps ?
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The only train trips I regret are the ones I didn't take.
The only train trips I regret are the ones I didn't take.
David Benton wrote:Well , I'm glad NZ is not the only country that has had to do this,( and compensate the foreign company for the "taking" , no less ). At least there is no sign of them selling it back private here, any of that kind of thinking is focused on shutting it down .It's not that the Tory government "had to" privatise BR. They had some daft ideology which inspired them. Some people have argued that BR had so modernised the system and made it profitable that it was tempting to sell the assets to private companies. But the reality was that they didn't actually privatise the system. They merely created a number of franchise contractors. When they did sell off the fixed assets, the company Railtrack which acquired the track and some of the stations failed to make a profit and went bankrupt. It had to be renationalised as NetworkRail.
Whats the difference between the east coast route , and the west coast route,? If anything i would have thought the east coast is simpler to run. Not as much intermedaite traffic , perhaps ?
The east coast route has always been seen as a competitor with the west coast route. But is that sensible in modern conditions? I don't think so. I don't know why the contractors on the east coast failed to make money. One reason being claimed is that they agreed to pay the government to operate the route but not enough passengers appeared due to the recent recession. So they were making a loss. The right wingers always claim that they have the perfect system for everything. But they are deluded.
george matthews wrote:GNER was the first to go under, around 2006.johnthefireman wrote:Third time! Twice before since privatisation private companies have failed running this line. In both cases they were taken over by publicly-owned entities which poceeeded to make a profit. Now a third private company has failed, and once again no doubt a publicly-owned entity will run it and make a profit again until, as you say, it is given back to yet another private company to fail yet again. Madness.The minister in charge has said the government company will be called London and North Eastern. I am not sure what label it has at present.Is it GNER or did that go bust earlier?
Second was National Express East Coast, which collapsed in 2009.
Virgin Trains East Coast is the third after the partnership overbid on the franchise, and when passengers numbers didn't increase as predicted has resulted in losses of £100m so far.
The bad bet at the heart of the East Coast rail franchise implosion
Virgin Trains bosses did not conceive that passenger numbers could fall after two decades of consistent growth
johnthefireman wrote:The bad bet at the heart of the East Coast rail franchise implosionI have seen it stated that National Express had by far the largest stake in the franchise, and Virgin rather little. But really this event ought to show that the franchise system is not a good idea and should be abandoned.
Virgin Trains bosses did not conceive that passenger numbers could fall after two decades of consistent growth
Yes, I believe it was something like 90% to 10%.
george matthews wrote:The 90% was Stagecoach.johnthefireman wrote:The bad bet at the heart of the East Coast rail franchise implosionI have seen it stated that National Express had by far the largest stake in the franchise, and Virgin rather little. But really this event ought to show that the franchise system is not a good idea and should be abandoned.
Virgin Trains bosses did not conceive that passenger numbers could fall after two decades of consistent growth
National Express was the 2nd franchise to fail (National Express East Coast), with the first being GNER.