Great Western franchise to be broken up?

[Chris M]

(And one of the other transport industries nationalised in 1948, the inland waterways, has now been entrusted to the charity sector, though I wouldn't claim they are comparable!)

The inland waterways conversion to a charity was a denationalisation for party political reasons for the same reasons the railways were privatised. The only difference is that it was realised (whether internally or solely by lack of interest I know not) that no private sector organisation could (or maybe just would) take it on with a realistic hope of making money.
The Canal and Rivers Trust is the Network Rail equivalent, but without the viaduct arches or station retail to make money from and no real scope for significantly increasing the income from vehicle operators.

 

[Bantamzen]

How many rail-capable operators are out there do you think, who are not already involved?

You missed Keolis by the way (and now Trenitalia).
MTR also have Crossrail.
HEX and Eurostar are not franchises.

Renfe once tried for ICWC.
Japan is interested - JR East is bidding for West Midlands; Mitsui is also in there.
Connex gave up and NX have now thrown in the towel.
BA once had an interest in Eurostar.
DB might yet operate on HS1.

There's also limited Open Acess (currently First and Arriva).
Some infrastructure firms are hovering (eg Amey who now run DLR with Keolis and are bidding for Cardiff Valleys Metro), and John Laing .
No other UK operator has emerged.
What sort of competition do you want?

Competition is relatively easy in the bus sector (few barriers to buying a vehicle, licencing a service, finding employees with relevant knowledge/ skills), but how easy do you want to make it for new bidders into the rail market?

Who are the organisations you feel should be bidding for franchises (who currently aren't doing so)?

You both misunderstand the point I'm making. Public transport was privatised under the guise of giving the public more choice by offering competition. This happened only briefly in certain areas with the buses, before the big 4 hoovered up most of the best routes and left most of the scraps to the smaller operators. And the competition on the rails never materialised for obvious reasons, and now we see 4 or 5 companies dominating the market. How long you do think it will be before at least one or two of the big 4/5 in the bus and rail sectors merge or get taken over by one another? DB came very close to selling a significant stake in Arriva, and once we leave the EU there will be the potential for the competition rules to be slackened and the big 4 become the big 2 or 3, or even eventually 1.

Yet the government still to this day tries to play the competition card even though it is obvious that market forces will determine that only the biggest and fittest survive in the long run, meaning that competition will decrease not increase.

 

[NSE]

And why should the Hastings line have "competition" where the Chatham line and the SEML has none - just because it is on the edge of a franchise boundary? That's not how the system was ever supposed to work.

I think the point was more to indicate how an unsuspecting travelled could turn up at Hastings and go 'Ah! Choice! I'll take the Southern route because, it may be slower, but I like it, I'd rather give them my money because I like to travel with them. Fantastic! Take that owners of SouthEastern!' Unbeknownst to them, the money ends up in the same Govia pot.

 

[TUC]

On-rail competition is irrelevant - the number it fights over is tiny. The competition is the car.

On rail competition gets cheaper fares on flows where it exists, such as Doncaster-London.

 

[LNW-GW Joint]

You both misunderstand the point I'm making.

I get your point now.
But the "Big 4" is a lot better than the "Big 1".
And Big 4 essentially works for banking, TV, telecoms, airlines etc.
The UK market isn't big enough to support many more operators with the economy of scale needed to be efficient.
Even in the free market US there are only a handful of major operators, and only two west of the Mississippi.

The original privatisation did intend to roll back to pre-grouping with a dozen or more competing operators (though there were never more than 2-3 in any one area).
But economics has brought it back to 4-ish.
The Brown report recommended a larger number of smaller franchises to encourage new entrants and reduce the risk of failure, but it hasn't happened yet.
As NX has shown, the franchise system doesn't encourage long-term investment by operators in rail, as the assets always revert to the government in the end.
And I agree it's a pity the TOCs are dominated by bus interests.
An easyRail TOC would shake things up a bit.

 

[Clip]

I don't remember any competition to Hastings/Tonbridge even in Victorian days - The SER had it sewn up as a monopoly.

Im surprised you are still with us from the Victorian days if you can remember it that well

 

[Doctor Fegg]

The inland waterways conversion to a charity was a denationalisation for party political reasons

It honestly wasn't. The conversion was first suggested by British Waterways, not by Government, and there was cross-party and majority stakeholder support for it.

Richard (former editor Waterways World magazine, former BW employee)

 

[MarlowDonkey]

Gosh - I hadn't appreciated how much Thames dominated the Oxford route (and how few HSTs ran London - Oxford back then)

Would that have been a hangover from the Inter-City/Network South East split? Oxford was part of NSE which got the loco hauled trains whilst Inter-City had all the HSTs.

If electrification was going to reach Oxford in the near future, all the electric services could perhaps be hived off into a Thames Mk2. Using the bimodes for Oxford services complicates matters as they would be operated by the "long distance" franchise.

 

[takno]

Would that have been a hangover from the Inter-City/Network South East split? Oxford was part of NSE which got the loco hauled trains whilst Inter-City had all the HSTs.

If electrification was going to reach Oxford in the near future, all the electric services could perhaps be hived off into a Thames Mk2. Using the bimodes for Oxford services complicates matters as they would be operated by the "long distance" franchise.

Most of the fast services to Oxford carry on past there. Are you suggesting they should be a different operator?

 

[HowardGWR]

WEll thats us down here on the SWML *uggered as we will get more life expired kit while the GWML sector gets the AT800's 16X 397's etc and we end up with 143's 153's and worse with slow trains to the south west to replace the venerable HST's that have never been allowed to run properly over the B+H and beyond, until the next dawlish event whereupon the trains will terminate at Exeter.

At least your post is on topic, congrats! I could see the present London end suburban service, as far as Reading, being absorbed by LT, but clearly not under this government, or unless a Tory wins the London mayorship, back.

I can't see any point in other than minor alterations needing to be made, in the light of new services. E.g. if a through service from Exeter to Southampton via Dorchester were proposed, one would imagine it would be added to SWT's franchise, given that it would be part of a split at Yeovil from the present 159 service to Waterloo. Yes, perhaps a pipe dream, but that sort of thing.

One could also see both Bristol and Cardiff suburban services being locally managed, as with the LT example.

 

[daikilo]

What is not obvious to me is the Minister's intent
1) devolve decision making
2) create a partnership/s between the TOC and NR
3) create competition by splitting parts off the current GWR TOC to create or add to one or more others

If the intent is (3) then obviously it is not desirable to split the service frequency between say 2 TOCs.

What could be done would be to create a new TOC for local services with the aim that they would have a lower fare structure in exchange for slower journey times and higher density seating, but what about connections with GWR and would the new TOC be identified as loss-making? Also, where would it end (Plymouth, Exeter, Bristol ...).

Finally, what happens with Cross-Country which currently provides a sort of competition for some regional journeys.

And the above is only part of the GWR network, so what happens to all the rest. Also, if this is the DfT intent then what happens to the rest of the UK?

 

[WelshBluebird]

And Big 4 essentially works for banking, TV, telecoms, airlines etc.

I'd personally say it isn't working for 3 out of those 4 as I wouldn't say we really have good competition for banking, TV or telecoms. And of course it doesn't work at all when it comes to energy companies either.

 

[LNW-GW Joint]

I'd personally say it isn't working for 3 out of those 4 as I wouldn't say we really have good competition for banking, TV or telecoms. And of course it doesn't work at all when it comes to energy companies either.

What I meant was that 4 competitors is about the number the UK market gravitates to.
That's dictated by the cost of corporate things like IT systems, HR and industry standards.
Below a certain size it won't work, and rail has very high entry costs.
At the end of the day we are a small market by global standards.
It will be even smaller outside the EU and possibly missing Scotland.

 

[coppercapped]

You both misunderstand the point I'm making. Public transport was privatised under the guise of giving the public more choice by offering competition.

No, this is wrong. Any idea of on-rail competition was dropped in the run-up to the 1993 Act.

The competition was for the franchise - it was never intended that there should be competition between the franchises. This is why systems were set up to ensure tickets are transferrable between TOCs and why fares income is divvied up between the operators.

If competition between the franchises were the intention of the 1993 Act then each company would have sold tickets valid only on its own trains and the tickets would not have been transferrable between operators.

The background to the privatisation process has been exhaustively described and analysed in books and papers. I do not comprehend why people continue to misrepresent the situation.

 

[HH]

An easyRail TOC would shake things up a bit.

It's been thought about...

 

[The Ham]

An easyRail TOC would shake things up a bit.

"Welcome aboard the 07:45 Easy rail service to London Woking, Calling at Southampton (Totton), Winchester (Eastleigh), Basingstoke (Hook) and London Woking."

 

[maniacmartin]

If competition between the franchises were the intention of the 1993 Act then each company would have sold tickets valid only on its own trains and the tickets would not have been transferrable between operators.

Indeed. However since privatisation we've seen a gradual ramping up of prices for cross-operator tickets, with single-operator tickets (especially Advances) being introduced ever more widely. This squabble over revenue between TOCs reduces the flexibility of affordable tickets, and I believe makes travelling by car ever more attractive.

 

[meridian2]

The problem is lack of supply, leading to lack of competitiveness. Many of the northern routes I'm familiar with used to be served by diesel hauled 7 to 10 coach trains. Now passengers are offered 2 or 3 coach trains. Yes, they're more frequent, but not sufficiently so to make up for the shortfall in capacity.

Under the 1980s model a single train operator could have supported however many private ticket sales companies was necessary for genuine competition. As things stand, under-capacity ensures regular passengers will pay whatever ticket price TOCs insist upon, while those travelling on a casual basis can pick up the inexpensive crumbs and companies can represent their service as a "bargain".

Under a privatised ticketing system, companies would exploit split ticketing and other anomalies and present travellers with a single best value ticket. While ever there is under capacity there can be no competition, it's merely a series monopoly and Hobson's Choice.

 

[dgl]

"Welcome aboard the 07:45 Easy rail service to London Woking, Calling at Southampton (Totton), Winchester (Eastleigh), Basingstoke (Hook) and London Woking."

Using whatever stock is available for bargain bucket prices, well if the problems with the 230 can't be sorted can you just convert them to 3rd rail and use them.

And that is the real problem. If you had competition would that create true competition or would it be a race to the bottom? i.e. would you get a budget operator say using the equivalent of 450's and a more expensive higher quality operator using 444's or would they both use what is cheapest trying to be cheaper than the other or decide that stopping at every station will give them more passengers and make them more money making journeys slower.

 

[meridian2]

If you had competition would that create true competition or would it be a race to the bottom?

HS2 suggests a race to the top is more likely.

 

[40129]

Using whatever stock is available for bargain bucket prices, well if the problems with the 230 can't be sorted can you just convert them to 3rd rail and use them.

And that is the real problem. If you had competition would that create true competition or would it be a race to the bottom? i.e. would you get a budget operator say using the equivalent of 450's and a more expensive higher quality operator using 444's or would they both use what is cheapest trying to be cheaper than the other or decide that stopping at every station will give them more passengers and make them more money making journeys slower.

Unfortunately, the only way to find out would be for such competition to actually happen across the network, as comparisons with bus and coach deregulation gives conflicting results. Coach service deregulation generally resulted in better quality vehicles and higher frequencies, whereas bus deregulation very quickly initiated a race to the bottom with newcomers using low cost, low quality vehicles with drivers being paid as little as possible. Even today, bus operators are having licences revoked as a result of unlawfully low standards of operation.

One thing the rail industry does not appear to have learned from the bus industry is that increased frequency leads to increased demand so the total number of seats also needs to increase not decrease. Anyone else remember 16 seat breadvans 'improving' their local bus service?

 

[40129]

Re Easy Rail: I believe there already are proposals for a service terminating at London Queens Park

 

[meridian2]

Re Easy Rail: I believe there already are proposals for a service terminating at London Queens Park

Perhaps a mega-station on the outskirts of London is the way forward, with tube, train and bus services competing for the local traffic it brings?

 

[Bletchleyite]

Perhaps a mega-station on the outskirts of London is the way forward, with tube, train and bus services competing for the local traffic it brings?

Competition over local traffic is nuts. It doesn't work.


Sent from my iPad using Tapatalk

 

[LNW-GW Joint]

Re Easy Rail: I believe there already are proposals for a service terminating at London Queens Park

That's because there are no paths into Euston (because of redevelopment for HS2).
It's not the preference of Alliance, and in any case it won't save them money (which is why the LCC airlines avoid the expensive airports).
Alliance will run into Euston if NR can find the paths (if they ever order any trains, that is!).

 

[meridian2]

Competition over local traffic is nuts. It doesn't work.

You may be right, but part of the problem seems to be pathing into the existing termini. There appear to be routes with capacity outside the capital, but only Crossrail type solutions within it. Grand Central offer a service via less used stations, and I'd imagine there are other operators who would use a satellite station. The issue is developing a shuttle with sufficient capacity to get people to the centre. Heathrow users have the same issues, but a solution has been found.

 

[daikilo]

One thing the rail industry does not appear to have learned from the bus industry is that increased frequency leads to increased demand so the total number of seats also needs to increase not decrease.

I don't know whether the rail industry learnt it from the bus industry or all by themselves, but it has happened, and is a key reason why there aren't enough seats available.

As to alignment with easyJet, they actually fly to major airports unlike some other LCCs, and what was the Ryanair business model (now evolving).

 

[Joe Paxton]

That's because there are no paths into Euston (because of redevelopment for HS2).
It's not the preference of Alliance, and in any case it won't save them money (which is why the LCC airlines avoid the expensive airports).
Alliance will run into Euston if NR can find the paths (if they ever order any trains, that is!).

The submission I recall reading to the ORR from London Underground, who manage Queens Park station, wasn't exactly glowing with enthusiasm of this proposal given the issues it would bring.

 

[coppercapped]

Indeed. However since privatisation we've seen a gradual ramping up of prices for cross-operator tickets, with single-operator tickets (especially Advances) being introduced ever more widely. This squabble over revenue between TOCs reduces the flexibility of affordable tickets, and I believe makes travelling by car ever more attractive.

Car travel may well be more attractive - but that doesn't mean that more people are doing it.

The DfT's figures show that car mileage peaked some five or six years ago and since then has, at best, remained stable or fallen slightly. Rail traffic, on the contrary, has continued to grow. Clearly the prices charged and reduced flexibility of some ticket types are not putting people off travelling by train.

There is no 'squabble' over revenue - if an operator has spare capacity on some trains at some times of the day or week then I don't see why it should not try to sell it. The limitations on the tickets validity are to ensure that only the targeted trains carry the extra passengers.

 

[coppercapped]

The submission I recall reading to the ORR from London Underground, who manage Queens Park station, wasn't exactly glowing with enthusiasm of this proposal given the issues it would bring.

Did London Underground, by which I expect is meant TfL, not want the extra business?