DB to buy Grand Central

[Philip Elliott]

After DB Regio's purchase of Laing Rail,

Point of order - DB Regio (ie German regional railways) did NOT buy Laing Rail. It was bought by Deutsche Bahn AG - the overseas investment arm which also owns Arriva. Laing Rail was subsequently rebranded as 'DB Regio UK ltd'.

'Schenker' is a pan-european freight shipping company that was purchased by DB in the 1990s (having previously held a share years before but selling to plug the subsidy gap).

 

[Adam_Harrison]

The West Riding Route usually sells out its Reservations for most trains and as David said quite a few do get on at Hartlepool and Eaglescliffe. It can vary though, i've seen anywhere from 30 to 70 for southbound and 0-20 Northbound.

 

[LNW-GW Joint]

Point of order - DB Regio (ie German regional railways) did NOT buy Laing Rail. It was bought by Deutsche Bahn AG - the overseas investment arm which also owns Arriva. Laing Rail was subsequently rebranded as 'DB Regio UK ltd'.

Not quite. DB AG is the holding company for all of the DB Group, which includes DB Bahn in Germany (long distance and regional), also Schenker and Arriva abroad.
http://www.deutschebahn.com/site/bahn/en/group/business__units/business__units.html

Arriva in the UK is split into Trains (which includes Tyne & Wear Metro) and Buses.
Arriva Trains ownership is shown in http://www.arriva.co.uk/arriva/en/business_activities/transport_services/unitedkingdom/trains/

But all this corporate stuff is really badly presented, sometimes in ambiguous English, and I still don't know how DB Regio UK, if it still exists, fits into Arriva.
DB AG themselves keep on about DB Mobility Logistics as being the parent body. We know the names of the top people running UK rail companies (Branson, Souter etc), but I couldn't tell you who is "Mr DB" in the UK.

Anybody know any better?

My guess is that all the UK passenger operations will eventually be rebranded as Arriva, which is why I think class 67s have started to be repainted in Arriva colours.
Whether we will see Chiltern and XC operations in Arriva colours I'm not sure.
Maybe the class 67 fleet, as passenger locos, will transfer to Arriva.

The DB German long-distance operation is the one which is planning international services to St Pancras with ICEs, not Arriva.

 

[yorksrob]

Back to ownership of DB.
The subtlety may be lost on some people, but I think it's worth re-emphasising that DB is not a "state run" railway in the sense that is once was.
DB is a "private" company, that happens to be owned 100% by the German state.
Some may think that's just semantics, but there's a subtle but important difference in that.


.
.

Bearing in mind that BR was explicitly forbidden from developing such an arrangement, It would seem to me that having British railway operations taken over by a "private company" in which the state owns a controlling stake of 100% is deeply contrary to the spirit of the railways act.

 

[142094]

I think you'd be surprised... there's quite a few get on in Hartlepool & Eaglescliffe, on all services...

I agree with @omgitsdave it is suprising how many people do board at eaglescliffe and Hartlepool I believe that if a journey to edinbrough and Glasgow was introduced even 2 a day it would create greater demand

You will be surprised at how many Sunderland people have to travel or do travel to Newcastle and Durham just to get access to the east coast.

GC originally only had three trains from Sunderland to london than as demand increased so did supply to four trains they did ask for five trains I believe but was refused due to space on the ecml

But the main flow is still King's Cross - York. The price difference between a Sunderland - King's Cross single ticket and a York - King's Cross single ticket one way is £9. £9 is not a great deal more return for a journey that takes about an hour and a half. Plus you are not guaranteed that everyone who gets on at Sunderland/Hartlepool/Eaglescliffe are going through to London. A good deal of those using GC north of York going southbound are day trippers going to York.

In simple facts, the York - King's Cross flow is where GC make the money. North of York will most probably make a loss, which is covered by the profits on York - KGX and the ORCATS revenue.
--- old post above --- --- new post below ---

We know the names of the top people running UK rail companies (Branson, Souter etc), but I couldn't tell you who is "Mr DB" in the UK.

Anybody know any better?

Mr DB in the UK was Adrian Shooter until he announced his retirement.

 

[tbtc]

you are not guaranteed that everyone who gets on at Sunderland/Hartlepool/Eaglescliffe are going through to London. A good deal of those using GC north of York going southbound are day trippers going to York

...or even shorter journeys like Sunderland - Hartlepool (given the fact that Northern only run hourly on that section).

 

[LNW-GW Joint]

Mr DB in the UK was Adrian Shooter until he announced his retirement.

No he wasn't.
He did not speak for Schenker or Arriva.
Just shows how poor the corporate PR is.

On the "nationalised state railway" subject, there is no way DB in the UK is supported by the German state. They have enough of their own problems at home.

 

[shinkansen1966]

On the "nationalised state railway" subject, there is no way DB in the UK is supported by the German state.

Indeed. Why would the Germans buy a train operator which was actually loosing money ?

TOCs don't loose money. They have three sources of income: ticket sales, a subsidy from the government (in many cases), plus additional income from retail units and parking charges. I'm willing to guess that Arriva Trains Wales, Chiltern Railways and Arriva XC all make money for Arriva and DB.

 

[BananaRepublic]

No he wasn't.
He did not speak for Schenker or Arriva.

I may be wrong, but I stongly suspect that DB Schenker Rail (UK) are totally separate from DB's Arriva UK Trains and their particular "food chain" routes up via the DB Schenker organisation back in the Homeland.
If that's correct, then at the highest level there are two DB companies in the UK, reporting back to their respective parent divisions in Germany.

PR is indeed a bit crap. Anybody from the "inside" able to help here?

.

 

[Snapper]

I'm under the impression that GC although mAde a loss there projected loss was better than predicted if that makes sense

GC always anticipated that they would make a loss for first 4yrs off the top of my head
I do believe they want to expand to create a Blackpool service too

http://www.yorkpress.co.uk/news/9210250.Rail_firm_makes_loss_of___8_5m/

 

[142094]

No he wasn't.
He did not speak for Schenker or Arriva.
Just shows how poor the corporate PR is.

Yes he was, for DB Regio at least. Now, with the reorganisation and his retirement it is hard to tell who does what.

 

[hick]

Yes he was, for DB Regio at least. Now, with the reorganisation and his retirement it is hard to tell who does what.

For DB Regio UK until DB bought Arriva and then since approx January it's been Bob Holland of Arriva

 

[WillPS]

The units and paths are only "leased", there's not the same guarantees that you'd have running a "real" franchise, you'd be effectively ruling yourself out of winning the lucrative East Coast franchise... and thats before you factor in the fact that they are losing money every year.

What do you base this on? Would First also be declined for similar reasons? I've never known of a TOC franchise bid being declined on the grounds of competition.

 

[Oliver]

Is it a coincidence that DB's UK rail division* is headquartered in Sunderland?


*or "Arriva", as they seem to like calling themselves

Er, yes it is a coincidence. Arriva have been based there since they were a bus company and part of the Cowie group IIRC.

 

[142094]

Funnily enough I was talking to a manager high up in Cross Country and someone mentioned Arriva buying GC - he looked a bit flustered to say the least.

 

[Oliver]

TOCs don't loose money.

Well GNER lost enough money to put it out of business.

 

[91101]

Sorry, but that is NOT correct.

GNER was a fully profitable business with a working business plan to pay back in premium payments 1.3BN over an initial 10 year franchise May 2005 - 2015.

SeaContainers, the owning company of GNER, had its core business in a total meltdown, and was itself virtually insolvent.

The TOC's must deposit a "performance bond" with the DfT in the event of a default. (Like a deposit you pay to rent a house or a car) this must be paid from the owning group and under whatever accounting regulations, cannot be money taken out of the franchise business itself. Because of the issues further up in SeaCo, this performance bond in 2007 was due to almost quadruple. As a result, this left SeaCo in default of its franchise agreement, and as a result, the DfT took the decision to terminate the franchise.

SeaCo subsequently went bankrupt and is no longer trading.

It should be noted, that GNER was paying 1.3bn back over a 10 year franchise. NXEC was let and was let from December 2007-May 2015 (The remaining 7 and a half years of the GNER franchise) and they promised to pay 1.4bn over the 7.5 years. It should also be noted that EastCoast is paying money back into the DfT in the same way a franchise would pay a subsidy, and they are paying back at the same levels that GNER would have been!!

(Sorry rant over)

 

[DaveNewcastle]

Well GNER lost enough money to put it out of business.

Did they?
I know its a popular comment to make, but is there any evidence to support your assertion, please?

 

[ChiefPlanner]

GNER took a bit hit with the fallout from the London bombings (as optional London traffic fell off big time) , as well as the above mentioned issues with the parent holding company. A very sad loss of a great brand and TOC.

 

[142094]

Quite unfortunate double whammy for GNER - lower patrinage and the problems with Sea Containers. Perhaps GNER would have kept going if it was a stand-alone business and not involved with Sea Containers, which is a shame. I'm a regular user of the ECML and GNER has been the best TOC to run on it so far, much better than NatEx, and EC are getting there slowly.

 

[DaveNewcastle]

. . . . . and EC are getting there slowly.

There are a few who would disagree with that last point!
Some of them passengers and some of them staff. "Downhill steadily for the past six years" was one recent comment.

 

[BOSCH]

Frantic on facebook at the minute amongst GC staff about this,it looks almost certainly true like !!! hock:

 

[stanley T]

Ist is mit Gründ Central? Schnelll!!!!

Grosse Mitteländer Züge, I suppose - actually it would probably be all one word in German

Makes for a nice American-style abbreviation, the GMZ (gee em zee)

 

[BOSCH]

Could be Deutsch Bahn mackem Bahn !!!

 

[YorkshireRider]

Quite unfortunate double whammy for GNER - lower patrinage and the problems with Sea Containers. Perhaps GNER would have kept going if it was a stand-alone business and not involved with Sea Containers, which is a shame. I'm a regular user of the ECML and GNER has been the best TOC to run on it so far, much better than NatEx, and EC are getting there slowly.

It was indeed a unfortunate double whammy, but other bids at the time of 2005 from Virgin and First were much less than GNERs with far more slack built in to allow for rough economic times. GNER also never took into account the possibility of more open access operators on the ECML even though the franschise agreement never prohibited this. They kicked off and threated legal action when GC started but on what grounds i dont know. The directors of GNER have to take their fair share of the blame for its demise, i doubt as a stand alone company it would have been able to make its payments anyway.

Yes it is getting slowly better under EC, with the overhaul of the 91s coming next which is badly needed but it was always going to be slow going after 5 years of no direction and little investment.

 

[WillPS]

I think this is excellent news if true.

 

[ainsworth74]

I think this is excellent news if true.

I suspect it won't be if you use GC's Bradford service, because assuming the rumour are true and the operation loses money hand over fist I wouldn't expect DB to sit around for long waiting for it to break even.

 

[BOSCH]

Its official,Grand Central are now part of the Arrriva(UK) family,emails to all staff earlier this morning !

 

[AlterEgo]

Breaking news: Arriva (DB) have concluded their purchase of Grand Central, this morning.
--- old post above --- --- new post below ---
Ah damn, I wanted to be first!

 

[BOSCH]

Breaking news: Arriva (DB) have concluded their purchase of Grand Central, this morning.
--- old post above --- --- new post below ---
Ah damn, I wanted to be first!

Unlucky !!!!