The point was more to do with the amount of money that the cost per seat would be compared with the cost of a ticket. Therefore what appears to be expensive now will not be expensive in 25 years time.
Likewise comparing the cost of old trains with brand new trains isn't the same, especially as the new trains include the cost of maintenance.
If the IEP order such bad value it's then surprising that GWR has ordered AT300's.
The trains in the IEP are paid for according to the diagrams they fulfil. The are no published figures for the capital cost of the trains - and therefore NO figures for the capital cost per seat are available.
The payment made for each diagram that the trains fulfil covers design, component testing, manufacture, shipping, assembly, type approval testing, the cost of the three maintenance depots and some of the costs of the new factory, running maintenance, consumables, cleaning and the interest on the money Hitachi has had to borrow to pay for all the costs incurred before it receives the first payment when the first train enters service.
No information has been made available regarding the way the Train Service Provision payments for the IEP will vary with time over the next 27.5 years - the headline figure published is the Net Present Value of the whole contract. One would expect the payments to be linked to inflation in some form or other but it is impossible to say whether the trains will become relatively cheaper in future or not.
In addition, if a buyer for any item (train, car, fridge, microwave oven, whatever) is not prepared to accept any risks and states that it has to be available when agreed (up to 27.5 years away), then he will pay through the nose in order to sleep easy.
The IEP is eye-wateringly expensive because the DfT has loaded ALL of the costs since Agility Trains was selected as preferred bidder in 2009 as well as all the design, operational and financial risks onto the cost per diagram. Agility Trains/Hitachi will have been racking up costs for some 8 or 9
years before it receives a penny. Work out what that is in interest alone.
The whole point of the numbers that I quoted from the ORR data is that they cover both the capital lease costs of the stock AND the maintenance costs. They are the costs to the TOC of running the trains.
The AT300s are being ordered under a completely different financial regime - it is the usual structure whereby a ROSCO, in this case Eversholt, is financing the purchase of the trains, 173 vehicles at a cost of £361 million. Maintenance will be arranged under a separate contract. Risks are shared between the parties.
