NXEA given extension

[MCR247]

National Express East Anglia has been given a seven mouth extension by DfT to it's franchise.

National Express Group has won an unexpected extension of its East Anglia franchise, and city observers are hoping that the development is an indication that its frigid relationship with Government is starting to thaw.

Troubled NXG became unpopular with ministers last year, when slack revenues forced it to relinquish the East Coast franchise only a short time after taking over as the successor to GNER, which had also failed for the same reason.

The transport secretary at the time, Andrew Adonis, claimed that NXG’s failure on East Coast would entitle him to terminate the group's other franchises of East Anglia and c2c. This interpretation of the rules was disputed, and never put to the test in court.

Instead, Lord Adonis made sure that no NXG franchise extensions, which had been optional, would go ahead, and it was rumoured a year ago that National Express could be preparing to abandon the rail industry altogether.

As things stood at the time of the election in the spring, both East Anglia and c2c would have ended in 2011.

But now the DfT has relented sufficiently to allow a modest extension of the NX East Anglia contract, of seven months.

It's understood that a further extension could follow, and that talks are also underway about extending the c2c contract as well.

http://www.railnews.co.uk/news/business/2010/09/15-national-express-relationship-with-dft.html

 

[transportphoto]

I was going to post this this morning but I could not find a report on it.

Some say (myself included) "They are being rewarded for failure."

 

[Big Chris]

Well this makes the DFT look amazingly strong willed doesn't it.

 

[KentonCanary]

There's a quote in today's Telegraph from a "City Analyst" who pointed out that both franchises (NXEA + 1 other) were pivotal to the success of the London 2012 Olympics and that there could be a case for leaving them with "the devil you know". His gut feel is they will be left in situ until the other side of the Olympics.

I'm quite happy with this as I deal with NXEA on a regular basis; I look after the train travel for the Capital Canaries (Norwich City London Supporters Club) and for the last few years they've given us a very good deal on weekend group travel between Norwich and London.

NXEA may not be everyone's cup of tea but they've been very good to us over the years.

 

[shinkansen1966]

think it has as much to do with the expiry date of C2C and NXEA contracts as much as anything else. Under new govt, DfT doesn't yet have a specific rail franchise policy. So extentions of existing contracts buys some time for all concerned.

 

[ainsworth74]

National Express East Anglia has been given a seven mouth extension by DfT to it's franchise.

How many mouths did it have before

I have to say I go along with shinkansen on this one, this has been caused by a lack of any policy at the DfT rather than anything more sinister. I still expect NX to lose East Anglia just not till we know how were going to re-let the franchise.

 

[rail-britain]

From memory details of this appeared on the DfT website some time ago
It was unsure how to proceed with the NXEA franchise, but was considering a short-term extension rather than an offset renewal
This would then bring the expiry date inline with two other franchises, all of which will be merged when due for their renewal

 

[shinkansen1966]

As far as I know, Virgin have asked DfT for an extention on their West Coast contract. Not sure what's happening there.

 

[rail-britain]

As far as I know, Virgin have asked DfT for an extention on their West Coast contract. Not sure what's happening there.

I'm not aware of that one, as an extension had already been agreed upon, to the franchise renewal, hence why the "new" Class 390s would not be entering service (as terms on their use and costs couldn't be agreed)

 

[NLC1072]

Anybody got any ideas of when the franchise is finished, for both C2C and NXEA, who'd be in the running to take them over?

 

[sprinterguy]

Agreeing with shinkansen here, the only reason that NXEA have been given a franchise extension is because the DfT is developing railway franchises version 3, so they're waiting until they have finalised that until they relet any franchises, so that all future franchises will be let under the new scheme. We can expect franchise extensions on most of any other franchises that come up for renewal in the next couple of years I expect.

 

[shinkansen1966]

We can expect franchise extensions on most of any other franchises that come up for renewal in the next couple of years I expect.

Agreed. Indeed, just how many contracts are supposed to be coming up for renewal between now and say end 2012 ? Remember, even if DfT has new policy developed during 2011, and they issue tender bids for new contracts, it'll take a year for process to lead to a new contract being signed off and ready.

You'll see I'm using the word contract rather than franchise. More convinced they are contracts.

 

[sprinterguy]

You'll see I'm using the word contract rather than franchise. More convinced they are contracts.

Given the amount of micro-management by the DfT, and the number of performance measures that have to be met, I'd say that contracts is a fair way to describe them

So, "franchises" finishing between now and late 2012:
NXEA and C2C (the same thing now of course) have already been given an extension.

Southeastern are due to finish in March 2012 but have the option of a two year extension, so will probably get one.

Northern are meant to run through until September 2011, with the option of a two year extension, so watch that happen too.

FCC runs until 2012, may have a five year extension to 2017. Not sure about that one, but I don't see why they wouldn't get an extension.

TPE runs until February 2012, but again have the opportunity for a five year extension to 2017.

Of the other franchises, many of them finish in 2013/14, so I'm expecting a big bout of refranchising to occur with those and most of those above in 2013/14 immediately ahead of the next General Election, where we will not have a coalition government for the next term.

If I can continue my predicting, I can also see First group getting the East Coast franchise and Govia getting the West Coast, so that there are single operators operating out of the two anglo-scottish London Termini (LM & West Coast out of Euston, FCC and EC out of Kings Cross). I reckon the Govia takeover of West Coast will be allowed to happen at the natural end of the Virgin franchise in 2012, with no extensions granted to VT, and I also think that Virgin will then put in a strong bid for the East Coast.

 

[57315]

We will wait and see when the Dft decide to do another restructuring of the countrys rail franchise network.

 

[driver9000]

Northern had it's extension to 2013 granted earlier this year.

 

[sprinterguy]

Northern had it's extension to 2013 granted earlier this year.

Ah, there's that one sorted then, I probably should have known that, thought it rang a bell...

 

[shinkansen1966]

I can also see First group getting the East Coast franchise and Govia getting the West Coast, so that there are single operators operating out of the two anglo-scottish London Termini (LM & West Coast out of Euston, FCC and EC out of Kings Cross). I reckon the Govia takeover of West Coast will be allowed to happen at the natural end of the Virgin franchise in 2012, with no extensions granted to VT, and I also think that Virgin will then put in a strong bid for the East Coast.

Looks a realistic and plausible scenario.

From what little has been said, coalition policy is to get DfT out of micro-managing. And would have benefit of letting TOCs get on with making their own mistakes. Also means less policy work for govt. Any thoughts on when will see our all first coalition rail policy contract/franchise. Mid 2013 ?