Will Virgin East Coast mean an end for Open Access Operators?

[MK Tom]

I think VTEC might end up being a bit quicker than the GC route. A fast run to Newcastle normally takes about two hours fifty minutes, figure maybe twenty minutes to get to Sunderland giving roughly three hours and ten minutes. GC take three hours and thirty to do Kings Cross to Sunderland. Obviously those are only rough estimates on my part.



But by saying VTEC shouldn't be expanding into areas currently served by OAOs aren't you effectively saying that there shouldn't be competition? If the OAOs are competing against VTEC on some flows (London to Doncaster/York primarily) why shouldn't VTEC compete against them in other areas (via different routes no less)? Competition is good after all...

VTEC doing that as their own initiative is great. It's the DfT part I have an issue with.

 

[hairyhandedfool]

Which, while true, is completely irrelevant for this thread given that nobody has said that it's Virgin and not Virgin Trains East Coast...

Nobody huh?

Looking at the Virgin Trains East Coast proposals I notice that they plan a London to Sunderland train from 2015 which reminds me of a time which Wrexham and Shropshire started operating Virgin Trains introduced a London to Wrexham via Chester train which was obviously there to compete with the then new Wrexham and Shropshire service.

I also notice that they plan to introduce more London to Bradford Forster Square services which because Bradford is currently served by open access services operated by Grand Central I can imagine that it will do the same thing of getting passengers onto their trains rather than Grand Central.

Given Virgin West Coast's previous history of stopping any competition with moderation clauses, filling demand if its there is a demand there and offering better fares than competitors which they have done to Wrexham and Shropshire and the First North Western London services could the same thing happen now with Virgin Trains East Coast?

I am of the opinion that open access operators were partially to blame for GNER and NXEC failing finacially so could Virgin Trains East Coast try and end that trend?

Given that both Open Access TOCs on the ECML are owned by two fairly large companies, I cannot see them likely to disappear without any form of fight. Meanwhile, with First Group part paying and arranging the finance for the electrification of the line from Selby to Hull in return for at least a 10 year or longer guarantee, so I can't see First being too happy with any form of Virgin trying to stamp their mark over Hull.

Wasn't the 'moderation of competition' installed on the WCML before any open access TOC were even thought of?

I was also under the impression that this was due to the huge new trains orders Virgin made in the late 90s. There was to be no more competition on the WCML or on the Birmingham to Bristol/reading corridors than that already existing. Even Central where blocked from operating a service to Oxford.

 

[yorksrob]

Are you meaning that if East Coast Franchise had gone to First that they and First Hull Trains could,t run on the same franchise route?

Don,t forget that First Hull Trains is only 80% First and 20% Renaissance Trains.

Low and behold the same type of operation as Virgin Trains East Coast except 10% different.

Yes, it does all get rather complicated !

 

[CalderRail]

*checks tickets for tomorrow morning, Wakefield to KGX*

Grand Central, £34.50 Advances still available
VTEC, £124.50 Anytimes the only option

Somehow I think GC will be just fine.

GC make money for a lot of reasons, the late availability of Advance Tickets is one of the big ones. That's why you can't really compare Anytime vs Anytime or Advance vs Advance.

GC are cheaper on Advance anyway.

 

[pdeaves]

Given that both Open Access TOCs on the ECML are owned by two fairly large companies, I cannot see them likely to disappear without any form of fight.

Wrexham & Shropshire was also owned by one of these large groups. The large group let it sink, so it's not impossible/unheard of for an open access operator to disappear, whoever it is owned by.

 

[ainsworth74]

Wrexham & Shropshire was also owned by one of these large groups. The large group let it sink, so it's not impossible/unheard of for an open access operator to disappear, whoever it is owned by.

Though there are a number of factors that applied to WSMR which do not, currently, appear to apply to either GC (who shared the same large group as WSMR) or HT.

 

[ChiefPlanner]

Grand Central's continuing survival might have something to do with a rather large slice of of ORCATS revenue from York calls - as well as marketing of affordable fares and good passenger service.

WSMR was hamstrung by the then protection of Moderation of Competetion rules on WCML which prevented them from calling at places such as Wolverhampton (to name but one station) with the lack of ORCATS revenue they might have therefore been entitled to .....

 

[fairysdad]

Nobody huh?

Okay, one of those does say that it's 'Virgin stamping their mark over Hull' (and I'll admit to missing that one first time around); another is talking about Virgin Trains, which is the name given to the company who own the West Coast franchise, and the other does say simply Virgin, but in its context, also refers to the West Coast franchise (although to be pedantic, it's still not 'Virgin' as they're a split company too).

I stand by my point though: the fact that the company who now run the East Coast franchise happens to be 90% Stagecoach and 10% Virgin has no relevance to this thread.

 

[najaB]

I stand by my point though...

If we're standing by points - the OP said:

Given Virgin West Coast's previous history ... could the same thing happen now with Virgin Trains East Coast?

There's a direct comparison being made between VTEC and VTWC so the difference in ownership structure between the two companies is relevant when comparing their business strategy.

 

[DarloRich]

*checks tickets for tomorrow morning, Wakefield to KGX*

Grand Central, £34.50 Advances still available
VTEC, £124.50 Anytimes the only option

Somehow I think GC will be just fine.

GC make money for a lot of reasons, the late availability of Advance Tickets is one of the big ones. That's why you can't really compare Anytime vs Anytime or Advance vs Advance.

GC are cheaper on Advance anyway.

this!

Grand Central's continuing survival might have something to do with a rather large slice of of ORCATS revenue from York calls - as well as marketing of affordable fares and good passenger service.

WSMR was hamstrung by the then protection of Moderation of Competetion rules on WCML which prevented them from calling at places such as Wolverhampton (to name but one station) with the lack of ORCATS revenue they might have therefore been entitled to .....

oh and this + plus the Doncaster ORCATS revenue - god we are so terribly cynical

 

[tbtc]

There’s a reasonable chance that VTEC will hit the Open Access operations harder than previous operators of the ECML franchise have, or make it harder for new applications on “their” line.

GNER seem to have been too tied up with their parent company’s troubles in later years.

NXEC had ambitions of their own to stifle potential Open Access paths (trying to move into the Harrogate market to stop potential bids for such a service).

East Coast seem to have been pretty modest, seemingly no commercial motive (hence the lax approach to bothering to check tickets – I think the new franchise will surprise a few people who’d got away without tickets...), not interesting in getting into fights for “territory”.

The new franchise is going to have additional resources to play with (compared to a fleet that’s been pretty stagnant since privatisation, apart from an odd HST here and there) and therefore have the tools to compete on Wearside (faster service to Sunderland than Grand Central can offer), Teesside (actually serving Middlesbrough) and Bradford (again, faster than GC) and possibly Kirklees (actually serving Huddersfield).

So, that leaves GC as number one in smaller markets like Hartlepool, Brighouse and Halifax, as well as competing for cheap fares at York/ Doncaster etc with a TOC that’ll see a significant increase in seating capacity (when the 800/801s arrive) and therefore more capacity to dump cheap tickets onto the market.

There’s probably a market for some of the GC services, but if they aren’t operated by the main ECML TOC then they may struggle at the bottom of the market - £25 tickets to London sound good to a passenger but you’re going to have to pack a lot of them onto your three hundred seat 180s to have the same revenue as an 800 where most passengers are on standard/open tickets.

If VTEC get a bigger share of the ORCATS market for Sunderland/ Bradford/ Teesside to London and defend their share of the York/Doncaster to London market then GC are going to find things a lot tougher than they did against the “softie” East Coast. Would you be surprised if VTEC question the methodology of the ORCATS allocation at York/ Doncaster to try to secure a bigger slice of the cake for themselves?

Certainly I expect them to put up a robust defence against any further applications/ paths (whether that’s GC running through Leeds, applications for services from London to Yorkshire via Manchester Victoria), whereas EC may have been meeker.

From the noises I’ve heard, the new franchise seems less interested in competing to Hull – possibly because there’s no way of competing with them without clear duplication (other than going via Goole instead of Selby?), or because Hull Trains have got the market sown up pretty well.

(obviously there’s a certain enthusiast hypocrisy about Open Access – firstly the “TOCs shouldn’t be allowed to fight back against Open Access operators, though it was okay for the Open Access operator to set up in the first place” line of argument, secondly the “we shouldn’t have a fragmented railway, things were better when everything was BR, but if operator specific tickets and confusing restrictions mean I can get to London for £25 then I’m all for it” line...)

 

[Suraggu]

There’s a reasonable chance that VTEC will hit the Open Access operations harder than previous operators of the ECML franchise have, or make it harder for new applications on “their” line.

GNER seem to have been too tied up with their parent company’s troubles in later years.

NXEC had ambitions of their own to stifle potential Open Access paths (trying to move into the Harrogate market to stop potential bids for such a service).

East Coast seem to have been pretty modest, seemingly no commercial motive (hence the lax approach to bothering to check tickets – I think the new franchise will surprise a few people who’d got away without tickets...), not interesting in getting into fights for “territory”.

The new franchise is going to have additional resources to play with (compared to a fleet that’s been pretty stagnant since privatisation, apart from an odd HST here and there) and therefore have the tools to compete on Wearside (faster service to Sunderland than Grand Central can offer), Teesside (actually serving Middlesbrough) and Bradford (again, faster than GC) and possibly Kirklees (actually serving Huddersfield).

So, that leaves GC as number one in smaller markets like Hartlepool, Brighouse and Halifax, as well as competing for cheap fares at York/ Doncaster etc with a TOC that’ll see a significant increase in seating capacity (when the 800/801s arrive) and therefore more capacity to dump cheap tickets onto the market.

There’s probably a market for some of the GC services, but if they aren’t operated by the main ECML TOC then they may struggle at the bottom of the market - £25 tickets to London sound good to a passenger but you’re going to have to pack a lot of them onto your three hundred seat 180s to have the same revenue as an 800 where most passengers are on standard/open tickets.

If VTEC get a bigger share of the ORCATS market for Sunderland/ Bradford/ Teesside to London and defend their share of the York/Doncaster to London market then GC are going to find things a lot tougher than they did against the “softie” East Coast. Would you be surprised if VTEC question the methodology of the ORCATS allocation at York/ Doncaster to try to secure a bigger slice of the cake for themselves?

Certainly I expect them to put up a robust defence against any further applications/ paths (whether that’s GC running through Leeds, applications for services from London to Yorkshire via Manchester Victoria), whereas EC may have been meeker.

From the noises I’ve heard, the new franchise seems less interested in competing to Hull – possibly because there’s no way of competing with them without clear duplication (other than going via Goole instead of Selby?), or because Hull Trains have got the market sown up pretty well.

(obviously there’s a certain enthusiast hypocrisy about Open Access – firstly the “TOCs shouldn’t be allowed to fight back against Open Access operators, though it was okay for the Open Access operator to set up in the first place” line of argument, secondly the “we shouldn’t have a fragmented railway, things were better when everything was BR, but if operator specific tickets and confusing restrictions mean I can get to London for £25 then I’m all for it” line...)

Hull and East Riding market is catered rather well by Hull Trains, it's interesting as people were expecting an increased service to Hull and actually it will continue to be one train each day.

My thinking is the DfT were sweetened by Hull Trains offering to stump up the £90 million odd to assist with electrification and are more than happy to give them extended track access and keep the franchised boys away for the time being.

 

[Deerfold]

East Coast seem to have been pretty modest, seemingly no commercial motive (hence the lax approach to bothering to check tickets – I think the new franchise will surprise a few people who’d got away without tickets...), not interesting in getting into fights for “territory”.

Travelling between Leeds and London regularly I'm not sure I've seen much difference in the approach to checking tickets betwen NXEC and EC.

 

[yorksrob]

There’s probably a market for some of the GC services, but if they aren’t operated by the main ECML TOC then they may struggle at the bottom of the market - £25 tickets to London sound good to a passenger but you’re going to have to pack a lot of them onto your three hundred seat 180s to have the same revenue as an 800 where most passengers are on standard/open tickets....)

Are you sure you're not being a little optimistic with regards to the majority of passengers paying for open tickets ? I jumped on a VTWC service from Leeds as far as Doncaster at around quarter to five one evening last week, and it was aparent that the vast majority in standard were on advanced tickets (I had to walk almost to the buffet car just to find an unreserved window seat) and I'm guessing that a lot of people without reservations would have been travelling shorter distances. Obviously this isn't a scientific study, but from my own experience, it doesn't seem to be untypical either.

(obviously there’s a certain enthusiast hypocrisy about Open Access – firstly the “TOCs shouldn’t be allowed to fight back against Open Access operators, though it was okay for the Open Access operator to set up in the first place” line of argument, secondly the “we shouldn’t have a fragmented railway, things were better when everything was BR, but if operator specific tickets and confusing restrictions mean I can get to London for £25 then I’m all for it” line...)

I don't think it's hypocritical even for a relative sceptic of privatisation to laud the one aspect of it that has undoubtedly led to tangible improvements in services to passengers. Obviously there have been some improvements in other respects, but it is always difficult to seperate these out fropm the increased public investment that has taken place over the same time, whereas there is an argument that were it not for open access, it would be unlikely that places such as Bradford and Hull would have anywhere near as good a service today.

 

[najaB]

I jumped on a VTWC service from Leeds as far as Doncaster at around quarter to five one evening last week, and it was aparent that the vast majority in standard were on advanced tickets (I had to walk almost to the buffet car just to find an unreserved window seat)...

Without seeing the tickets, you can't make any conclusion as to if they were Advance tickets or not. I know that if I planned to travel around 1700, I would make sure I had a reservation, and the majority of my travel is on Off-peak rather than Advance tickets.

 

[westv]

Hull and East Riding market is catered rather well by Hull Trains, it's interesting as people were expecting an increased service to Hull and actually it will continue to be one train each day.

My thinking is the DfT were sweetened by Hull Trains offering to stump up the £90 million odd to assist with electrification and are more than happy to give them extended track access and keep the franchised boys away for the time being.

I'm not sure if I'd class a direct service every 2 hours as being well catered for or not.

 

[Clarence Yard]

I wouldn't get too concerned about ORCATS on major flows on the ECML, there's not much left to go for now. Inter-available revenue pots on that route are fast declining in size so anybody planning any kind of raid is going to be sadly disappointed.

If any OA operator is relying on ECML ORCATS shares for their existing business they will be in big trouble!

 

[IanXC]

I have split out the discussion on First's open access application here

Please keep discussion on this thread to Virgin Train's response to this and other open access operators on their route.

Thanks

 

[hairyhandedfool]

....(although to be pedantic, it's still not 'Virgin' as they're a split company too)....

Erm.....Virgin Trains West Coast is actually West Coast Trains Limited (trading as Virgin Trains). The franchise holder is Virgin Rail Group which is 51% owned by Virgin Group.

.... I jumped on a VTWC service from Leeds as far as Doncaster at around quarter to five one evening last week,...

I don't think you did.

 

[Geezertronic]

I don't think you did.

Penny the Pendo probably got lost

 

[yorksrob]

I don't think you did.

Whoops - my typing finger isn't used to there being an "E" there
--- old post above --- --- new post below ---

Without seeing the tickets, you can't make any conclusion as to if they were Advance tickets or not. I know that if I planned to travel around 1700, I would make sure I had a reservation, and the majority of my travel is on Off-peak rather than Advance tickets.

Possibly true. Alas, I can't say as I'm convinced that any InterCity operator is running around with all of its trains mainly full of flexible passengers.