Virgin Trains East Coast franchise to end 24 June 2018 and is temporarily re-nationalised

[47271]

With all due respect we are not discussing rail connectivity between the highlands and London here, we are discussing why the franchise has failed for the third time (see also my comment on Yorksrobs post agreeing with the fact that the current metrics are not right). If you base your franchise bid on increasing ticket income at large rates on a franchise where capacity at the London end is largely utilised and at at the country end pricing is already severely reduced to stimulate demand you are likely to fail.
The sleeper services run at a huge loss that requires subsidy fact. The London to Inverness and Aberdeen service runs at a huge loss that is subsidised by the core franchise. Im not arguing that the services should be withdrawn. If you want the East Coast franchise to produce the sort of premium that has been promised maybe you should be stripping out these social services to a separate company.

Er, no, you are discussing connectivity with the highlands because you're suggesting that the trains north of Edinburgh (or heaven forbid Newcastle) should be operated by a separate company (Caledonian Daytime anyone?) since those extensions drag down performance of the franchise overall. It's a bit like saying a London commuter franchise should be absolved of its off peak services and have them run by a separate subsidised operator because they only run at a fraction of capacity.

Overbid East Coast franchises fail because they're overbid, not because certain services within them don't operate profitably in their own right.

 

[SaveECRewards]

Er, no, you are discussing connectivity with the highlands because you're suggesting that the trains north of Edinburgh (or heaven forbid Newcastle) should be operated by a separate company (Caledonian Daytime anyone?) since those extensions drag down performance of the franchise overall. It's a bit like saying a London commuter franchise should be absolved of its off peak services and have them run by a separate subsidised operator because they only run at a fraction of capacity.

Overbid East Coast franchises fail because they're overbid, not because certain services within them don't operate profitably in their own right.

Imagine if they removed all the alleged unprofitable bits of the ICEC franchise and only ran to Newcastle and Leeds first of all that'd mean no serious rail competition from London to Edinburgh which would likely see flight prices rise, there'd also be no incentive for ScotRail to improve the offerings between Edinburgh to Aberdeen and Inverness, wasn't the reason ScotRail are using HSTs because they know how most people preferred to take a VTEC service than one of their own?

Having the non core services helps make the train more attractive for those people who it benefits.

 

[Tetchytyke]

The core service is not loss-making. Stagecoach overbid, pure and simple.

The knots some people on here will tie themselves in to avoid criticising Stagecoach...

 

[Agent_Squash]

The core service is not loss-making. Stagecoach overbid, pure and simple.

The knots some people on here will tie themselves in to avoid criticising Stagecoach...

If it was that bad, why didn’t the DfT spot this at the time of bidding?

 

[Tetchytyke]

If it was that bad, why didn’t the DfT spot this at the time of bidding?

Stagecoach promised the cash, DfT have a duty to maximise income, what else would they decide?

Remember both Beardy and the Gay Basher both sue, and sue hard, when they lose.

 

[SilentGrade]

If it was that bad, why didn’t the DfT spot this at the time of bidding?

Don't underestimate the sheer incompetence at the DfT

 

[Agent_Squash]

Don't underestimate the sheer incompetence at the DfT

I’m more than aware about our governments ability to make the most simple task go wrong...

Stagecoach promised the cash, DfT have a duty to maximise income, what else would they decide?

Remember both Beardy and the Gay Basher both sue, and sue hard, when they lose.

If the bid is this outrageous, then surely they’d lose the case?

 

[The Ham]

The core service is not loss-making. Stagecoach overbid, pure and simple.

The knots some people on here will tie themselves in to avoid criticising Stagecoach...

Although the bid was high, I don't think that (given what was expect to happen) that it was totally unreasonable and so the DfT would have been hard pushed to justify ditching it as a bid.

IIRC there was talk of 5% growth a year, given that "background" growth was circa 4% it's not unreasonable to assume that it could be achieved. Especially with new services being proposed and new trains coming online letter this year.

The problems seem to be down to miss judging the impact of ditching the rewards, NR not delivering their bits and then trying to cut costs where passengers notice rather than where they shouldn't (as well as other things).

People like a good quality service at a good value, if the quality and value gets worse then prior will stay to look elsewhere. If the other options start to look better then that's where people will start to go.

Offer people something extra (say a free drink if their train is running 10 minutes late) and people will think you run a great service, even though it's cost you next to nothing to provide. It's the little things that people appreciate, even if their train is 30 minutes late (OK there'll be some who won't be so easily fobbed off, but it should be enough to keep most people happy and willing to come back again).

Look at the big complaints about the time that FGR HST service broke down and was stuck for hours Yes there was lots of fuss about the delay, but there was also a LOT of fuss about the lack of drinks. If they had managed to get more drinks there it would have likely gone a long way to reducing the fall out.

 

[SamYeager]

The Inverness service is always well-loaded.

That's as may be but if the passengers aren't paying enough to cover costs then it's not profitable. Now it's possible that the income does exceed costs but we don't know whether that is the case.

Bottom line: high load factor does not equal profit.

 

[Chrism20]

That's as may be but if the passengers aren't paying enough to cover costs then it's not profitable. Now it's possible that the income does exceed costs but we don't know whether that is the case.

Bottom line: high load factor does not equal profit.

No one other than VTEC and the previous management/operators will know the answer to that but it’s maybe a good time to point out that over the last five or so years we have seen the following

1. It be suggested by politicians that the cross border services terminated at Edinburgh with passengers connecting onto ScotRail services to go north

And

2. Crosscountry propose to do a mini recast to their timetable - a move which did not propose removing the Aberdeen service and if anything most would agree that the timings were probably better suited than the current ones.

Neither operator jumped at the idea to curtail at Edinburgh and crosscountry actively sought to retain Aberdeen.

Both had golden opportunities to get rid of these so called basket cases and declined the opportunity to do so which leads me to personally believe these services are no basket cases.

 

[ChiefPlanner]

No one other than VTEC and the previous management/operators will know the answer to that but it’s maybe a good time to point out that over the last five or so years we have seen the following

1. It be suggested by politicians that the cross border services terminated at Edinburgh with passengers connecting onto ScotRail services to go north

And

2. Crosscountry propose to do a mini recast to their timetable - a move which did not propose removing the Aberdeen service and if anything most would agree that the timings were probably better suited than the current ones.

Neither operator jumped at the idea to curtail at Edinburgh and crosscountry actively sought to retain Aberdeen.

Both had golden opportunities to get rid of these so called basket cases and declined the opportunity to do so which leads me to personally believe these services are no basket cases.

Both operators service are clearly important as part of greater connectivity from Scotland to south of the Border , as well as assisting in key internal Scottish markets. I suspect the idea of truncating them was a bit of internal Scottish day-dreaming...akin to similar ideas in the land of my Fathers.

 

[Chrism20]

Both operators service are clearly important as part of greater connectivity from Scotland to south of the Border , as well as assisting in key internal Scottish markets. I suspect the idea of truncating them was a bit of internal Scottish day-dreaming...akin to similar ideas in the land of my Fathers.

Daydreaming or not you can bet your life both would have jumped on the idea if the services were haemorrhaging money in the manner some people would like us to believe.

 

[ChiefPlanner]

Daydreaming or not you can bet your life both would have jumped on the idea if the services were haemorrhaging money in the manner some people would like us to believe.

I was party - in a distant life - to sensibly re-work some of the clashes north of Edinburgh in the evening period , to make better sense of the XC and EC services towards Aberdeen , it made a lot of operational and commercial sense....(and it assisted Scotrail) .... no question about it , they are fairly high cost , but also high value.

 

[SaveECRewards]

I discovered VTEC are running a 50% off sale right now!

The catch... it is only available to those who received the email if they log into the online account the email was sent to (there's no promo code or special link like there normally is).

The person who told me about it stopped booking his VTEC travel direct when Rewards was scrapped so VTEC don't know if he's still a customer.

I checked my usual VTEC account, nothing. I then checked an email address I hardly use. There was an account I created with VTEC for testing purposes but have never bought a ticket using it. The sale offer email was there.

So it looks again like VTEC are not rewarding their regulars and instead going for the occasional traveller. They take their regulars for granted.

 

[Domh245]

So it looks again like VTEC are not rewarding their regulars and instead going for the occasional traveller. They take their regulars for granted.

Looking at it from their point of view (and not trying to justify it) - regulars are regular*, but the occasional travellers are where there are opportunities for growth, which is what their franchise (and presumably any other future ones, including OoLR) is based on

*until they walk away

 

[SaveECRewards]

Looking at it from their point of view (and not trying to justify it) - regulars are regular*, but the occasional travellers are where there are opportunities for growth, which is what their franchise (and presumably any other future ones, including OoLR) is based on

*until they walk away

I understand the need to attract new customers but they certainly have a great way to annoy the regulars which is a bad idea when it's easy to find out what other people are getting through social media. Remember that all previous operators (including National Express) offered some kind of reward to regular travellers. 2016 was probably the year I spent the most on the ECML for various reasons, I didn't receive a single freebie off VTEC although I heard of people on Twitter getting things like free lounge passes or cheap upgrade offers (although most of my travel was in first class, I'd have appreciated these for the times I was travelling standard). Then in 2017 my travel dropped significantly and also quite a bit of travel I did do I booked on other sites - so towards the end of 2017 a lounge pass was sent my way.

I certainly seems to pay to be disloyal to VTEC.

 

[yorksrob]

If it's any consolation, I've received an email for the offer, but although I will need to travel the EC in June, the booking window is just too early as my plans won't have crystallised by then.

Some sort of a credit towards any journey when needed would be much more use.

 

[LNW-GW Joint]

Daydreaming or not you can bet your life both would have jumped on the idea if the services were haemorrhaging money in the manner some people would like us to believe.

The beyond-Edinburgh services were specified in the ITT so will be costed into the franchise bid and premium profile.
It only matters to VTEC if they are performing below expectation, not whether they are "profitable" per se.
The same applies to services like Sunderland and Harrogate.
The decision about whether to serve Inverness and Aberdeen with through EC trains, and the cost/premium impact, is down to DfT and SG, not VTEC.
Same applies to XC.

 

[Chrism20]

The beyond-Edinburgh services were specified in the ITT so will be costed into the franchise bid and premium profile.
It only matters to VTEC if they are performing below expectation, not whether they are "profitable" per se.
The same applies to services like Sunderland and Harrogate.
The decision about whether to serve Inverness and Aberdeen with through EC trains, and the cost/premium impact, is down to DfT and SG, not VTEC.
Same applies to XC.

Bearing in mind that you are writing in a thread about a franchise that was going to be torn up years early on the say so of the Transport Secretary. Removing a route would be a mere formality in comparison particularly if another operator was running a service in that slot.

If the SG were keen and VTEC or XC went to the DFT/SOS and said we are haemorrhaging money on these services and they want them, it would help us increase premiums or reduce subsidies by running another service through our core it would be signed off in a heartbeat.

 

[LNW-GW Joint]

Bearing in mind that you are writing in a thread about a franchise that was going to be torn up years early on the say so of the Transport Secretary. Removing a route would be a mere formality in comparison particularly if another operator was running a service in that slot.

If the SG were keen and VTEC or XC went to the DFT/SOS and said we are haemorrhaging money on these services and they want them, it would help us increase premiums or reduce subsidies by running another service through our core it would be signed off in a heartbeat.

I don't believe it would, because it is too political.
The consultation issue in 2014 was beyond-Edinburgh versus increased services south of Edinburgh.
Eventually they went for both, once the SG had agreed to retaining DfT services in their patch, and DfT had procured the necessary IEPs.
I'd expect to see some shrinkage further south before touching the beyond-Edinburgh services, if it comes to downsizing the franchise.
The debate on XC services is yet to be had, in advance of its rebid next year.
One of the issues there is the unproductive ECS working needed for them, when there is severe overcrowding further south.

 

[Skimble19]

If it's any consolation, I've received an email for the offer, but although I will need to travel the EC in June, the booking window is just too early as my plans won't have crystallised by then.

Some sort of a credit towards any journey when needed would be much more use.

Also received the offer today and noticed something interesting. After clicking the link it takes you to the login page, but the Sign Up to a new account is at the top. There is now a checkbox with the below text in it for you to agree or disagree to:

"If you would like to continue to access and use your customer account should we no longer operate the East Coast train services, tick here so we can pass your details on to the company that takes over from us. If you have already consented, you will also continue to receive marketing information from them."

Is this due to what's happening or are they simply complying with data protection laws? Not noticed anything like this before on TOC sites, although I haven't signed up to any particularly recently.

 

[gsnedders]

The VTEC website has had that as long as they've had the franchise. It'll be needed if the franchise transfers company (versus ownership of the company being transferred, as happened with East Coast to VTEC), given otherwise they couldn't legally transfer PII.

 

[yorksrob]

Also received the offer today and noticed something interesting. After clicking the link it takes you to the login page, but the Sign Up to a new account is at the top. There is now a checkbox with the below text in it for you to agree or disagree to:
View attachment 43092


Is this due to what's happening or are they simply complying with data protection laws? Not noticed anything like this before on TOC sites, although I haven't signed up to any particularly recently.

A bit of both. They won't be able to use information on you for marketing purposes unless they have your specific consent to do so, so I would expect any TOC's relying on tacit consent (I.e. the customer hasn't opted out of receiving marketing information) to send a similar message at some stage.

 

[ainsworth74]

Is this due to what's happening or are they simply complying with data protection laws? Not noticed anything like this before on TOC sites, although I haven't signed up to any particularly recently.

No it's not new. I've seen on a couple of TOC websites. I've also had an email (I think it was TPE) asking if it was okay for my details to be passed over when that franchise changed.

 

[IanXC]

Reaction to the General Data Protection Regulation.

 

[Bletchleyite]

Reaction to the General Data Protection Regulation.

Present DP regulations require it as well - a data controller cannot transfer data to another data controller without explicit permission even under present legislation. That's one reason why most TOC accounts die on refranchising.

East Coast as-was was different, because it was franchised by selling the East Coast Mainline Company Ltd to Virgin/Stagecoach, which meant the data never actually was transferred per-se, the company was sold complete with all staff (so no need for TUPE) and data.

 

[Pete_uk]

Will the 800's retain their Azuma name I wonder?

 

[whhistle]

Personally, if I was VTEC I would be very worried about the First Open Access operation.

It'd be interesting to see how much of an impact Grand Central had when they started operations.

I understand the need to attract new customers but they certainly have a great way to annoy the regulars which is a bad idea when it's easy to find out what other people are getting through social media.

Rewards systems for regular users are far and few between.
The fact of the matter is, East Coast has had it good for a long time. Now things are changing, of course there's sadness, but it's like these regular travellers thing they're owed something...
I'm certainly not rewarded for staying with my car insurer, internet, gas, electric... there's ALWAYS better deals with another company.

Is this due to what's happening or are they simply complying with data protection laws?

There's a big push about data protection in the rail industry at the moment.
Other companies are bringing in external companies to review procedures in place and and make recommendations.


Has there been any further news on when VTEC will cease to be the operator?

 

[47802]

With electrification to Stirling and 5 car IET's available I would have thought there is some scope to reduce the cost of operating to Inverness and Aberdeen.

 

[Bletchleyite]

There's a big push about data protection in the rail industry at the moment.
Other companies are bringing in external companies to review procedures in place and and make recommendations.

There is everywhere. As I understand it GDPR actually changes relatively little, though it adds a few rights and paper-trail requirements. What it does seem to have done, though, is highlighted a vast swathe of non-compliance with the existing Act throughout most areas of business.