Call for evidence - Arriva's Cross Country record

JoeFF · 24 Aug 2012

Hi there everyone, I'm new to this forum so go easy on me

We've all heard Richard Branson's claims about Virgin's past. But i'm interested in one in particular:

"This is the fourth time that we have been out-bid in a rail tender. On the past three occasions, the winning operator has come nowhere close to delivering their promised plans and revenue, and has let the public and country down dramatically."

I've been doing some research on this to find these past three occasions in which Virgin has failed. Here's what I've got: [do point out if I've missed anything]

1) East Coast main line 2005: Great North Eastern Railway (won) vs Virgin, First Group, DSB
2) East Coast main line 2007: National Express (won) vs Virgin, First Group, Arriva
3) Cross Country rail 2007: Arriva (won) vs Virgin, First Group, National Express

Now obviously GNER and National Express made a mess of things and relinquished their franchise. However Arriva haven't, and there's no obvious evidence for the operator having "come nowhere close to delivering their promised plans and revenue, and has let the public and country down dramatically".

Hence, why I'm here. Does anybody have or know of any evidence (reliably sourced) to suggest that Arriva have broken promises or let people down? Any help would be awesome, thanks!

[p.s. I'm a researcher by profession, but not transport-specific. I do however know a reliable source from a bad one, so anecdotes about bad service etc. won't cut it for this I'm afraid

]

RailUK Forums

bluenoxid · 24 Aug 2012

Hmmmm. WiFi on XC

willc789 · 24 Aug 2012

I wouldnt call it concrete evidence but whenever I travel with them (B'ham-Taunton) I find the staff helpful and largely on time. Admitidly the voyagers are cramped and lack the capacity needed but that doesnt fall at Arriva's feet. Overall I think that they do provide a decent service given the minefield that they operate in and are merely let down by the stock and lack of it!

broadgage · 24 Aug 2012

There must have been lots of individual cases of people let down and promises broken, but I am not aware of any generalised failure by Arriva, as distinct from individual breakdowns, faults, failures, or the odd employee whom has given poor service.

Cross country is IMHO better run now than it was when under Virgin control, though that is not saying much !

Simon11 · 24 Aug 2012

I doubt there will be much information on what xc current revenue is although you may be able to find info on how much they bid for.

Xc are nearly finished with the wifi programme, what was the consquence for being late on this project?

YorkshireBear · 24 Aug 2012

Wifi has been there only let down. Not exaclty major though, they havent failed and gone bankrupt and ti is currently being installed.

Worth noting with GNER went bust mainly because there parent company went bust, (sea containers) and they did not go bust because of the franchise at all it was completely seperate.

LNW-GW Joint · 24 Aug 2012

JoeFF said:
Hence, why I'm here. Does anybody have or know of any evidence (reliably sourced) to suggest that Arriva have broken promises or let people down? Any help would be awesome, thanks!

But the XC franchise is in revenue support and is a problem for Arriva and DfT.
Branson's point is that if he had the franchise it would have done better financially (not sure how).

XC was not just lost by Virgin in the 2007 bidding.
They had an exclusive negotiation with DfT (SRA) first, as incumbent, but could not reach agreement so it went to open tender.
The only solace for Virgin was that the Birmingham-Scotland leg of the old XC was remapped on to WC before the bidding started.

Arriva was very late installing wi-fi which was a commitment, but that is hardly critical.
They did put 4 HSTs back into operation, but as usual we do not know what Virgin would have done if they had won.
Maybe they would have gone for some new/extended 22x trains, but DfT baulked at the cost.

Badger · 24 Aug 2012

Wasn't there an issue with the seating - they promised 35% more, people thought it would mean bigger trains, but actually meant moving the seats closer together? (Don't quote me on that, I just remember hearing that). I've only ever had terrible experiences with Cross Country having used them for Uni for three years but that is subjective and doesn't cover the whole franchise.

JoeFF · 24 Aug 2012

YorkshireBear said:
Wifi has been there only let down. Not exaclty major though, they havent failed and gone bankrupt and ti is currently being installed.

Worth noting with GNER went bust mainly because there parent company went bust, (sea containers) and they did not go bust because of the franchise at all it was completely seperate.

Good point about GNER and relevant as we're concerned with why not choosing Virgin might be a bad thing. Virgin's case against First was based on the bid value rather than the stability of the company, so we should really be focusing on failures related to the initial bids that won the respective franchises.

A few comments on WiFi - interesting although, as YorkshireBear says, hardly major and hardly justifying Branson's claim.

Any other offerings?
--- old post above --- --- new post below ---

LNW-GW Joint said:
But the XC franchise is in revenue support and is a problem for Arriva and DfT.
Branson's point is that if he had the franchise it would have done better financially (not sure how).

Not sure how either, but that's decent. Will check that out, thanks!

317666 · 24 Aug 2012

Badger said:
Wasn't there an issue with the seating - they promised 35% more, people thought it would mean bigger trains, but actually meant moving the seats closer together?

Yes, they did that with the Class 170s (although they were previously operated by Central Trains, not Virgin). The legroom on them now is appalling and they're still overcrowded, it doesn't seem to have done much good!

LNW-GW Joint · 24 Aug 2012

Here is an interesting chunk from the DB Group annual report (June), which took a lot of finding:

http://www1.deutschebahn.com/ecm2-db-en/ar_2011/gmp/units/passenger_transport/dbarriva.html

There were a number of different developments in the UK Trains line of business. In total, the year under review was satisfactory for our franchise in Wales, while the development of our CrossCountry franchise and of Chiltern Railways was weak. The expected improvements in earnings could not be achieved due, in particular, to a decline in the number of passengers. We reacted to this with additional cost-cutting measures and improved offers.

Code for trouble at XC and CH.

swt_passenger · 24 Aug 2012

Badger said:
Wasn't there an issue with the seating - they promised 35% more, people thought it would mean bigger trains, but actually meant moving the seats closer together? (Don't quote me on that, I just remember hearing that). I've only ever had terrible experiences with Cross Country having used them for Uni for three years but that is subjective and doesn't cover the whole franchise.

The problem was that the '35% more seats' only referred to specific parts of their network at certain times of the day. It was never actually a 'promise' to provide a 35% increase in terms of the train fleet's overall capacity, or all day/all week/all routes.

There is a section in the ITT that attempts to explain exactly what was meant, but it isn't an easy read, but there was an addendum published later:

http://webarchive.nationalarchives....invitationtotender/clarificationonadditi1.pdf

Now that still has loads of tables, but it does include a range of percentages - but '35%' itself doesn't actually appear.

AFAICT they did provide the additional capacity required - but that might simply be by running certain trains doubled up, or 221s vice 220s, and obviously the HSTs come into it somehow.

Whatever, the '35% increase' became a bit of a mythological figure - and no one really knows how it all works, probably only Arriva and DfT...

Simon11 · 24 Aug 2012

LNW-GW Joint said:
Here is an interesting chunk from the DB Group annual report (June), which took a lot of finding:

http://www1.deutschebahn.com/ecm2-db-en/ar_2011/gmp/units/passenger_transport/dbarriva.html

There were a number of different developments in the UK Trains line of business. In total, the year under review was satisfactory for our franchise in Wales, while the development of our CrossCountry franchise and of Chiltern Railways was weak. The expected improvements in earnings could not be achieved due, in particular, to a decline in the number of passengers. We reacted to this with additional cost-cutting measures and improved offers.

Code for trouble at XC and CH.

Hmm this is 2012 june? Surely with evergreen, you would at least expect journeys to increase!

tbtc · 24 Aug 2012

swt_passenger said:
The problem was that the '35% more seats' only referred to specific parts of their network at certain times of the day. It was never actually a 'promise' to provide a 35% increase in terms of the train fleet's overall capacity, or all day/all week/all routes.

There is a section in the ITT that attempts to explain exactly what was meant, but it isn't an easy read, but there was an addendum published later:

http://webarchive.nationalarchives....invitationtotender/clarificationonadditi1.pdf

Now that still has loads of tables, but it does include a range of percentages - but '35%' itself doesn't actually appear.

AFAICT they did provide the additional capacity required - but that might simply be by running certain trains doubled up, or 221s vice 220s, and obviously the HSTs come into it somehow.

Whatever, the '35% increase' became a bit of a mythological figure - and no one really knows how it all works, probably only Arriva and DfT...

My memory of 35% was that it related to "peak time capacity through New Street" (which the HSTs helped improve). Could well be wrong though - it's a bit like the 35% on the WCML (doe it relate to number of seats occupied, growth, number of extra seats crammed into a Pendolino coach...)

JoeFF said:
We've all heard Richard Branson's claims about Virgin's past. But i'm interested in one in particular:

"This is the fourth time that we have been out-bid in a rail tender. On the past three occasions, the winning operator has come nowhere close to delivering their promised plans and revenue, and has let the public and country down dramatically."

That's a strange accusation to level at XC - they've stuck with the franchise (despite tough economic times, they've not "handed the keys back" - to use that increasingly common phrase), the WiFi is a pretty trivial issue in the grand scheme of things.

LNW-GW Joint said:
But the XC franchise is in revenue support and is a problem for Arriva and DfT

They're certainly not the only TOC to be in revenue support. Maybe Mr Branson could tell us all about Virgin's impressive record in never being bailed out by the taxpayer?

Badger · 24 Aug 2012

Isn't the whole point of the rail franchises that profitable routes subsidise others (i.e. revenue support) or do I misunderstand the terms?

Wath Yard · 24 Aug 2012

JoeFF said:
Good point about GNER and relevant as we're concerned with why not choosing Virgin might be a bad thing. Virgin's case against First was based on the bid value rather than the stability of the company, so we should really be focusing on failures related to the initial bids that won the respective franchises.

A few comments on WiFi - interesting although, as YorkshireBear says, hardly major and hardly justifying Branson's claim.

Any other offerings?

As has been stated there is evidence that XC has not been a cash cow, but no suggestion Arriva have any intention of walking away. Things like PPM and passenger satisfaction levels can be compared from the Virgin era and now, however XC is a totally different franchise to what it was. In the Virgin era it was purely long distance and now it is mixed. Long distance services have higher passenger satisfaction ratings. Which also makes his current incumbent knows best argument irrelevant when discussing XC.

I suspect Branson is aware they cannot be compared and wouldn't take kindly to any forensic examination.

NXEC failed spectacularly, however there are also differences between that and FirstGroup's ICWC bid. Branson's argument is that First's bid will fail due to it being heavily back-loaded. NXEC failed in its 2nd year.

Mvann · 24 Aug 2012

The other difference is that First have bid in the middle of a recession. Nxec believed that a recession would not happen again. Don't know where they got that idea from.

YorkshireRider · 24 Aug 2012

I dont think Virgin gave a rats bottom when they lost the XC franchise, just not enough profit in it. They put a low bid in to give them a decent return, and although there is no suggestion Arriva will walk away they must be wondering if it was really worth it.
Sea containers problems didnt help GNER but the company was still losing money, and had it being a stand alone company would have still gone under. If it had a healthy parent company maybe it could have been proped up to get through the worst period but they did over bid, it just hadnt been stress tested correctly (or maybe not at all).

tbtc · 24 Aug 2012

YorkshireRider said:
Sea containers problems didnt help GNER but the company was still losing money, and had it being a stand alone company would have still gone under. If it had a healthy parent company maybe it could have been proped up to get through the worst period but they did over bid, it just hadnt been stress tested correctly (or maybe not at all).

Grand Central and Hull Trains didn't help matters either.

Lampshade · 24 Aug 2012

XC are shocking, extortionate fares, dragging their feet on wifi, catering scaled back - just what you need when travelling Aberdeen - Penzance.

Zoe · 24 Aug 2012

Lampshade said:
XC are shocking, extortionate fares, dragging their feet on wifi, catering scaled back - just what you need when travelling Aberdeen - Penzance.

I doubt many people do that journey on XC. The average journey length was less than 100 miles when the franchise was let.

LNW-GW Joint · 24 Aug 2012

Badger said:
Isn't the whole point of the rail franchises that profitable routes subsidise others (i.e. revenue support) or do I misunderstand the terms?

If a franchise is in revenue support for more than a brief period, it is bad for everybody - the TOC owner, DfT, passenger, taxpayer.
It means the franchise is falling short of its forecast and either getting more subsidy or delivering less premium.

The DfT will have an overall profile of total subsidy/premium and up to a point it's OK for higher premiums in one TOC to fund higher subsidies elsewhere.
But when (eg) First walk away from a premium payment of £800m, or XC undershoot for several years that is bad news, becasue there's no way of making up the loss.
Sooner or later it finds its way into reduced spend elsewhere (eg less rolling stock approved by the DfT).
XC is in the cleft stick of needing more stock but the business performance is not supporting an expansion.
By contrast FTPE is doing better than forecast, needing less subsidy than planned.
The big fares increases are a way of topping up the DfT's coffers against a general underperformance by franchises.
The recession is also bound to be having an effect.

jon0844 · 24 Aug 2012

Who would go from start to finish on XC? The train takes about a week to do the journey!

How many people even go from Bedford to Brighton regularly (which is significantly more feasible)?

David10 · 24 Aug 2012

According to their annual accounts, CrossCountry lost £27 million in 2011.

YorkshireRider · 24 Aug 2012

tbtc said:
Grand Central and Hull Trains didn't help matters either.

Very true, although they were aware of Hull Trains during the bidding as they already existed, however Grand Central getting the go ahead was a blow. They threated legal action but didnt have a leg to stand on as there was nothing in the franchise agreement to not allow it. Although i like Grand Central as a company im not a huge fan of open access and i hope these 2 companies are the last we see of it on the WCML and ECML.

O L Leigh · 24 Aug 2012

Poor old Richard Branston. What a sore loser.

I'm sorry to have to say it, but I'm afraid that I don't subscribe to the supposedly widely held view that he was hard done by. His pronouncements are meaningless. To have said that he would have done a better job of running certain franchises if only he'd won them is utterly meaningless, and so is berating the current (or former) operators to whom he lost for their performance. It's just sour grapes. He doesn't have a divine right to run train services on this or any other line. By all accounts he was quite happy to offload the XC franchise.

In any case, a 35% increase in capacity does not necessarily mean that all trains have been reconfigured. Such increases in capacity can be achieved by increasing frequency or strengthening certain services. Yes the shops have gone from the Voyager to be replaced by seats, but this alone would not yield this increase. The Cl170s have not had the seat spacing altered, as there is no less space inside one now than there was when they were cascaded across from MML before the creation of the enlarged XC franchise.

Lets keep this in perspective. Branson seems to mistake the rail franchising system for a popularity contest. It's not.

Besides, he's hardly losing out. Or have we forgotten his 49% interest in Stagecoach's rail operations...?

O L Leigh

LNW-GW Joint · 24 Aug 2012

O L Leigh said:
Besides, he's hardly losing out. Or have we forgotten his 49% interest in Stagecoach's rail operations...?

It's the other way round - Stagecoach has 49% in VT.
Branson will have no stake in railways after the VT exit.

tec · 24 Aug 2012

Unless Arriva XC provide longer trains which they have failed to do since taking over from Virgin, the franchise is just as bad if not worse than it was under Virgin.

I caught a XC Voyager train last week that was running 1 hour late via Leamington Spa, so what is the point of running a train that late?

tbtc · 24 Aug 2012

tec said:
Unless Arriva XC provide longer trains which they have failed to do since taking over from Virgin, the franchise is just as bad if not worse than it was under Virgin

Other than the longer HSTs?

David10 · 24 Aug 2012

O L Leigh said:
Or have we forgotten his 49% interest in Stagecoach's rail operations...?

Stagecoach own 49% of Virgin Rail, Branson has no shareholding in Stagecoach.
--- old post above --- --- new post below ---

tec said:
I caught a XC Voyager train last week that was running 1 hour late via Leamington Spa, so what is the point of running a train that late?

Would you prefer it didn't run and two trains worth of passengers squeeze onto one train? And unless it was on its last service for the day, the Voyager would have had further services to operate.

Call for evidence - Arriva's Cross Country record

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