DfT, ROSCOs and Rolling Stock

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Oswyntail

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I understand about the DfT having control over ordering rolling stock for provision of new - or effectively new - services; these alter the service levels of the franchise in a material way. I even understand why the DfT might have a strong view about stock replacement programmes, as these will significantly affect the financial outlay of the TOCs on access charges. However, I do wonder whether or why the DfT might get its underwear twisted about stock orders for strengthening existing services (actually, I know they do). Is this all written into the franchise agreements? Or is there really anything preventing increasing stock other than an unwillingness to do so?
 
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Wath Yard

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Additional stock, whether to strengthen or increase services, costs money. No franchise length will ever be equivalent to the lifetime of new stock, therefore even in the fairly unlikely event that the current franchise holder orders new stock without asking for amendments to their franchise terms (assuming the stock wasn't specified in the franchise terms in the first place), it could still reduce the premiums/increase the subsidy required for the franchise when it is relet. More than likely though, they will require extra money from the DfT to strengthen their fleet.

Like it or not the DfT has to have a say in decisions that increase the cost of the railway; TOCs simply don't care what happens after the end of their franchise and if they intend to rebid the will bid lower if they have increased costs.
 

WatcherZero

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Theres nothing to stop franchises putting on their own extra stock at their own expense and some are forced to too meet crowding targets. However the Dft has to approve any extra stock on a loss making service that would require increased subsidy. As they have a budget to keep too they are usually loathe to take on extra spending commitments unless they absoloutly have to.
 

Oswyntail

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... No franchise length will ever be equivalent to the lifetime of new stock....
Surely this is (or should be) a red herring. A suitable "go anywhere" stock design built for the (non time limited) ROSCOs would be easy to hire out for strengthening

Theres nothing to stop franchises putting on their own extra stock at their own expense and some are forced to too meet crowding targets. However the Dft has to approve any extra stock on a loss making service that would require increased subsidy. As they have a budget to keep too they are usually loathe to take on extra spending commitments unless they absoloutly have to.
But if strengthening were to change a loss making service into a profitable one? Or the fares raised by the strengthening made the exercise subsidy balanced?
It strikes me that both sides of the coin are using this sort of excuse for lack of entrepreneurial nous.
 

WatcherZero

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While a TOC may think that would occur they are usually loathe to take the risk and ask the Dft to underwrite the extra stock. A similar process existed for PTE strengthening where a new or strengthened service had to be funded for three years locally and prove it was a net subsidy reduction at the end to be taken on by the Dft as a franchise requirement. However the new Government god rid of this mechanism for funding strengthening/new services as part of cuts, again because they didnt want to take on extra spending risk.
 

starrymarkb

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I believe the SRA was not happy when First bought their 5 HST sets outright and it was made clear that other TOCs were not to pull the same stunt
 

tbtc

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Additional stock, whether to strengthen or increase services, costs money. No franchise length will ever be equivalent to the lifetime of new stock

I'd be interested to know whether the cost of buying a 172 outright today (and only using it for the ten/fifteen years of your franchise, assuming no re-sale value at the end of the franchise*) would be comparable to the cost of renting a 172 from a ROSCO for ten/fifteen years.

The cost of renting a unit in the long term is obviously more than the cost of buying outright, but I wonder whether anybody knows the tipping point where a franchise would be long enough to actually warrant purchasing stock outright.

(* - for arguments sakes)
 

LE Greys

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Is there any particular reason why the DfT can't write it into the agreement that, if a franchisee purchases any new stock, they will buy it off them at the end of the franchise for market price (presumably to offload to a ROSCO)? Assuming the franchise changes hands, anyway.
 

WatcherZero

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They could but that would be like writing a huge blank cheque. The TOC's arent supposed to own rolling stock anyway their supposed to be offered it by ROSCO's though we all know how dysfunctional that is. Though there have been several deals where the Toc agreed to purchase rolling stock and then went to the Roscos to find a partner to own them.
 

Zoe

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I believe the SRA was not happy when First bought their 5 HST sets outright and it was made clear that other TOCs were not to pull the same stunt
I don't think the HSTs are owned by the TOC (First Greater Western Limited) though, just by First.
 

Tiny Tim

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The unpredictability of business during the term of even a short franchise makes it very difficult for anyone to be sure of the rolling stock needs over that time. The present upsurge in both passengers and freight certainly wasn't forseen, especially considering the present economic situation. DfT and ROSCOs aren't the best means of satisfying the requirements of franchisees, their priorities are rather different.

As to FGW (or First Group) owning their own HSTs, I guess there simply wasn't anything to stop them doing it, the civil servants who drafted the franchise probably didn't anticipate a TOC wanting to own it's own trains. It's awkward for the DfT as First aren't obliged to sell the HSTs to another franchisee.

It would be hilarious if First lost the FGW franchise and (in a fit of pique) held onto their five trains, or sold them abroad.
 

LE Greys

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The unpredictability of business during the term of even a short franchise makes it very difficult for anyone to be sure of the rolling stock needs over that time. The present upsurge in both passengers and freight certainly wasn't forseen, especially considering the present economic situation. DfT and ROSCOs aren't the best means of satisfying the requirements of franchisees, their priorities are rather different.

As to FGW (or First Group) owning their own HSTs, I guess there simply wasn't anything to stop them doing it, the civil servants who drafted the franchise probably didn't anticipate a TOC wanting to own it's own trains. It's awkward for the DfT as First aren't obliged to sell the HSTs to another franchisee.

It would be hilarious if First lost the FGW franchise and (in a fit of pique) held onto their five trains, or sold them abroad.

I hope they do! I'm sure they would be very welcome in Inverness and it might just kick the DfT into realising just how dysfunctional the system is and doing something sensible about it.

<EDIT> Or Hull Trains, on thinking about it
 
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DownSouth

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It would be hilarious if First lost the FGW franchise and (in a fit of pique) held onto their five trains, or sold them abroad.
Wouldn't be a chance of happening. The only other places with loading gauges that would necessitate such cramped trains would be Australia and New Zealand, both of which have a enough passenger stock that is actually suitable for the conditions. Pretty well everywhere else has larger loading gauges that would make buying such a little train that's already 30 years old silly.
 

DownSouth

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I must admit, I don't really consider Scotland 'abroad'. Is that wrong of me?
Currently, no. In a few years when passport inspectors are boarding at Carlisle it will be wrong.

I believe that the Scottish Government is generally more interested in buying new trains, not hand me downs a third of a century old.


<metallic sound of can being opened and squishy sound of worms being released>
 

Tiny Tim

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I wish the Scots luck with their bid for independence. And I hope their re-nationalised railway (Scottish Rail?) will be able to buy something better than FGW's cast-off HSTs. But it's about all an independent Scotland will be able to afford.
 
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