FirstGroup Monopoly on northern part of West Coast Mainline: could this have an impact?

Discussion in 'UK Railway Discussion' started by 185, 14 Aug 2019.

  1. 185

    185 Established Member

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    One issue of concern is regarding FGs monopoly on services from NW England to Scotland.

    The new franchise creates one (ordinary) WCML operator north of Lancaster - FG Plc.

    Some suggestions have been mooted to alleviate this monopoly. This could range from removal of TPE's Scottish services to pass to another franchise, or a new standalone operator, or some form of retreat on fares (less likely given a previous CMA order I hear, was accepted then totally breached by another TOC owner.)

    The Competition & Markets Authority are aware and I will keep the forum posted if they mention anything.
     
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  3. PR1Berske

    PR1Berske Established Member

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    Interesting. This is very Speculative Thread of me, I know, but maybe ScotRail could be involved to break/balance the monopoly north of Lancaster.
     
  4. yorkie

    yorkie Administrator Staff Member Administrator

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    We've had this before, back in the days of Virgin Trains using their brand for both the CrossCountry and West Coast franchises, back when XC used to operate services between Birmingham/Manchester and Glasgow/Edinburgh.

    This arrangement lasted about 11 years, I believe?
     
  5. 185

    185 Established Member

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    Could be up to five choices -
    A standalone operator of Manchester-Scottish services.
    Scotrail run it.
    Northern run it.
    XC extend over it.
    LNR extend over it.

    But allowing one firm to set the WCML fares between NW England and Scotland isn't really fair. The ECML / NE England has three operators.
     
  6. 185

    185 Established Member

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    It did, and fares crept up over time. I recall at the time of the TPE Scottish services being brought in, there was a mention of not just improved reliability by effectively splitting the service at Manchester, but introduction of fair competition north of Lancaster (which would have happened anyway if 'Arriva' XC retained it).
     
  7. yorkie

    yorkie Administrator Staff Member Administrator

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    Yes I certainly agree it's not good news for passengers; it will almost certainly result in increased fares, though they will still be competing with LNER for some journeys, which will keep a lid on things to some extent.
     
  8. DarloRich

    DarloRich Veteran Member

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    it wasn't a problem when Virgin/ Stagecoach ran all three north south intercity franchises so why would this be a problem?
     
  9. Aictos

    Aictos On Moderation

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    Exactly, there isn’t a issue at all as apart from First doesn’t have 100% ownership of the West Coast Partnership, the fact remains that TransPennine Express and WCP will be operated as separate TOCs.

    I think it’s more the case that some people have nothing better to do then spread scaremongering theories!
     
  10. Ianno87

    Ianno87 Established Member

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    If anything, fares might be better matched between capacity and demand across all services, rather than (say) TPE price-crashing their trains, making them overly busy instead.
     
  11. nickw1

    nickw1 Member

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    Dare I say it, reducing the number of TOCs on one line would make for a better integrated service, with even intervals and good connections more likely, rather than multiple TOCs all trying to compete with each other?

    On the same line, with constrained paths, I can't see how competition can really work anyhow - though it has a place on entirely separate lines: WCML vs Chiltern for London to Birmingham, for instance.

    Increased fares are a concern but can't the government just regulate them a bit more?
     
  12. LNW-GW Joint

    LNW-GW Joint Veteran Member

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    Different contracts, different TOC ownership (Trenitalia), different franchise timescales.
    The CMA is not interested in rail-on-rail competition issues, as the DfT controls the contracts.
    They have only intervened in overlapping bus and rail services, and there can't be many of those between Preston and Scotland.
    Government fares regulation also prevents significant competition issues.
    (Will First offer 55+ fares on the West Coast? Probably not.)

    First will also soon be operating London-Edinburgh on the ECML, and offering Newcastle-Edinburgh on two of its services - franchised TPE and the new OA service.
    I'm not aware of any competiton concerns there.
     
  13. pdeaves

    pdeaves Established Member

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    The railway is an industry that works because of cooperation over competition.
     
  14. mde

    mde Member

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    They (CMA) currently have an open case regarding Abellio East Midlands given the overlap with other companies where Abellio have a controlling stake (e,g. GA, which isn’t wholly owned by Abellio); what’s to stop them taking an interest here?

    Of course, the test is whether or not there could be demonstrable “substantial lessening of competition”; but, given their interest was piqued in the above, there will surely be some attention here owing to First owning the lions share of the WCP*.

    Whether it actually causes plans on the ground to change, is, of course, a different matter altogether… it could simply be a statement confirming they see no issues and have closed the file :lol:

    * 70:30 in favour of FirstGroup
     
  15. higthomas

    higthomas Member

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    I've never understood why people think anyone cares about a particular rail company having a monopoly of services on a line.
    90% of rail lines in the country have a monopoly consisting of the single operator that serves that line. There are only a few examples of any rail on rail competition.

    That's how the franchise system is designed.
     
  16. Roast Veg

    Roast Veg Member

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    The CMA rightly investigates instances where a bus operator is no longer in competition with a rail route owing ot a franchise changeover, to keep the area competitive. On rail competition does not occur (and is discouraged under ORCATS) - competition instead takes place at the bidding stage.
     
  17. swanhill41

    swanhill41 Member

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    All this talk about monopoly....Frankly this franchise will get mired in a load of legal challenges...From Branson/Souter,feel shareholders are in a rebellious mood and also the fact that there was a very strong hint to get out of rail in the UK....I think we will an extension into next year whilst the legal boys earn some money!!!!
     
  18. Starmill

    Starmill Events Co-ordinator

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    This is the theory.

    The practice between Scottish stations and Preston and all intermediate points on the mainline is currently quite the opposite.
     
    Last edited: 14 Aug 2019
  19. LNW-GW Joint

    LNW-GW Joint Veteran Member

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    Branson has said Virgin will cooperate fully in the transfer of the business to First/Trenitalia on Dec 2.
    So he is clearly not anticipating a reversal of the franchise award.
     
  20. LNW-GW Joint

    LNW-GW Joint Veteran Member

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    Nobody complained when Virgin ran both West Coast and Cross Country services on the same route.
     
  21. yorkie

    yorkie Administrator Staff Member Administrator

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    In theory!

    But it's very different in practice. Derby to Sheffield is priced very differently to Derby to Birmingham to give just one example.

    Yes it will no doubt be the DfT's view that there is nothing to see here. They may be right. But it is still bad news for passengers, it probably will lead to fare rises, and may be of interest to the CMA, regardless of what some people intended when the franchising system was devised.
    Maybe! But since then, regulated fares have skyrocketed (and continue to do so), and the focus now is very much on 'dedicated' fares, particularly Advance fares.

    It remains to be seen whether First Group will have the same appetite for competing against itself on this route. If it does not, then passengers will see huge fare increases (which would not have taken place had we still had the low fares when Virgin originally took over at privatisation; things were very different in terms of fares back then!)
     
  22. swanhill41

    swanhill41 Member

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    We will see.?
     
  23. PR1Berske

    PR1Berske Established Member

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    What we know is Stagecoach is set to have a legal review of their case, Branson/Virgin seem very clear that they will transfer over to FG/TI without any objections.
     
  24. DarloRich

    DarloRich Veteran Member

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    it is possible to do both!
     
  25. pdeaves

    pdeaves Established Member

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    Indeed, it won't endear Branson/Virgin to anybody if they said they would be as awkward as possible.
     
  26. Wilts Wanderer

    Wilts Wanderer Established Member

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    But does he care? Virgin are effectively cutting their losses in the UK rail market so he's not really got anything to lose.
     
  27. R G NOW.

    R G NOW. Member

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    Might end up not happening at all if we get an election and the new government renationalises.
     
  28. Starmill

    Starmill Events Co-ordinator

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    Even with an October General Election (a big stretch!) it seems unlikely that an incoming Government would have time to stop the contract now.
     
  29. R G NOW.

    R G NOW. Member

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    so I assume would have to run until it ends then.
     
  30. AM9

    AM9 Established Member

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    Nor on the BML where Govia runs all services in a pseudo competition setup.
     
  31. Djgr

    Djgr Member

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    Does the railway industry "work"?
     

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