The Post-Deregulation Era (1986-2000)

[Roilshead]

Im surprised PMT wasn't merged with Midland Red, . . . in the NBC era, seemed quite logical to merge them

Based on what logic?

 

[317 forever]

West Midlands Travel bought Westcourt Group in 1994 (I think), which was the firm that owned United, Teesside Motor Services and Tees and District. United had been embroiled in a protracted battle with a former MD who set up a rival operation in Darlington since 1993. They also purchased Lynton Travel Group who owned Citibus in Manchester, and County Bus and Coach (mainly the Essex area of the former London Country North East). IIRC, NatEx bought WMT but didn't want the non core bits so they were sold to First (Citibus) and Cowie Group.


Some did, some didn't. It's a long time but believe MRW staff did well out of the sale to Badgerline. There were a mix of MBOs and ESOPs and it varied from firm to firm as to how well the drivers did or didn't do, or how much the management teams put in.

Alan Stephenson is an interesting point as I think the purchases were both almost a sort of leveraged buyout. It is 32/33 years ago so if I've got anything wrong, I do apologise in advance. I think they were done in conjunction with Parkdale Holdings (a property firm) so there was an immediate divergence of property vs operational assets. The properties were then leased back until such time as they were vacated or sold for redevelopment. Some of those were quite valuable like the depot sites in Harrogate and Hertford. Somewhere in my mind is that a similar arrangement was undertaken between Parkdale and Drawlane but only for the LCSW business (which had a very desirable property portfolio).

West Midlands Travel also bought Westlink in south west London. Then new owners National Express sold Westlink to London United, before LU sold out to Transdev.

 

[317 forever]

When Stagecoach come calling, you don't turn them down, at least you didn't then. I think Busways selling out was the right call and, I presume, TUPE would have protected the existing staff from any dramatic changes, at least for a while.

I was more referring to Darlington, with Tracky being the preferred bidder for Darlington Transport, but as you say Perth with Strathtay was the same.


Do you mean the county or West Yorkshire Road Car? I wouldn't say West Yorkshire Road Car was that unrecognisable, with Coastliner, Keighley and Harrogate still pretty much the same as they always were, although without Leeds, Bradford and York. Across the county not that much has really changed either.

Indeed, when Stagecoach bid for Hartlepool just a couple of months after "flattening" Darlington, it was reported that 100% of Hartlepool owners agreed to sell to Stagecoach.

 

[Statto]

West Midlands Travel also bought Westlink in south west London. Then new owners National Express sold Westlink to London United, before LU sold out to Transdev.

Travel West Midlands[after rebranding from West Midlands Travel, hmmm i wonder how much time was used in the office to come up with that rebranding] then returned to London under Travel London, & brought Tellings Golden Miller, the Surrey routes were rebranded as Travel Surrey, before selling to NedRailways, becoming Abellio London & Abellio Surrey.

 

[delt1c]

I remember back in the early days that there was a Route in West London operated by Scania ( I think) . Cant remember the route number or Trading name but it was to be used as a testbed for Scania Buses.

 

[TheGrandWazoo]

Indeed, when Stagecoach bid for Hartlepool just a couple of months after "flattening" Darlington, it was reported that 100% of Hartlepool owners agreed to sell to Stagecoach.

Whereas months before Darlington, a mere 99% of Busways staff voted to accept Stagecoach's bid. The experience of Lancaster may be more relevant.

Got to remember the position that these firms were in. In Busways, you had a fleet that had received some steady investment in new vehicles but it wasn't really enough. They had quite a lot of S-W reg Atlanteans to replace AND the various minibuses that arrived in the immediate deregulation age. It was one of the reasons why Busways management wanted to sell and you could hardly accuse Eric Hutchinson of being some mercenary.

Hartlepool was in an even more difficult position with a fleet of REs of which the newest were 20 years old, and some Dennis Dominators and some Dennis Falcons that were also difficult to get spares for. Only the Nationals were perhaps more standard.

 

[TheGrandWazoo]

West Midlands Travel also bought Westlink in south west London. Then new owners National Express sold Westlink to London United, before LU sold out to Transdev.

I'd forgotten about Westlink!

To be fair, the West Midlands influence on their acquisitions was limited but then again, they didn't own them for too long before NX bought WMT.

 

[A0wen]

Im surprised PMT wasn't merged with Midland Red, or Midland Red North in the NBC era, seemed quite logical to merge them

It's a tricky one - you could equally make a case that PMT could have been merged with Crosville or North Western.

 

[TheGrandWazoo]

It's a tricky one - you could equally make a case that PMT could have been merged with Crosville or North Western.

Wasn't it that when split, the various Midland Red constituents had their back office functions (e.g. payroll) either performed or supported by other NBC firms so South was done by COMS? Did PMT do the same for MRN?

I guess there is also the argument that most of MRN's operations were in Staffordshire (not wishing to denigrate Salopians) and that having the Staffs ops under one firm might have helped with negotiating with the council? (Note: fair to say that Mid Red East did have a fair number of services that were in Staffs, albeit from across the border from Swad depot).

 

[Tetchytyke]

Whereas months before Darlington, a mere 99% of Busways staff voted to accept Stagecoach's bid. The experience of Lancaster may be more relevant.

There are countless examples of Stagecoach using quite frankly abhorrent business practices to push the incumbent operator out of business. Darlington's the poster boy for it but Lancaster, Preston, Perth, Bognor Regis, Portsmouth, Fife, the list goes on and on.

It goes to show just how pathetic and toothless competition legislation is in the UK, even now. Stagecoach got away with it time and time again. They still do. Eight MMC referrals in four years. Eight! In four years!

As I said, if Stagecoach came knocking you didn't turn them down. A bit like the Mafia, when you think about it.

As an aside, I always genuinely wonder how Brian squares his disgusting business practices with his professed devout Christian faith. I certainly don't remember Jesus teaching "screw over thy neighbour to get his business at a knockdown price", and I've the "benefit" of a full Catholic education. It must take some pretty heavy-duty mental gymnastics.

 

[DunsBus]

There are countless examples of Stagecoach using quite frankly abhorrent business practices to push the incumbent operator out of business. Darlington's the poster boy for it but Lancaster, Preston, Perth, Bognor Regis, Portsmouth, Fife, the list goes on and on.

It goes to show just how pathetic and toothless competition legislation is in the UK, even now. Stagecoach got away with it time and time again. They still do. Eight MMC referrals in four years. Eight! In four years!

As I said, if Stagecoach came knocking you didn't turn them down. A bit like the Mafia, when you think about it.

As an aside, I always genuinely wonder how Brian squares his disgusting business practices with his professed devout Christian faith. I certainly don't remember Jesus teaching "screw over thy neighbour to get his business at a knockdown price", and I've the "benefit" of a full Catholic education. It must take some pretty heavy-duty mental gymnastics.

Strathtay weren't exactly put out of business in Perth. Its Perth depot racked up huge losses dealing with the competition from Stagecoach and despite a truce being called in early 1990, which saw both operators share the city services, the damage had already been done - there was no prospect of the depot recovering financially. Strathtay wisely decided to pull the plug on it and left Perth to Stagecoach.

 

[GusB]

There are countless examples of Stagecoach using quite frankly abhorrent business practices to push the incumbent operator out of business. Darlington's the poster boy for it but Lancaster, Preston, Perth, Bognor Regis, Portsmouth, Fife, the list goes on and on.

Inverness can also be added to that list. There had already been a bit of a bus war between the fledgling Inverness Traction and the incumbent Highland Scottish. IT got into a bit of trouble and was acquired by another fairly new firm - Alexanders North East - which was taking on Northern Scottish at the time. It didn't last very long until Alexanders NE bit the dust and were taken over by Grampian. Stagecoach took over the Inverness operations and it wasn't long before they did their usual "run free buses until the routes are registered", with the inevitable consequences. The details are a bit hazy now, but from memory the industrial relations were a bit iffy at Highland anyway and it wasn't that difficult to tempt drivers away.

 

[TheGrandWazoo]

There are countless examples of Stagecoach using quite frankly abhorrent business practices to push the incumbent operator out of business. Darlington's the poster boy for it but Lancaster, Preston, Perth, Bognor Regis, Portsmouth, Fife, the list goes on and on.

It goes to show just how pathetic and toothless competition legislation is in the UK, even now. Stagecoach got away with it time and time again. They still do. Eight MMC referrals in four years. Eight! In four years!

As I said, if Stagecoach came knocking you didn't turn them down. A bit like the Mafia, when you think about it.

As an aside, I always genuinely wonder how Brian squares his disgusting business practices with his professed devout Christian faith. I certainly don't remember Jesus teaching "screw over thy neighbour to get his business at a knockdown price", and I've the "benefit" of a full Catholic education. It must take some pretty heavy-duty mental gymnastics.

To be fair, they paid a greater price in the end (as I think Souter has conceded) as without that sort of press, they probably wouldn't have been obliged to divest themselves of Mainline and SB Holdings shareholdings (or Preston Bus for that matter).

 

[Tetchytyke]

from memory the industrial relations were a bit iffy at Highland anyway and it wasn't that difficult to tempt drivers away.

It was the same in Darlington, where the drivers were fairly adamant they wanted the Stagecoach offer to win. I think they feared United getting it, consolidating and making people redundant.

I wouldn't be at all surprised if there was a lot of truth in the rumour that Tracky were working as a stalking horse for United.

To be fair, they paid a greater price in the end (as I think Souter has conceded) as without that sort of press, they probably wouldn't have been obliged to divest themselves of Mainline and SB Holdings shareholdings (or Preston Bus for that matter)

I think that's his story and he's sticking to it. I can't see much evidence to suggest Stagecoach came out of wild west deregulation as the losers.

The Mainline holding wasn't significant (20% wasn't it?).

As for Preston Bus, they got it for a knockdown price and they certainly didn't make a loss on selling it to Rotala. Stagecoach didn't really suffer any penalty, the only ones to lose out were the original owners of Preston Bus, who got screwed over by being forced to sell at fire sale prices. It's not like Stagecoach had to give it away or, for that matter, compensate Preston Bus' owners.

Preston Bus was also a decade after the others. All those MMC undertakings in the early 90s didn't change their business practices and didn't stop them trying the same dirty tricks again in Preston. It shows just how toothless they really were.

It wasn't just Stagecoach at it, to be fair, but they were the most aggressive.

As I said above, deregulation caused a lot of local authorities to lose a lot of money (Lancaster, Darlington, etc), and allowed a handful of general managers who were in the right place at the right time to get filthy rich. That may well have been the aim. But it didn't ultimately change anything much, it certainly didn't reduce subsidy or increase competition.

 

[PaulWC]

Wasn't it that when split, the various Midland Red constituents had their back office functions (e.g. payroll) either performed or supported by other NBC firms so South was done by COMS? Did PMT do the same for MRN?

I guess there is also the argument that most of MRN's operations were in Staffordshire (not wishing to denigrate Salopians) and that having the Staffs ops under one firm might have helped with negotiating with the council? (Note: fair to say that Mid Red East did have a fair number of services that were in Staffs, albeit from across the border from Swad depot).

Yeah, from the time it was formed right up to 1986, the registered office for MRN was that of PMT's at Woodhouse Street in Stoke. Early financial problems were blamed on this set up.

I suspect given their expansionist policies of the late 80s, the management in Stoke would've looked very favourably on a "merged" outfit based at Woodhouse Street and calling itself PMT.

 

[TheGrandWazoo]

It was the same in Darlington, where the drivers were fairly adamant they wanted the Stagecoach offer to win. I think they feared United getting it, consolidating and making people redundant.

I wouldn't be at all surprised if there was a lot of truth in the rumour that Tracky were working as a stalking horse for United.



I think that's his story and he's sticking to it. I can't see much evidence to suggest Stagecoach came out of wild west deregulation as the losers.

The Mainline holding wasn't significant (20% wasn't it?).

As for Preston Bus, they got it for a knockdown price and they certainly didn't make a loss on selling it to Rotala. Stagecoach didn't really suffer any penalty, the only ones to lose out were the original owners of Preston Bus, who got screwed over by being forced to sell at fire sale prices. It's not like Stagecoach had to give it away or, for that matter, compensate Preston Bus' owners.

Preston Bus was also a decade after the others. All those MMC undertakings in the early 90s didn't change their business practices and didn't stop them trying the same dirty tricks again in Preston. It shows just how toothless they really were.

It wasn't just Stagecoach at it, to be fair, but they were the most aggressive.

As I said above, deregulation caused a lot of local authorities to lose a lot of money (Lancaster, Darlington, etc), and allowed a handful of general managers who were in the right place at the right time to get filthy rich. That may well have been the aim. But it didn't ultimately change anything much, it certainly didn't reduce subsidy or increase competition.

I think we can stop the stalking horse theory there. I've heard the theory that Your Bus was also a stalking horse by United (as it was set up by a former United MD) and it's just not true. In any case, the deal that Busways and Go Ahead cooked up with TWOC meant that people had got wise to that sort of behaviour! Any sale would have had caveats to protect the staff and any sale by YT would also have had MMC intervention.

The Mainline shareholding may have only been 20% but it was a precursor to getting a full purchase (as they did so with GM Buses South). Remember that despite what we now think of with First South Yorkshire, Mainline was a profitable business and highly desirable and at that time was a better purchase than YT. The SB Holdings was also 20% and that was also a knockback. The other MMC interventions didn't also all go Stagecoach's way such as the purchase of Portsmouth in 1989 that they were obliged to divest. Undeniably, the view of Stagecoach as being a unrelenting and anti-competitive (and they were/are) is correct as we saw with Catch A Bus in South Shields or many other local examples. However, they then seemed to settle down as the market matured and in a remarkably boring way, began to improve things. Granted the vehicles were less desirable - Volvo B10M PS types whilst First were buying B10BLEs - but in their own way, they began to develop and nurture the businesses that they had (though I accept that was more in the provinces than in the urban areas).

That made their move against Preston Bus even more perplexing. They really didn't need to do it and it could have cost them a lot more than it gained them. As for Mr Souter's religious convictions, I think I've made my views on those clear in the past (and I think we tend to share them).

 

[Tetchytyke]

However, they then seemed to settle down as the market matured and in a remarkably boring way, began to improve things

I think the same is across the whole industry. You had that initial wild west phase of deregulation where you had everyone scrabbling against everyone else, fighting through fair means and foul, and then it settled down into a very gradual consolidation phase, companies gradually and steadily merging. Mergers were by-and-large friendly, even if the likes of Badgerline didn't quite twig that their merger was more of a takeover (and likewise when Yorkshire Rider merged into Badgerline, really).

I suppose where Stagecoach were an outlier is they were still acting like the original bus bandits well into the mid-90s, whereas everyone else had pretty much settled down by the very early 90s. As you say, Preston was just perplexing; Preston Bus probably would have sold up if Stagecoach had made a sensible offer, even in the early 2000s, nobody would have been screwed over and the OFT wouldn't have batted an eyelid. After all, the OFT didn't seem particularly fussed when Arriva and Go called a truce and carved everything up in the north east in an agreeably anti-competitive way in the mid 2000s.

 

[TheGrandWazoo]

I think the same is across the whole industry. You had that initial wild west phase of deregulation where you had everyone scrabbling against everyone else, fighting through fair means and foul, and then it settled down into a very gradual consolidation phase, companies gradually and steadily merging. Mergers were by-and-large friendly, even if the likes of Badgerline didn't quite twig that their merger was more of a takeover (and likewise when Yorkshire Rider merged into Badgerline, really).

I suppose where Stagecoach were an outlier is they were still acting like the original bus bandits well into the mid-90s, whereas everyone else had pretty much settled down by the very early 90s. As you say, Preston was just perplexing; Preston Bus probably would have sold up if Stagecoach had made a sensible offer, even in the early 2000s, nobody would have been screwed over and the OFT wouldn't have batted an eyelid. After all, the OFT didn't seem particularly fussed when Arriva and Go called a truce and carved everything up in the north east in an agreeably anti-competitive way in the mid 2000s.

I really couldn't fathom the Preston Bus one. As you say, a generous offer would've been much more sensible.

The Arriva/Go Ahead truce is much misreported, especially as there's a focus on those emails that were found which was really after the event.

The fact is that there had been a nice little division of the respective territories for years and Arriva were remarkably complacent. Peter Huntley knew that there was a lack of ambition in Arriva NE (perhaps the MD Steve Noble wasn't as motivated as he had been....) with some excellent margins being made through a lack of fleet investment and selling off properties. Huntley arrived as Bishop depot was sold to Arriva and had he arrived sooner, that wouldn't have happened. Instead, Huntley fundamentally outmanoeuvred Arriva under both Noble and May so that Go Ahead were simply able to purchase and develop competitive operations and were then able to use those as leverage to get the Tyne Valley. The emails really referred to the end of the war and reinstatement of a new arrangement.

 

[TheSel]

Lancaster has been mentioned before, in connection with Stagecoach, but I don't think anyone has mentioned Heysham Travel, which became part of Merseybus, and gave them a hold in Lancaster - significantly to/from the University - for a while.

 

[Sandy Drew]

There are countless examples of Stagecoach using quite frankly abhorrent business practices to push the incumbent operator out of business. Darlington's the poster boy for it but Lancaster, Preston, Perth, Bognor Regis, Portsmouth, Fife, the list goes on and on.

It goes to show just how pathetic and toothless competition legislation is in the UK, even now. Stagecoach got away with it time and time again. They still do. Eight MMC referrals in four years. Eight! In four years!

As I said, if Stagecoach came knocking you didn't turn them down. A bit like the Mafia, when you think about it.

As an aside, I always genuinely wonder how Brian squares his disgusting business practices with his professed devout Christian faith. I certainly don't remember Jesus teaching "screw over thy neighbour to get his business at a knockdown price", and I've the "benefit" of a full Catholic education. It must take some pretty heavy-duty mental gymnastics.

What abhorrent business practices did Stagecoach deploy in Lancaster?

 

[Tetchytyke]

Instead, Huntley fundamentally outmanoeuvred Arriva under both Noble and May so that Go Ahead were simply able to purchase and develop competitive operations and were then able to use those as leverage to get the Tyne Valley.

Go were smart, they bought the independents and it did give them leverage against Arriva: Jayline and Stanley Taxis in County Durham, and Northumbria Coaches, spring to mind. But agreeing to withdraw competition in Ashington on the basis that Arriva withdraw from Hexham was very dodgy, even without those emails. I think it crossed the line.

What abhorrent business practices did Stagecoach deploy in Lancaster?

The same tactics they employed everywhere else:
sound out the municipal for purchase,
wait for the municipal to commit to selling,
then register competing services against the municipal,
then offer "recession buster" fares on these competing routes, causing the municipal to become financially distressed and also discourage competing offers,
then buy the municipal at a significant discount because there is financial distress and all other buyers have been scared off.

In Lancaster's case, they screwed the taxpayer out of up to half a million quid.

 

[TheGrandWazoo]

What abhorrent business practices did Stagecoach deploy in Lancaster?

The Major government were actively promoting the divestment of council owned businesses after the 1992 election. Stagecoach approached Lancaster City Council but they decided to put the business on the market, getting several initial offers from businesses such as Blackpool Transport and MTL. However, Stagecoach decided NOT to bid and then increased the level of their services in the area including on jointly operated services, registering over the LCT journeys (which happened to be the most lucrative).

That move depressed the offers and Stagecoach then countered with a bid to buy the assets, namely some newish Atlanteans and the depot (which allowed them to close their small Lancaster and Morecambe depots). That effectively forced the council's hand and so they accepted the Stagecoach offer and wound the business up.

Arguably, LCC got a better deal in the end because of the sale of the depot site (in the main) whilst Stagecoach got the ability to rationalise their depots and a largely monopolistic position.

 

[TheGrandWazoo]

Go were smart, they bought the independents and it did give them leverage against Arriva: Jayline and Stanley Taxis in County Durham, and Northumbria Coaches, spring to mind. But agreeing to withdraw competition in Ashington on the basis that Arriva withdraw from Hexham was very dodgy, even without those emails. I think it crossed the line.

They backed Arriva into a corner. They could have the competition on the Cramlington corridor and have that pain. If they turned out vehicles against Go Ahead (e.g. Saltwell Park) to fight back, Go Ahead would turf out 3 vehicles to every one Arriva. Alternatively, they carved out a deal - the emails really reflected "blackmail" (if that's not a controversial term) by Go Ahead rather than some cosy arrangement.

That said, I wonder what would have happened if Arriva had said ok, we'll go head to head with Go Ahead. Huntley gambled, rightly, that they didn't have the stomach.

 

[Tetchytyke]

Alternatively, they carved out a deal - the emails really reflected "blackmail" (if that's not a controversial term) by Go Ahead rather than some cosy arrangement.

Definitely. It wasn't a cosy arrangement, it was Go forcing the issue, although the resulting truce was very very amenable to both sides. The resulting effect has been extremely anti-competitive; for all the glossy sheen, Go services are extraordinarily expensive, even for an area which has high prices and mediocre quality.

My memory is hazy, did all this come out before or after Huntley died in a climbing accident?

 

[MotCO]

LCSE certainly did win some LRT work - I think is was in the Croydon area. Before it all became Arriva, I think some of it was operated under the Londonlinks name rather than the London & County name they used elsewhere

LCSE / Kentish Bus did run some LRT services in and around Orpington. They ran the 51(Woolwich to Orpington) using Scottish Atlanteans (the panoramic window ones, and leaking roofs!), and the 493 (Orpington - Ramsden Estate, now R9).

 

[Robertj21a]

There are countless examples of Stagecoach using quite frankly abhorrent business practices to push the incumbent operator out of business. Darlington's the poster boy for it but Lancaster, Preston, Perth, Bognor Regis, Portsmouth, Fife, the list goes on and on.

It goes to show just how pathetic and toothless competition legislation is in the UK, even now. Stagecoach got away with it time and time again. They still do. Eight MMC referrals in four years. Eight! In four years!

As I said, if Stagecoach came knocking you didn't turn them down. A bit like the Mafia, when you think about it.

As an aside, I always genuinely wonder how Brian squares his disgusting business practices with his professed devout Christian faith. I certainly don't remember Jesus teaching "screw over thy neighbour to get his business at a knockdown price", and I've the "benefit" of a full Catholic education. It must take some pretty heavy-duty mental gymnastics.

I know you like bashing Brian Souter at every opportunity but when you start including religion it only creates an unnecessary diversion from the actual bus operations and/or his general approach to his various businesses

 

[MotCO]

I do remember in Merseyside loads of old clapped out buses that should belong in a museum were brought out.

Did this period also see the rise of Ensignbus, as a conduit to move buses deemed surplus to requiremens to some of the newly expanding operators?

 

[MotCO]

There also seems to have been a lot of fluctuation in the quality of publicity. Some councils were brilliant from the outset, others have been rather more up-and-down in terms of what they produced, either themselves or in conjunction with other publishers - Connections were certainly strong in random areas of the south-east (although I don't think they ever covered a whole county... I'd be interested to know just which areas they did cover, beyond parts of Kent and parts of Hampshire).

Kent CC did produce a county-wide bus map for a number of years which was very helpful.

 

[Tetchytyke]

when you start including religion it only creates an unnecessary diversion from the actual bus operations and/or his general approach to his various businesses

To an extent it probably does, but as I said, I find it very hard to square off his devout Christian faith and Stagecoach's attitude that all's fair in a bus war. I don't get my head around it at all.

I'm not trying to divert the discussion, I just don't understand it. I probably never will.

 

[MotCO]

Also, the property aspect was important as there were some NBC firms that had a substantial property portfolio.

Linked to this was the end of the Central Works (though appreciate a few survive such as Go North East). Many NBC ones had been hived off anyway to form separate companies that were all sold as a job lot to some asset strippers (called Frontsource?). Instead, operators began contracting out many specialist services such as heavy engineering, refurbishment etc.

The other visible change was the sale of bus garages for housing developments (e.g. Dunton Green), and more open field operations (not literally, but less under-cover facilities).

Also to note the rise of companies doing refurb work - I'm thinking of Hants & Dorset Trim, Bus & Coach World, and Thorntons.