Why has National Express Group lost so many franchises?

[Clarence Yard]

HH, The lack of capacity is what I don't agree with but I absolutely agree with you on the level of Guarantee. A proper level of Guarantee would have stopped one bid dead in it's tracks and that level should have been made clear and strictly adhered to from the start.

The FG loading figures were quite high but there was a method behind them. That (very different) method, quite properly, didn't fully come out in the MP's discussion on the whole debacle as it was regarded as business sensitive. It still is, to an extent.

The whole ICWC bid procedure was a stream of DfT ineptitude from start to finish. You got the distinct impression they were making it up as they went along whilst wanting to keep all the bidders in the competition.

 

[HH]

Yes DfT were inept. What's more the guy that was criticised severely in the Laidlaw report actually worked on the Essex Thameside franchise. Further having seen what salary is offered by DfT at this level for carrying such a responsibility, I'm not surprised that they're inept.

 

[Class 170101]

Wales & Borders
West Anglia Great Northern
ScotRail
Wessex Trains
Midland Mainline
Silverlink
Gatwick Express
Central Trains
National Express East Anglia

Silverlink they never bid or even bothered with the Pre Qualification for the replacement franchise (London Midland) as I recall. NXEA was lost because of the NXEC debacle, the DfT decdlined to offer the extension even tough NXEA met all the criteria it was still a the sole discretion of the DfT. Central Trains disappeared into East Midlands (as did Midland Mainline) which NX put a bid in for, I believe, and London Midland and New Cross Country.

Gatwick Express was subsumed into Southern and Wessex into FGW. Scotrail they lost to First Group and have now lost a second time, this time to Abellio.

WAGN split with the GN bit going to First and WA becoming part of NXEA until that was lost as described above.

 

[Robertj21a]

As I worked for a bidder I had access to quite a bit more information than was available to the public and I analysed the FirstGroup figures in depth. When I say that they couldn't have carried the number of passengers needed for that revenue I do so on the following basis:

1. Their bid did not achieve the 10% CAGR revenue growth through increased yield, it was largely through increased patronage, around 7.5% CAGR IIRC.

2. They admitted that the numbers required them to achieve an average occupancy of 75% by the end of the franchise (and they kept growing in the possible two year extension as well). Their argument was that TPE had 65% and well 75% isn't that much bigger. However ICWC is a completely different railway to TPE, e.g. the most crowded day is Sunday for a starter.

3. I'd seen our crowding analysis and knew that you needed more seats as soon as you reached about 5% CAGR. Virgin bid just over this and put in a little extra seating capacity. The difference between 5% CAGR and 7.5% over 15 years is huge (roughly speaking 5% would double occupancy and 7.5% treble).

4. The small number of additional units in their bid was insufficient to carry this extra patronage.

There's one other reason why 10% CAGR was an overbid. There is zero chance of having no economic downturn over 15 years (17 years if you factor in the extension). As soon as you have just one bad year the rest of your bid is bad.

Of course First have form here - they overbid for FGW. Luckily for them Dean Finch did a smart deal which allowed them to cut and run. Dean is now at National Express...

Thanks, very interesting.

I've never worked in the industry but I do have a head for figures and well recall my immediate reaction when I saw how the numbers escalated towards the end of the franchise. If it looked unreal to a layman it should have looked rather blatant to those more involved.

.

 

[turboslug]

In national express days there was a very limited (once or twice daily) through service between Holyhead and Cardiff, sometimes via Llandudno. They used their own crews for this, not FNW's.

Virgin certainly used FNW drivers, until Voyagers cane in and they started taxiing in their own from Liverpool and Manchester instead, but I'm not sure about the conductors.

The daytime Cardiff Holyhead train used wales & west guards but fnw drivers were used for a while, the evening Cardiff to Holyhead & early morning Holyhead to Cardiff used fnw crews between Holyhead & chester/crewe as I worked these trains often when I worked for fnw. also before atw were told they were losing there south west England to south wales services there were plans for Holyhead to Exeter trains every 2 hours with a few trains going as far as Plymouth & penzance.

 

[craigybagel]

The daytime Cardiff Holyhead train used wales & west guards but fnw drivers were used for a while, the evening Cardiff to Holyhead & early morning Holyhead to Cardiff used fnw crews between Holyhead & chester/crewe as I worked these trains often when I worked for fnw. also before atw were told they were losing there south west England to south wales services there were plans for Holyhead to Exeter trains every 2 hours with a few trains going as far as Plymouth & penzance.

Cheers for that, I work with the guards who used to work that service but didn't know the full details about how it worked. I know it was very much a Marmite job, although personally I'd love to do the odd trip down the coast now for variety!

 

[thenorthern]

Silverlink they never bid or even bothered with the Pre Qualification for the replacement franchise (London Midland) as I recall. NXEA was lost because of the NXEC debacle, the DfT decdlined to offer the extension even tough NXEA met all the criteria it was still a the sole discretion of the DfT. Central Trains disappeared into East Midlands (as did Midland Mainline) which NX put a bid in for, I believe, and London Midland and New Cross Country.

Gatwick Express was subsumed into Southern and Wessex into FGW. Scotrail they lost to First Group and have now lost a second time, this time to Abellio.

WAGN split with the GN bit going to First and WA becoming part of NXEA until that was lost as described above.

As far as I remember National Express never put in a bid for the West Midlands Franchise and neither did Stagecoach, First or Arriva. The only companies that did were Serco-Ned Rail, MTR of Hong Kong and Govia. In the end MTR withdrew before the results were announced and Govia were eventually awarded the franchise.

 

[HH]

As far as I remember National Express never put in a bid for the West Midlands Franchise and neither did Stagecoach, First or Arriva. The only companies that did were Serco-Ned Rail, MTR of Hong Kong and Govia. In the end MTR withdrew before the results were announced and Govia were eventually awarded the franchise.

All three Midland franchises came up at the same time. Most people thought that West Midlands was the least attractive of the three and therefore put it as their last choice.

 

[gray1404]

I think its time for someone else to have a go at running WC. Virgin is not what it used to me. They've taken away the railcard offer with Off Peaks now so for we that was the last straw.

 

[thenorthern]

I think its time for someone else to have a go at running WC. Virgin is not what it used to me. They've taken away the railcard offer with Off Peaks now so for we that was the last straw.

They were planning to remove it if they had won the franchise in 2012 although as they won a direct award they thought it would make them look bad given the fuss they kicked up about First winning the franchise.

I think all the bidders for the West Coast franchise planned to remove the off-peak railcard easement.

 

[craigybagel]

I think its time for someone else to have a go at running WC. Virgin is not what it used to me. They've taken away the railcard offer with Off Peaks now so for we that was the last straw.

Yes, let's give it to one of the companies that does still let you travel in the peak with an offpeak railcard ticket!

Ah, wait a minute.......

 

[dk1]

Yes, let's give it to one of the companies that does still let you travel in the peak with an offpeak railcard ticket!

Ah, wait a minute.......

Beat me to it

 

[Hadders]

I think its time for someone else to have a go at running WC. Virgin is not what it used to me. They've taken away the railcard offer with Off Peaks now so for we that was the last straw.

So who do you think should run it?

Sometimes it's better the devil you know.

 

[321over360]

Would be interesting if National Express get back the East Anglia franchise as admittedly, most of NXEA's issues were those outside of their control, however unlike Abellio, they seemed to run a fairly better train service than we have at the moment, though as they are in the running, shall have to see if the DFT award them the Franchise over Abellio/Stagecoach or First, the latter I definitely do not want to see in charge of the East Anglia franchise given they love increasing their fares considerably, additionally, fares stayed at a much regular level under NXEA than they are under AGA but this could be down to AGA recouping more money as they are refreshing trains (at the loss of the Chicken drumstick seats on the MK3s).

 

[pemma]

As far as I remember National Express never put in a bid for the West Midlands Franchise and neither did Stagecoach, First or Arriva. The only companies that did were Serco-Ned Rail, MTR of Hong Kong and Govia. In the end MTR withdrew before the results were announced and Govia were eventually awarded the franchise.

Only pre-selected bidders can submit a bid. Serco wanted to bid for both the Northern and TPE franchises but they didn't get shortlisted so couldn't.

 

[HH]

Only pre-selected bidders can submit a bid.

But in this case, as I already explained, bidders had a choice of 3 Midland franchises and most preferred to bid for one or two of the other two if they passed pre-qualification. Certainly that explains some of the missing bidders, although I can't be certain about NX.