Stagecoach gets short extension to East Midlands Trains franchise
Stagecoach Group confirmed on Tuesday that its subsidiary, East Midlands Trains, has agreed a new short-term rail franchise with the Department for Transport.
The FTSE 250 passenger transport operator said the new franchise would begin on 3 March, and run until at least 18 August, ahead of the award of a new long-term franchise by the department.
It said the DfT had the discretion to extend the franchise by up to 24 weeks on terms that had already been agreed.
Under the new agreement, Stagecoach claimed customers and communities would continue to benefit from a number of improvements, including the delivery of the £1.5bn Midland Main Line upgrade to improve capacity and reduce journey times.
They would also see a continuation of the company’s investment programme to improve stations and trains, which included accessibility improvements at stations and on trains, as well as the roll out of smart ticketing in March as part of a wider programme on National Rail.
In addition, East Midlands Trains would be focused on ensuring readiness for the new franchise, including helping to put in place plans for extra seats from 2020.
Under the terms of the new contract, revenue risk would sit primarily with the DfT.
East Midlands Trains expected to earn a modest profit under the contract, with a profit sharing arrangement with the DfT set to apply.
“East Midlands Trains remains the UK's most punctual long distance railway, a position it has held for the last 10 years,” the Stagecoach board said in its statement.
“Last year saw East Midlands Trains work with Network Rail to successfully deliver a £200m re-signalling and upgrade project at Derby.
“Over the last 11 years, customers have benefited from millions of pounds of investment to improve services, whilst taxpayers have benefited from substantial premium payments to government.”
In March 2017, the Department for Transport revealed a shortlist of operators for the next East Midlands franchise, which consisted of Stagecoach, Arriva UK Trains, and a consortium of FirstGroup and Trenitalia.
The FirstGroup-Trenitalia bid had since been withdrawn, with the DfT yet to make a final award.