The announcement was long awaited. It was like a episode of ‘Blind Date’ Just who were Virgin/Stagecoach wooing for their planned West Coast Partnership franchise bid?
Now we know, it’s the French Stage Railway SNCF.
Virgin and Stagecoach had no choice but to get a third partner on side. The Government has been insistent that the prospective bidders must have high speed experience and that was a box that Virgin or Stagecoach were unable to tick without an additional partner coming on board.
So Virgin Trains (Virgin/Stagecoach) will partner with the French high speed operator, SNCF, in its bid for the West Coast Partnership. This will see the expertise of Virgin, Stagecoach and SNCF brought together to compete for the combined West Coast / HS2 franchise.
The Government has announced that the West Coast Partnership franchise will run from 2019, that it will include the first few years of operation of HS2.
However, following the trend with the current East Coast franchise where Virgin has just a 10% holding to Stagecoach’s 90%, Virgin is again taking the smallest shareholding. It is unknown whether this is Virgin losing confidence in the rail market or merely restricting an future risk to the business. The shareholding for the West Coast Partnership bid is Stagecoach 50%, SNCF 30% and Virgin 20%.
Patrick McCall, Virgin Trains co-Chairman said: “I’m delighted that SNCF has come on board, and together we will put forward what we hope is the winning bid for the next West Coast, and first HS2, franchise. We’ve just celebrated twenty years of Virgin Trains and this news puts us in the best possible position to make it thirty. We’re thrilled about the prospect of continuing and improving this record of innovation with the UK’s first long distance high speed network, as well as with our friends and communities along the West Coast.”
SNCF is a global leader in high speed rail. It operates the largest fleet of high speed trains in Europe (nearly 430 trainsets) and, not including Thalys or Eurostar, runs around 700 high speed rail journeys per day in France and internationally at speeds of up to 320 km/h, the fastest in Europe. SNCF has been operating its iconic TGV service since 1981 and in 2013 launched Ouigo, its low-cost high speed service. SNCF’s high speed division recorded turnover of €7.5 billion in 2016 of which 27% was from international operations with 27 million passengers journeying on high speed trains outside of France.
Martin Griffiths, Chief Executive of Stagecoach Group, said: "This creates a powerful world-class partnership, bringing together the team which has transformed inter-city rail travel in the UK with the most recognised and capable high speed operator in Europe.
"The new franchise has an important role to play in delivering the improvements and space on our railway that can support our communities and economy. Together, we have a very strong track record of working effectively with other rail partners and infrastructure providers, as well as using cutting edge technology to achieve a step change in customer service."
Guillaume Pepy, Chairman and CEO of SNCF said: “This is a very exciting development for SNCF. We are world leaders in high speed rail. SNCF has a long-standing commitment of working in partnership with British companies, using their local knowledge and sharing our expertise and experience. Today, we are delighted to announce this next step in our commitment to UK rail, working with partners who have demonstrated their own expertise in long distance rail services and are highly regarded in the industry. We appreciate Stagecoach’s widespread expertise across a variety of transport modes and Virgin’s reputation for its renowned customer experience. In partnership, we will deliver a successful HS2 service for the UK.”
Virgin, Stagecoach, and SNCF have already worked together on the first stage of the West Coast Partnership bid, the ‘expression of interest’, which was submitted yesterday. The partners will now prepare for the “Invitation to Tender” which is expected to be issued by the end of the year.