FGW requests new franchise terms

[whole diary]

[Trowres]

From the Guardian:
http://www.guardian.co.uk/uk/2008/oct/13/transport

"...In a warning that the government has put too much strain on the rail network, the operator has asked to renegotiate the terms of its ^1.1bn contract. It wants to reduce payments so it can buy more carriages and has warned it is overspending in order to accommodate commuters."

[Lee]

It should be noted that the Guardian article is referring to a presentation which FGW^▸ (First Great Western) made to the DfT^» (Department for Transport - about) in May 2008, which was around the time that 3-coach Portsmouth-Cardiff trains were introduced as part of the Remedial Plan.

In some respects, its not surprising that such issues were being discussed at that time.

 

[devon_metro]

Excellent news, First related franchises always seem to bring new stock.

FGE - Class 360 desiros
FTPE^» (First TransPennine Express - website) - Class 185 Desiros
FNW - Class 175
FGW^▸ (First Great Western) - Class 180

Hopefully a 3 coach commuter dmu derived from London Overgrounds brand new class 378s can be produced. (http://upmain.fotopic.net/p53614372.html)

Perhaps removing the pacers from our rails!

[Tim]

In what way has the "government put too much strain on the network"? 

The increase in demand was predicted, if FGW^▸ (First Great Western) didn't see it coming or ignored it then why should the Government bail them out?

it is emiently sensible for FGW to pay less of their income to the governemnt and use it to buy new trains instead, but if they want to pay less of a premium to the Governemnt then they shouldn't have entered the bid that they did.  They made their beds and they can lie in it.

As for the overspend to accomodate commuters they ought to have predicted that commuters would not let them get away with the rubbish service they provided a year ago.  Despite the "overspend" they are still making a profit so I can't feel sorry for them in the slightest.

[6 OF 2 redundant adjunct of unimatrix 01]

the trains are not overcrowded in the governments view until pasengers have to sit on the roof which they deem slightly unsafe only on electrified routes

[dog box]

 Tim.....why are FGW^▸ (First Great Western) any different than  the big banks the government have decided to bail them out so why not a renegotiated bid to bring new rolling stock in for say Pompy/Cardiff and redistribute some of the 158s back to Exeter
your post is rather negative and puts forward nothing to improve conditions for rail travellers in FGW area.
Where by additional new unit stock would increase capacity provide better trains and prehaps allow FGW to run more trains

[Btline]

All TOCs^▸ (Train Operating Company) as a whole (+ the gov) need to bank together and slap a HUGE order onto the current Class 172 order, trains which can continuously be built and rolled out for the next ten years. This would replace all Pacers and Sprinters (minus 158s), and have extra left over.

It would be relatively cheap, as it would be a rolling line. The un air conned trains/ buses can then be scrapped.

We need to stop these small orders, and have one big one, so all new trains are of a standard design everywhere. Otherwise, by the time the West Fleet is sorted, the Thames Turbos will die and the whole long and expensive process will start again (with overcrowding in the meantime).

[eightf48544]

All TOCs^▸ (Train Operating Company) as a whole (+ the gov) need to bank together and slap a HUGE order onto the current Class 172 order, trains which can continuously be built and rolled out for the next ten years. This would replace all Pacers and Sprinters (minus 158s), and have extra left over.

Better still why not 372s put the wires and do away with the diesels as far as possible.

But don't forget it's not in a Tocs interests to own any rolling stock as they might not get a renewed franchise and they would be dependant on the new TOC taking on the stock or renting it to someone else. If all their rivals have also bought new stock there may not be a market.

Also there is absolutely no risk in being a TOC you have no real assets only staff and rental costs which are paid from the fare box. If the fare is not big enough you stop paying pemiums and the government takes the franchise away. Who remembers GNER^▸ (Great North Eastern Railways)? The trains will still run for under BR^▸ (British Rail(ways)) like South Eastern until the franchise is relet to buggins. Most staff will have worked for several TOCs since privatisation even if they are doing exactly the same job they were doing in BR days.

We must keep asking the Wolmar question "What are TOCS for?"

After several years of asking he still doesn't seemed to have been given a satisfactory answer.

[willc]

All TOCs^▸ (Train Operating Company) as a whole (+ the gov) need to bank together and slap a HUGE order onto the current Class 172 order, trains which can continuously be built and rolled out for the next ten years. This would replace all Pacers and Sprinters (minus 158s), and have extra left over.

Even before the current financial meltdown, the leasing companies and the banks were reported to be increasingly reluctant to pay for any substantial build of new diesel rolling stock, because they didn't want to get landed with a lot of trains that might be overtaken by any extension of electrification and which no-one wanted to use as a result.

Given that rolling stock typically has a working life of 25-30 years, you can't blame them for caution, especially after the very positive things Ruth Kelly was saying about electrification before she left office. The Labour Party conference was told "Labour will develop options for a rolling programme of electrification of our railways ^ potentially the largest programme of electrification in our history."

If, for example, Transpennine Express routes are wired - which would be eminently sensible, given the connection between the East and West Coast routes this would provide, plus the performance benefits of electric power climbing through the hills - the Class 185 fleet (and some 170s) would be looking for a new home, with many years of life left in them, so would you want to pay for lots of 172s with that prospect looming?

[Btline]

All TOCs^▸ (Train Operating Company) as a whole (+ the gov) need to bank together and slap a HUGE order onto the current Class 172 order, trains which can continuously be built and rolled out for the next ten years. This would replace all Pacers and Sprinters (minus 158s), and have extra left over.

Even before the current financial meltdown, the leasing companies and the banks were reported to be increasingly reluctant to pay for any substantial build of new diesel rolling stock, because they didn't want to get landed with a lot of trains that might be overtaken by any extension of electrification and which no-one wanted to use as a result.

Given that rolling stock typically has a working life of 25-30 years, you can't blame them for caution, especially after the very positive things Ruth Kelly was saying about electrification before she left office. The Labour Party conference was told "Labour will develop options for a rolling programme of electrification of our railways ^ potentially the largest programme of electrification in our history."

If, for example, Transpennine Express routes are wired - which would be eminently sensible, given the connection between the East and West Coast routes this would provide, plus the performance benefits of electric power climbing through the hills - the Class 185 fleet (and some 170s) would be looking for a new home, with many years of life left in them, so would you want to pay for lots of 172s with that prospect looming?

True. But I was taking the pessimistic view that the electrification idea will not come to fruition - at least not for many years!

But more carriages are needed NOW.

At this rate, the HSTs^▸ (High Speed Train) will be retired by IEP^▸ (Intercity Express Program / Project.), and then bought up by TOCs for branch line work!

[Lee]

The Conservatives are planning to increase the length of rail franchises to between 15 and 20 years, the idea being that train operators use the revenues generated by the longer contracts to buy their own carriages and to fund infrastructure improvements (link below.)
http://www.rmtbristol.org.uk/2008/10/tory_plan_to_cut_network_rails.html#more

Train operators would also be invited to bid against Network Rail for engineering tasks. However, they would be barred from bidding for large-scale engineering work such as the ^8.6bn west coast main line upgrade. Instead, they would be allowed to bid against Network Rail for public funds for smaller tasks such as platform lengthening, station improvements and signalling upgrades.

The proposals are expected to form part of a rail review to be published before Christmas.

[G.Uard]

Further fragmentation is the last thing the industry needs.  Under the Tory proposals, we could see a slimmed down NR^» (Network Rail - home page) entirely dedicated to large infrastructure work, whilst services like signalling and emergency response are hived off elsewhere?

On the other hand, perhaps this presages the first move in a return to the inter-war years style of railway grouping with all services ultimately brought back in house? Is the hitherto anathema of re-nationalisation a distant gleam in Mr Cameron's eye?

[Lee]

On the other hand, perhaps this presages the first move in a return to the inter-war years style of railway grouping with all services ultimately brought back in house? Is the hitherto anathema of re-nationalisation a distant gleam in Mr Cameron's eye?

Article quote :

A party source said the Conservatives had stepped back from even more radical solutions such as splitting Network Rail into eight regions and integrating track ownership with franchise ownership. Such a move would have returned the railways to the British Rail era, and the party had opted for "evolution, not revolution".

This Christian Wolmar piece argues that events could provide an opportunity to renationalise the railways (link below.)
http://www.guardian.co.uk/commentisfree/2008/oct/13/transport-railtravel

[Tim]

 Tim.....why are FGW^▸ (First Great Western) any different than  the big banks the government have decided to bail them out so why not a renegotiated bid to bring new rolling stock in for say Pompy/Cardiff and redistribute some of the 158s back to Exeter
your post is rather negative and puts forward nothing to improve conditions for rail travellers in FGW area.
Where by additional new unit stock would increase capacity provide better trains and prehaps allow FGW to run more trains

I don't like the idea of the Government bailing out the banks either, but the difference is that First going bust and being replaced will not cause decades of damage to the international economy.

I would support the Government spending money on the network to improve capacity, but you must remember that First is a private company and profit comes first (nothing wrong with that).  Ifyou give FGW more money they will give it to their shareholders unless they are contractually prevented from doing so.  It is would be wrong to give FGW extra money to enable them to merely meet their franchise commitments which they freely entered into and which they must be held to.  I do think that it is not unreasonable to enforce all contracts which have been freely entered into and the FGW franchsie is such a document.  If you buy a car for ^10,000 and you wouldn't entertain the dealer demanding an extra ^1,000 on delivery because his costs have gone up.  the cost-rise would be his problem not yours.   That is how contracts work.  In exchange for money (either a direct subsidy or via the farebox) the risk, cost and problems of running the railway are transfered to a private company.  If FGW was unable to meet its franchise conditions and needed more cash to do so that that is firmly a FGW problem not a tax-payer problem

I think you need to draw a distinction between bailing FGW and investing extra money (perhaps channeled via FGW) to improve capacity.

I am negative about the first option only and positive about the second. 

One problem with this discussion is that because of "commercial confidentiality" we don't really know whether FGW were in fact in breach of their franchise a year or two ago.  As I recall a newspaper suggested that they were and FGW threatened to sue them (but didn't).  I suspect that they were in some sort of difficultly because Kelly was able to ring some improvements out of them, but we are all really in the dark on the issue.

I think of a contract, whether it is as complicated as a franchise agreement or as simple as a ticket to travel, as a two-way promise and I do think that people and companies should keep theirpromises whethever possible and be punished for breaking them.   

[IndustryInsider]

To put it simply, the Government were naive/stupid to under-specify the franchise so badly, and First Group were stupid/naive to overbid for it to such an extent. Their bid far outnumbered those from the other preferred bidders, so there's no surprise that a greedy government accepted it without a second thought! It should be too late for FGW^▸ (First Great Western) to cry about it now.