First South Western Rail Franchise Update

 

First are getting ready for the new South Western rail franchise…

FirstGroup and MTR announce that Andy Mellors has been appointed as Managing Director of the new South Western rail franchise, which launches on 20 August.

Andy Mellors has 25 years of experience in the industry. He has held a number of senior leadership roles since joining FirstGroup in 2002 and is currently Engineering Director and Deputy Managing Director at Great Western Railway, having previously held a similar role at First ScotRail. Most recently, he has been responsible for leading the transformation of the GWR rolling stock fleet both through the introduction of new electric trains in the Thames Valley, and the imminent entry into service of the Intercity Express Trains – the first major intercity fleet to be introduced on the UK rail network for many years. This experience will be vital given the exciting plans for a brand new fleet of 90 trains, consisting of 750 carriages on the franchise, plus a refurbishment of existing rolling stock. Andy is a Chartered Engineer and a Fellow of the Institution of Mechanical Engineers.

Commenting, Steve Montgomery, Managing Director First Rail said: “I am delighted to announce the appointment of Andy as Managing Director of the new South Western franchise. Andy has an exceptional track record of improving rail services for passengers. He will head up an experienced team that will introduce our exciting plans for better customer journeys, and keep people moving and communities prospering across the South Western network.”

Commenting, Jeremy Long, CEO – European Business, MTR said: "We're delighted that Andy has agreed to come on board. His track record speaks for itself and will help us deliver the excellent services passengers want to see."

Commenting, Andy Mellors said: “I look forward to leading the team at the new FirstGroup and MTR South Western franchise, and to build on the respected foundations established by the current South West Trains employees. We will offer the tangible benefits that customers and stakeholders have told us they want, on a key part of the country’s railway network which connects London to key towns and cities across the region. Passengers on our franchise can look forward to new and better trains, more seats and services, quicker journey times, enhanced stations and more flexible fare options.”

 

However its not all plain sailing so far…

First Group has been asked by the Competition and Markets Authority (CMA) to address concerns over reduced competition on services between London and Exeter following its successful bid for the new South Western franchise. The new franchise was awarded to First MTR South Western, a consortium of FirstGroup and Hong Kong's MTR, earlier this year. It will initially run for seven years from 20 August 2017 to 18 August 2024. A fleet of 90 new trains will be used on routes between London Waterloo, Reading, Bristol, Exeter, Weymouth, and Portsmouth.

First Group also currently operates the Great Western Railway (GWR) franchise, which runs the only other train service between London and Exeter. The CMA has investigated the award of the South Western franchise and has found no competition concerns on the majority of routes. However, it said first having control of both London to Exeter services could "reduce competition on the route, leading to higher fares or worse service for passengers".

Andrea Coscelli, acting chief executive and decision maker at the CMA, said: "This is a crucial rail route to the South West, used by around half a million passengers a year. It's therefore vital that passengers do not suffer as a result of reduced competition.

"The CMA believes that without its intervention, FirstGroup may be able to increase fares for passengers between London and Exeter, as it will be the only rail operator running all services on this route. We look forward to hearing from the companies involved about how they think they can overcome this."

A FirstGroup spokesperson said: "We have been discussing our plans for the new South Western franchise with the CMA for several months. Now that this update gives more clarity, we look forward to submitting our proposals on this issue which we envisage will satisfy their concerns."

The CMA has given First and MTR the opportunity to put forward proposals to address its concern.

The regulator previously raised concerns over the decision on the award of the Northern franchise to Arriva. These were addressed by the implementation of price caps for the affected lines.

11 July 2017: The CMA has decided, on the information currently available to it, that it is or may be the case that this merger may be expected to result in a substantial lessening of competition within a market or markets in the United Kingdom. This merger will be referred for a phase 2 investigation unless the parties offer acceptable undertakings to address these competition concerns. The full text of the decision will be available shortly.