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TransEcon has been commissioned to conduct a research study into the strategic issues facing the passenger railway industry in Britain.

Extracts from this document...

Introduction

1. Introduction On order of instruction by a group of leading railway magazine TransEcon has been commissioned to conduct a research study into the strategic issues facing the passenger railway industry in Britain. 1.1. Objectives The report consists of the following points: * The structure of the railway industry in Britain * Train Operating Companies, ownership patterns, and length of franchise * Trends in passenger numbers * Main external factors affecting the TOC's * Analysis of TOC's according to Porters 5 forces * Trends in profitability of Virgin Rail Group LTD * Recommendation of strategies that could be adopted by Virgin Rail Group LTD 1.2. Literature search The main sources of information used were researched from a number of websites and reports, which are listed in the bibliography. 2. Introduction to Britain's rail industry In the period between the second world war and 1996, rail services in the UK were provided by a single sector public company - British Rail. Despite the Conservative Governments enthusiasm for privatization, the strength of public feeling regarding the importance of rail transport prevented it from acting sooner. The pivotal moment occurred with the publication, in 1992, of the Conservative Government's white Paper, New Opportunities for the Railways. The paper contained the following key features for the privatization of the railway industry: * The track and infrastructure would become the responsibility of a new track authority, Railtrack PLC * The operation of passenger services would become managed and operated through the private sector via a series of franchises * Rights of access to the railway would be available to private operators without a franchise, with a rail regulator appointed to oversee ...read more.

Middle

First Great Eastern 5. Silverlink 6. South central 7. South West Trains 8. Thames Trains 9. Thameslink 10. West Anglia Great Nothern London and SE operators Connex South Eastern holds the longest franchise length of 20 years, due to end in December 2021 and operates commuter services between central London and the south east London suburbs, the whole of Kent and part of Sussex. Thameslink holds the shortest franchise term of 7 years and 1 month terminated in april 2004. The routes operated by this company are between Bedford and Brighton via central London and also between Luton and Sutton via Wimbledon. Its north/south routes serve 5 major stations in central London, and two airports - Gatwick and Luton. * Regional operators 1. Anglia Locals 2. Arriva Trains Merseyside 3. Arriva Trains Nothern 4. Central Trains 5. First North Western 6. Gatwick Express 7. Island Line 8. ScotRail 9. Wales and Border Trains 10. Wessex Trains Regional operators Arriva Trains Merseyside has the longest franchise time of 25 years terminating in July 2028. It operates rail services between Liverpool and Southport, Ormskirk, Kirby, Hunts Cross, New Brighton, West Kirby, Chester and Ellesmere Port. Scotrail holds the shortest term of 7 years terminating in September 2003 providing the vast majority of services in Scotland extending to Newcastle via Carlisle and Hexham. It also provides the Caledonian sleeper services between London Euston and Glasgow.4 5. Passenger numbers Since 1980, the number of journeys made by national rail has gone up by 28 per cent, from 760 to 976 million. ...read more.

Conclusion

* The company should try to improve passenger services i.e. reduce the number of delays etc., as it is the passengers who are the main source of revenue 9. Conclusion To date, the passenger rail industry has been going through great difficulty, with years of under funding and under investment, not to mention the accidents that have also taken place. But there are a number of reasons as to why the passenger rail transport may improve in the near future. * The Government has shown that it is committed to the public transport. * The private Sector operators are starting to make significant improvements in a new rolling stock, which will allow them to improve the quality of service that they offer. * Rail track have announced a 27bn investment programme aimed at reducing delay, as well as expanding the network * Finally as road congestion charges worsens, the public perception of rail travel as an alternative to the private motor will change, as a result, the railways share of the overall passenger market may begin to increase. APPENDIX 1 Franchise lengths and Franchisee13 1 Key Note market report 1999, Rail Travel, 3.Industry Background, Recent History 2 http://en.wikipedia.org/wiki/Rail_transport_in_the_United_Kingdom 3http://news.bbc.co.uk/1/hi/uk/1760638.stm -Who runs the railways? 4 Appendix 1, franchise lengths and franchisee, Appendix 2, individual operators and routes 5 http://www.dft.gov.uk/stellent/groups/dft_transstats/documents/page/dft_transstats_026295.hcsp 6 http://www.jrtr.net/jrtr08/f15_bra.html, Feature: Restructuring Railways (part 2) The Privatization of Railways in Britain, Bill Bradshaw 7 http://news.bbc.co.uk/1/hi/uk/540440.stm, Rail network 'needs �41bn investment' 8 http://www.dft.gov.uk/stellent/groups/dft_transstats/documents/page/dft_transstats_026295.hcsp 9 http://news.bbc.co.uk/1/hi/uk/3020938.stm, toilet waste 'hampers rail repairs' 10 http://www.innovations-report.com/html/reports/logistics/report-15326.html 11 Key Note market report 1999, Rail Travel 12http://fame.bvdep.com/cgi/template.dll?product=1&checkathens=1&user=uow0307977&pw=%3CQKmn6gPANE2pn%2B5U%2Fg%3E 13 On Track Rail performance trends Oct 2002 - Mar 2003, page 52 TUFAUL HAQUE W03094171 1 ASSIGNMENT 2 4MBS401 ...read more.

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