Branson faces fight to challenge Eurostar

Telegraph

a day ago

Sir Richard Branson faces a fight to fulfil his dream of operating trains through the Channel Tunnel after the rail regulator concluded there was room for just one new entrant.
The ruling means that Sir Richard must convince the Office of Rail and Road (ORR) that he is better placed to provide competition to Eurostar than three rival bidders.
While the ORR found that the only UK depot capable of servicing Channel Tunnel trains has room to handle more, it made clear that vital maintenance capacity is extremely limited.
The regulator said: 'Taken together with Eurostar and applicants' initial plans, the assessment suggests there is room for at most one new operator, or for Eurostar to grow.'
The chosen bidder will win the right to compete with Eurostar in the lucrative Paris market and potentially launch new services to cities such as Bordeaux, Marseille, Frankfurt and Zurich.
The ruling is poised to pitch Sir Richard's Virgin Trains against Gemini Trains, chaired by Labour peer Lord Berkeley, which has said it would provide services from London's St Pancras International to Paris and Brussels with a fleet of 10 trains.
Also in the running is Trenitalia, the main operating arm of Italy's state railway company FS Italian, which is expected to partner with a fourth bidder, Evolyn, backed by the Spanish Cosmen family, the leading investor in Mobico, formerly National Express.
Virgin Trains has said it would order a dozen trains worth around £500m, most likely from Alstom or Siemens, which together provided the Eurostar fleet, representing half of a required £1bn in launch funding. Sir Richard would take a major equity stake, supported by a partner or partners.
While inactive on the UK rail network since 2019, Virgin Trains was credited with bringing airline-style flair to the West Coast route between London and Scotland following its privatisation in the late 1990s.
The current West Coast contract is run by Trenitalia with FirstGroup and ranked as Britain's worst train service for punctuality and the second worst for cancellations in the first quarter, according to the most recent ORR figures.
While Eurostar itself said it will also stake a claim to the spare capacity at Temple Mills depot in east London, the ORR is expected to favour an end to its 31-year monopoly over passenger express services between Britain and the Continent.
In a letter to bidders, the regulator asked them to present final submissions 'at pace' in order to allow it to make a decision on awarding the routes by the end of October.
However, it cautioned that applicants must submit detailed plans on the allocation of depot capacity and said that they were free to work together on alternative solutions for providing maintenance.
Eurostar, which connects London with Paris, Lille, Brussels, Rotterdam, Amsterdam and the French Alps, said it is still of the view that Temple Mills is too full to accommodate a new entrant, with the one and a half servicing lanes available sufficient for five trains at most.
The company, owned by French state railway SCNF, said the only workable solution may be to build a second UK depot and that there a number of suitable sites available, including one at Stratford, close to Temple Mills.
While construction costs would most likely exceed £100m, a spokesman said it would be open to collaborating with a potential rival to share the cost.
Eurostar operates a fleet of around 20 trains from St Pancras but plans to place an order for up to 50 more as early as this year, to be split between its Channel Tunnel routes and a Paris-to-Brussels service.
The spokesman said: 'It's clear a strategic, joined-up approach is needed to unlock the full potential of international rail for passengers and the UK economy.'