THE HEAD of a German-owned rail operator has said the Government should scrap costly rail franchises in favour of open competition.
Richard McClean, managing director at Grand Central Trains, said the contracts for the East Coast and West Coast routes had led to “unstable competitions which create businesses that are unstable in themselves”.
He said: “We’ve got to the stage where the intercity services are too big to sell, like on the West Cost, or too big to operate, as we’ve seen on the East Coast.”
The Government is preparing to name the successful bidder for the East Coast franchise in the coming weeks, after money woes led to two private-sector operators losing the valuable route in two years.
Mr McClean said allowing commercially-viable services to compete on InterCity routes would boost quality of service and lower ticket prices.
He said: “The intercity services are commercial businesses. Putting them into a contractual structure doesn’t gel well.”
Grand Central was launched in 2007, before becoming part of Deutsche Bahn’s Arriva Group in 2011. Its annual turnover is £32.7m.
It currently operates five daily return services from London to the North East and four from the capital to West Riding stations, such as Brighouse and Mirfield.