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The UK Rail Market 2012

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The UK Rail Market 2012 Brooks Market Intelligence Reports, part of Mack Brooks Exhibitions Ltd www.brooksreports.com Mack Brooks Exhibitions Ltd © 2012. All rights reserved. No guarantee can be given as to the correctness and/or completeness of the information provided in this document. Users are recommended to verify the reliability of the statements made before making any decisions based on them. CONTENTS Introduction 5 1. Government 6 The McNulty Report 6 Scotland and Wales 7 Regulation 8 Control Period 5 (2014-19) (CP5) 8 Passenger Transport Executives 10 Community rail partnerships 10 Rail decentralisation 11 2. Main Line Railway Infrastructure 12 Network Rail 12 Organisation 12 Alliances 12 Network Rail Infrastructure Projects 13 Network Rail Consulting 13 Route Utilisation Strategies (RUSs) 13 Long Term Planning Process 13 Control Period 4 (2009-14) (CP4) 14 Enhancement projects 16 Electrification 17 Other projects 19 Network Rail Procurement 21 Annual Report 21 High-speed Lines 22 High Speed 1 (Channel Tunnel Rail Link) 22 High Speed 2 23 3. Main Line Train Operating Companies 25 The passenger franchise structure 25 Background 25 Franchised passenger operators: status as at October 2012 26 Open access passenger operators 29 Franchise-holding groups/train operating parent companies 31 Rail freight operators 33 Mack Brooks Exhibitions Ltd © 2012 2 4. Rolling Stock Procurement 36 Passenger vehicles 36 Freight vehicles 39 5. Rolling Stock Leasing Companies 41 6. Railways in Northern Ireland 43 Government 43 NI Railways 43 Organisation 43 Developments 44 7. Transport for London (TfL) 45 Organisation 45 London Underground 47 Organisation 47 LUL Nominee BCV Ltd/LUL Nominee SSL Ltd (Metronet Rail) 47 Tube Lines Ltd 49 Capital expenditure plans (LUL) 50 London Overground 50 Organisation 51 East London Line (ELL) Extension 51 Future aspirations 52 Capital expenditure plans (London Overground) 52 Docklands Light Railway 52 Organisation 52 Development plans 53 Capital expenditure plans (DLR) 53 Crossrail 54 8. Light Rail and Light Metros 56 Blackpool 56 Edinburgh Tram 57 Glasgow Subway 57 London Tramlink 58 Manchester Metrolink 58 Midland Metro (Birmingham/Wolverhampton) 59 Mack Brooks Exhibitions Ltd © 2012 3 Nottingham Express Transit (NET) 60 Sheffield: Stagecoach Supertram 60 Sheffield-Rotherham tram-train pilot project 61 Tyne & Wear Metro 62 9. The Railway Supply Industry 62 Rolling stock, rolling stock components and subsystems 62 Vehicle maintenance equipment and services/refurbishment 63 Revenue collection, access control, passenger information systems 64 and station equipment Track products 65 Track maintenance and renewals equipment and products 66 Track maintenance and renewals services 68 Signalling and communications systems 68 Traction power supply and electrification systems 69 Civil engineering and construction/infrastructure maintenance 70 Mack Brooks Exhibitions Ltd © 2012 4 Introduction Passenger numbers using the main line railway system in Great Britain hit a new post- war record of 1,460 million in 2011-12, up nearly 8 per cent on the previous year. This enables the network to retain its claim to be the fastest growing in Europe. Further significant growth is expected as the country’s population increases, and rising fuel prices and environmental concerns influence transport modal choices. Rail freight has recovered strongly during a difficult economic environment, recording an increase of 13 per cent in tonnage lifted to 101.7 million tonnes and a 10 per cent rise in tonne-km. An increase in freight volumes of 30 per cent is still foreseen over the next decade, with strong growth in intermodal traffic expected to offset a reduction in coal movements in reaction to changes in power generation policies. Both the previous and current governments proved friendly to rail, sanctioning major infrastructure projects on a scale not seen in recent times. Providing capacity for anticipated increases in traffic remains the key driver for future investment in rail in the UK. In London, tunnelling is now well under way on the £14.6 billion cross-city Crossrail line, one of the largest rail construction projects in Europe. Coupled with the £6 billion Thameslink scheme and the ongoing upgrade of the London Underground network, rail development activity in the capital is a major source of business for the industry’s suppliers. More recently, approval has been given for several significant main line electrification schemes, setting in motion a process that will see more routes similarly treated in future years. The current government has also confirmed its determination to press ahead with a high- speed rail network linking South East England initially with the West Midlands and later with Leeds and Manchester. And investments are being made to increase the size and quality of the rolling stock fleet. In the urban rail sector, the Tyne & Wear Metro is undergoing extensive modernisation and a major expansion of Manchester’s light rail network is in progress. Work continues on Edinburgh’s first light rail line and approval has been given to expand the Midland Metro and Nottingham networks. Also approved is a pilot scheme to evaluate the benefits of tram-train technology between Sheffield and Rotherham. However, the industry is being challenged to bring down its costs to network users and taxpayers. The results of its efforts will be evident in the settlement covering levels of investment in Britain’s main line railway infrastructure for the five-year period from April 2014, known as CP5. This will be finalised in 2013 but is unlikely to detract from the very bright future ahead of railways in Great Britain. October 2012 Mack Brooks Exhibitions Ltd © 2012 5 1. Government The Government, via the Department for Transport’s Rail Group ( www.dft.gov.uk ), sets overall strategic policy for the national railway network and ensures the cost-effective and timely delivery of major rail projects. It is also responsible for awarding most passenger franchises in England, although there are some exceptions (see Section 3 ). In November 2010, following the General Election in May, the DfT published its first annual Business Plan for the four-year period from 2011 to 2015. Revised annually, the current version of the Business Plan is accessible at: http://assets.dft.gov.uk/publications/business-plan-2011-2015/dft-2012-business-plan.pdf As well as affirming the Coalition Government’s support for the development of a high- speed rail system (Section 2), delivery of a sustainable and customer-focused railway including major capacity enhancements such as Crossrail and electrification, and the continuing upgrading of the London Underground network (Section 7), the plan provides for the development of proposals that will result in significant changes to the structure of the railway in Great Britain: • A new passenger franchise strategy as outlined in a Written Statement by the Secretary of State in August 2011: http://www.dft.gov.uk/news/statements/hammond-20110805 • Proposals to reform the role of the rail regulator to create a more unified regulatory structure, and proposals for rail decentralisation. The McNulty Report May 2011 saw publication of an independent value for money review of the rail network by Sir Roy McNulty, commissioned by the previous government. Entitled ‘Realising the Potential of GB Rail’, this identified the potential for annual savings of up to £1 billion in the operation of Britain’s rail network without cutting services. Providing opportunities to limit fare rises and reduce the need for government subsidies, the report was expected to inform future rail policy. The report and associated documents can be accessed at: http://www.dft.gov.uk/publications/realising-the-potential-of-gb-rail/ An early response to the McNulty report was the establishment in May 2011 of the Rail Delivery Group (RDG), composed of senior industry figures including the chief executives of the passenger and freight train operating owning groups and Network Rail. The group was to focus on industry-wide issues, including strategy and long-term vision for the railway. It was tasked with seeking to inform key choices facing government and the development of plans in response to governments' output specifications. It was also to consider and implement recommendations in the McNulty report, and it steered and took Mack Brooks Exhibitions Ltd © 2012 6 ownership of the Initial Industry Plans (IIPs) (see Regulation below), published in September 2011 as part of the regulatory review process. In 2012 the RDG decided that it should cease operating on a voluntary basis and instead that it should be formalised by creating a company limited by guarantee. An obligation is to be placed on key industry organisations to participate in the RDG by the introduction of a licence condition requiring participation in it. Scotland and Wales The Railways Act 2005 vested certain devolved powers in the Scottish Executive, providing it with authority both to promote new projects and to specify and fund passenger-related network and infrastructure enhancements. Implementation of projects is undertaken by Transport Scotland ( www.transportscotland.gov.uk ), the Scottish Executive’s national transport agency. It also awards and oversees the franchise for passenger rail services in Scotland. In December 2008 Transport Scotland published its Strategic Transport Projects Review (STPR), which set out to define the most appropriate strategic investments in Scotland’s national
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