Branson downbeat on Virgin Trains future after losing last franchise
The future of the Virgin Trains brand looks uncertain after it lost its remaining franchise this morning to rival FirstGroup and Virgin founder Sir Richard Branson cast doubt on whether it would bid for any more rail lines.
Virgin Trains: has lost the West Coast line franchise to rival FirstGroup
Branson took the Virgin brand into rail in 1997, winning the West Coast franchise, which was today (15 August) awarded by the Government to FirstGroup for 13 years and four months, with an option to be extended to 15 years.
First West Coast will take over from Virgin Trains on 9 December, having outbid Virgin with a pledge to pay the Government £5.5bn to run the franchise.
Bids were also submitted by two other parties, Abellio InterCity West Coast Limited – NV Nederlandse Spoorwegen, and Keolis / SNCF West Coast Limited.
In a carefully-worded statement, Branson cast doubt on whether Virgin would bid for another franchise, criticising the Government's track record on awarding tenders to the highest bidder.
He said: "Based on the current flawed system, it is extremely unlikely that we would bid again for a franchise.
"We have made realistic offers for the East Coast twice before, which were rejected by the Department for Transport for completely unrealistic ones and therefore will have to think hard before embarking on another bid.
"This is the fourth time that we have been out-bid in a rail tender. On the past three occasions, the winning operator has come nowhere close to delivering their promised plans and revenue, and has let the public and country down dramatically."
However, a Virgin Trains spokesman claimed it was still possible the company would bid for another franchise, citing the East Coast mainline.
This line is expected to be tendered in January 2013, according to the Department for Transport. It is in temporary Government hands after the state took the franchise back from National Express in 2009.
The Virgin Trains spokesman said it was too early to comment on the future of the brand's marketing department, which is around 20 strong and is led by Annerie Hughes as head of marketing.
The brand works with advertising agency Dare and promotional agency Elvis.
Branson claimed that over the 15 years Virgin has run the West Coast franchise, passenger numbers have more than doubled to 30 million.Follow @DanFareyJones
This article was first published on marketingmagazine.co.uk
Latest jobs Jobs web feed
- senior planner > SPORTS BRANDS collectivo Up to £90,000 plus benefits, London
- Head of Media, Marketing & Communications PGA Competitive, Sutton Coldfield, West Midlands
- Account Director- Exciting Online Content Marketing Company- Up to £70,000 plus OTE Cedar Scott Up to £70,000 basic (up to £90,000 OTE) plus share options, Central London
- ACCOUNT DIRECTOR/SENIOR ACCOUNT DIRECTOR - BTL/SP/Brand Experience - London - £45 - £55k plus bonus Judi Patton £45K-55K plus bonus, London/Greater London
- Senior Planning Director, International Agency, London, to £120k Fill Recruitment Ltd to £120,000, Central London
- Head of Customer Analytics - Consultancy Harnham £90000 - £100000 per annum + benefits, London
Integrated digital marketing offers huge opportunities to engage, servic...
Mobile marketing is coming of age, and the pace of change is now exponen...
With UK consumers spending an average of £1,083 a year online, int...
Conversational Mobile Marketing: Engage Customers and Empower Advocates (Expert Reports) External website
The pressure is on for marketers and mobile operators to embrace a strat...
As a nation, the UK is media and technology obsessed with over half of t...
All customers have the potential to become your brand advocates, driving...