FARE HIKES AND FIRSTGROUP FRANCHISES - WHAT DOES THIS ALL MEAN FOR BUSINESS TRAVEL?

All eyes were on the rail industry this week following two massive announcements, starting with a proposed 6.2% increase in rail fares and followed by the news that Virgin Trains has lost its West Coast main line operating contract, which it had held since 1997, after being outbid by FirstGroup. FirstGroup is the UK’s largest train operator and it is believed to have bid as much around £5.5bn for the rail franchise.

The company, under the name First West Coast Limited, will take over the franchise from 9 December and is due to operate the service until 2026. The West Coast main line is a lucrative business proposition, having experienced a surge in passenger numbers from 13m to 31m in the last 15 years.

FirstGroup says it will introduce 11 new 125mph six-car electric trains on the Birmingham-to-Glasgow route and provide more direct services between destinations. It’s also promised to add a further 40,000 seats a day on West Coast routes from 2016.

But what does all this mean for the business traveller and business travel buyer? After all, Virgin Trains has done an excellent job of attracting and retaining business travel customers during its 15-year West Coast reign.

If FirstGroup keeps its promises and really does increase direct services and capacity, then this is only good news for the business traveller reducing both journey times and disruptions. And, as FirstGroup owns a substantial chunk of the UK rail network then maybe, just maybe, there will be an opportunity for business travel buyers to negotiate volume discounts for the first time, which may well help to offset those rather steep fare increases.

Of course, it’s very early days, but let’s hope that FirstGroup bears the business traveller in mind when rolling out its franchise strategy in a few months time.

David Chapple is event director of the Business Travel Show. Commuting to central London from the Home Counties each day, he’s a bit of an expert on rail travel. Challenge him on Twitter @btshowlondon.