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InterCity East Coast

LNER 800105 at London King's Cross in 2019
Current operator	London North Eastern Railway
Main Route(s)	East Coast Main Line
Fleet	7 InterCity 225 sets 23 Class 800 Azuma sets 42 Class 801 Azuma sets
Stations called at	53
Dates of operation	28 Apr 1996 – 8 Dec 2007 9 Dec 2007 – 13 Nov 2009 14 Nov 2009 – 28 Feb 2015 1 Mar 2015 – 23 Jun 2018 24 Jun 2018 – onwards
Technical
Track gauge	1,435 mm (4 ft 8+1⁄2 in)
Length	632 kilometres (393 mi)
Operating speed	125 mph
Other
Website	www.gov.uk/government/collections/rail-franchising#intercity-east-coast-franchise

v t e London North Eastern Railway
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InterCity East Coast is a railway franchise for passenger trains on the East Coast Main Line in the United Kingdom from London King's Cross to Hull, Leeds, Bradford, Harrogate, Newcastle, Edinburgh, Glasgow, Inverness and Aberdeen. It was formed during the privatisation of British Rail and transferred to the private sector in April 1996.

Initially operated by Great North Eastern Railway (GNER), it was later operated by National Express East Coast, East Coast and Virgin Trains East Coast. In June 2018 the franchise was terminated and the trains and stations taken back into public ownership; since then, services are provided by London North Eastern Railway (LNER), a company owned by the Department for Transport.

History

Great North Eastern Railway

In April 1996, Sea Containers, operating under the GNER brand, commenced a seven-year contract to operate the franchise.

In March 2000, the Shadow Strategic Rail Authority (SRA) shortlisted Sea Containers and Virgin Rail Group to bid for the next franchise. The franchise was to be for 20 years and included proposals for new trains and replacements of sections of track. In January 2002, the SRA scrapped the refranchising process and awarded a two-year extension to Sea Containers until April 2005.

In October 2004, the SRA issued an Invitation to Tender for the next franchise to the four shortlisted bidders, Danish State Railways/English Welsh & Scottish, FirstGroup, GNER and Virgin Rail Group. In March 2005, the franchise was awarded to GNER for seven years, with a three-year extension based on targets being met, starting on 1 May 2005. GNER committed to pay a £1.3 billion premium to the Department for Transport (DfT) over ten years.

However, due to the financial problems caused by it having overbid as well as financial difficulties encountered by the parent company, in December 2006 the government announced it was stripping the franchise from Sea Containers and would put it up for re-tender, with GNER running the franchise on fixed fee management contract in the interim.

National Express East Coast

In February 2007, the DfT announced Arriva, FirstGroup, National Express and Virgin Rail Group had been shortlisted to lodge bids for the franchise. In April 2007, it was announced that GNER had a 10% stake in the Virgin Rail Group bid. In August 2007 the franchise was awarded to National Express, and GNER's services transferred to National Express East Coast (NXEC) on 9 December 2007.

By 2009, NXEC was under increasing financial pressure due to rising fuel prices and the economic downturn. Instead of projected increases in revenue from the franchise, in the first half of 2009 NXEC ticket sales income decreased by 1%. In April 2009, National Express confirmed that it was still pursuing talks with the government over possible financial assistance with the franchise, either through a reduction in the premium due, or other assistance.

In July 2009, National Express announced it planned to default on the franchise, having failed to renegotiate the contractual terms of operation, and would not provide any further funding. This meant NXEC would run out of cash by the end of 2009. As a result, the DfT announced it would re-nationalise the franchise.

East Coast Main Line Company

The franchise was re-nationalised on 14 November 2009 with Directly Operated Railways' subsidiary East Coast taking over, with the intention being that operations would return to a private franchisee by December 2013. In March 2013, the Secretary of State for Transport announced that this would be put back to February 2015.

Virgin Trains East Coast

In January 2014, FirstGroup, Keolis/Eurostar International Limited (EIL) and Stagecoach/Virgin were announced as the shortlisted bidders for the new franchise. In November 2014, the franchise was awarded to Stagecoach/Virgin, who – trading as Virgin Trains East Coast (VTEC) – commenced operating the franchise on 1 March 2015.

In November 2017, Secretary of State for Transport Chris Grayling announced the early termination of the East Coast franchise in 2020, three years ahead of schedule, following losses on the route by the operator. Virgin Trains East Coast had been due to pay more than £2 billion in franchise premiums to the government over the last four years of its contract.

Secretary Grayling said the losses were due to VTEC overestimating future growth in passenger revenue in its bid calculations, meaning franchise payments due to the government exceeded the profits being returned by running the services. Others pointed to the delays in state-owned Network Rail's delivery of expected infrastructure upgrades, which meant the company could not operate the increased number of services needed to generate this increased revenue.

Termination was brought forward in February 2018 to June 2018.

London North Eastern Railway

On 16 May 2018, Secretary of State for Transport Chris Grayling announced the franchise would be terminated on 24 June 2018 and renationalised. A partnership of Arup Group, Ernst & Young, and SNC-Lavalin Rail & Transit provided assistance to the government in their preparation to take control of the franchise from VTEC. Services are operated by LNER, which is owned by DfT Operator, a wholly-owned subsidiary of the Department of Transport.

Rolling stock

At inception, the franchise inherited and operated a fleet of InterCity 125 and InterCity 225 trains. These were refurbished with new interiors in the mid-2000s; the former were retired in December 2019, and the latter were due to be retired in 2020, all to be replaced by Class 800/801s. It was announced in February 2020 that LNER would retain a number of Class 91s and Mk 4s to enable it to meet December 2021 timetable requirements.

References

1. "Sea Containers wins East Coast Main Line franchise". Rail. No. 276. Peterborough: Bauer Media Group. 10 April 1996. p. 10.
2. Six Companies Shortlisted for First Franchise Replacement Round Shadow Strategic Rail Authority 14 March 2000
3. "Virgin plans new £6bn East Coast high-speed main line". Rail. No. 378. Peterborough: Bauer Media Group. 8 March 2000. p. 4.
4. "GNER's 20-year franchise proposals for the ECML". Rail. No. 378. Peterborough: Bauer Media Group. 8 March 2000. p. 7.
5. "High-speed GNER trains scrapped". BBC News. BBC. 16 January 2002. Retrieved 3 February 2018.
6. GNER Franchise Extended to 2005 Sea Containers 16 January 2002
7. "Rail News Snippets". Railwatch. Railfuture. 11 October 2004. Archived from the original on 4 March 2016.
8. "GNER wins second franchise term". Railway Gazette International. Sutton: DVV Media Group. 1 May 2005. Archived from the original on 20 November 2018. Retrieved 3 February 2018.
9. "GNER pays £1.3bn for East Coast franchise". The Daily Telegraph. London. 22 March 2005. Retrieved 3 February 2018.
10. Osborne, Alistair (23 March 2005). "GNER's blockbuster bid clinches East Coast Line". The Daily Telegraph. London. Retrieved 3 February 2018.
11. "GNER owner makes Chapter 11 move". BBC News. BBC. 16 October 2006. Retrieved 3 February 2018.
12. "GNER to surrender top train route". BBC News. BBC. 15 December 2006. Retrieved 3 February 2018.
13. "Four in East Coast rail shortlist". BBC News. BBC. 20 February 2007. Retrieved 3 February 2018.
14. "GNER in joint bid for top route". BBC News. BBC. 6 April 2007. Retrieved 3 February 2018.
15. National Express awarded contract for growth on InterCity East Coast Department for Transport 14 August 2007
16. "National Express wins rail route". BBC News. BBC. 14 August 2007. Retrieved 3 February 2018.
17. "Q&A: National Express and East Coast line". BBC News. BBC. 1 July 2009. Retrieved 3 February 2018.
18. Milo, Dan (3 May 2009). "National Express in talks over scrapping east coast franchise". The Guardian. London. Retrieved 2 December 2017.
19. "East Coast rail shortlist revealed". BBC News. BBC. 1 July 2009. Retrieved 3 February 2018.
20. National Express East Coast franchise Archived 18 July 2009 at the Wayback Machine Department for Transport 1 July 2009
21. Railway plan puts new focus on passengers Secretary of State for Transport 26 March 2013
22. "East Coast rail shortlist revealed". BBC News. BBC. 17 January 2014. Retrieved 3 February 2018.
23. "InterCity East Coast franchise shortlist announced". Railway Gazette International. Sutton: DVV Media Group. 17 January 2014. Archived from the original on 20 November 2018. Retrieved 3 February 2018.
24. More seats, more services and new trains for East Coast passengers Department for Transport 27 November 2014
25. "Stagecoach and Virgin win East Coast mainline rail franchise". BBC News. BBC. 27 November 2014. Retrieved 3 February 2018.
26. "£3.3bn premium wins East Coast franchise for Stagecoach and Virgin". Railway Gazette International. Sutton: DVV Media Group. 27 November 2014. Archived from the original on 8 December 2014. Retrieved 3 February 2018.
27. Elder, Bryce (29 November 2017). "Stagecoach soars after government intervenes on contract". Financial Times. London: Nikkei. Retrieved 2 December 2017.
28. Topham, Gwyn (29 November 2017). "East Coast rail 'bailout' could cost taxpayers hundreds of millions". The Guardian. London. Retrieved 2 December 2017.
29. "The inside track on East Coast mainline". BBC News. 12 February 2018. Retrieved 16 May 2018.
30. "Stagecoach to lose East Coast Mainline rail franchise". BBC News. 5 February 2018. Retrieved 5 February 2018.
31. "Stagecoach East Coast deal to end early". BBC News. 6 February 2018.
32. Virgin Trains East Coast franchise to end within months Archived 17 May 2018 at the Wayback Machine Railway Gazette International 6 February 2018
33. "Clarification of whether LNER is actually publicly owned". WhatDoTheyKnow. 2 July 2018. Retrieved 1 August 2022.
34. Government gives green light for more state-of-the-art intercity trains Department for Transport 18 July 2013

• East Coast Main Line
• Railway franchises in the United Kingdom