Perth-based Stagecoach has held the South West Trains franchise – which operates between London Waterloo, Reading, Bristol, Exeter, Weymouth and Portsmouth – since 1996. The contract also includes the Island Line on the Isle of Wight.
The UK Department for Transport (DfT) said the new operator is due to take over the franchise in June 2017, and the two bidders will “need to demonstrate how they will deliver better journeys for passengers”.
Stagecoach, which faces a battle against Aberdeen-based rival FirstGroup to retain the route, said about 14 per cent of all passenger journeys in the UK are made on the South Western network, which sees almost 1,700 trains serve more than 200 stations each day.
Chief executive Martin Griffiths said: “We are proud to have been trusted to run the South Western network for the past 20 years. The continuity of one operator understanding and serving passengers and local communities has been key, helping transform the network and attract millions of new customers to rail travel.
“But more work needs to be done. The next franchise requires a transport operator which fully understands this complex network, grasps the massive challenges ahead, and has a track-record of delivery and working effectively with industry partners. Our experience means we are well placed to see that job through.”
First Rail managing director Steve Montgomery said the group, which used to hold the ScotRail francise, has “extensive experience” of running commuter, regional and long-distance services and a “strong track record” in growing passenger numbers.
He added: “The South Western franchise plays a crucial role in keeping people moving and communities prospering across the region. We are developing an innovative and value for money proposal that will deliver better connectivity and significant improvements for customers. We look forward to the publication of further details by the DfT.”
The DfT is yet to confirm the length of the new contract. A consultation with passengers, businesses and local councils on the specification for the franchise runs until Tuesday.
Rail minister Claire Perry said: “The South Western franchise has some of the busiest routes in the country, serving a diverse range of passengers and places. It is vital that we have the best partner to help us meet the challenge of delivering better journeys for all customers using these services.
“We are investing in additional capacity, and have ambitious plans for smart ticketing, customer service and improved connectivity across the South Western network, to give passengers real benefits across the region and beyond.”