Final day for Virgin Trains East Coast following franchise failure
Trains on the route will be brought back under public control from Sunday, with the London North Eastern Railway (LNER) brand being resurrected from the 1940s.
The East Coast route connects London King’s Cross to stations in the North and Scotland including York, Leeds, Newcastle, Edinburgh, Aberdeen and Inverness.
VTEC, a joint venture between Stagecoach (90%) and Virgin (10%), began operating in March 2015.
The firms agreed to pay the Government £3.3 billion to run trains until 2023, but the contract was ended prematurely after they failed to achieve revenue targets.
Stagecoach lost around £200 million over the course of the contract.
Transport Secretary Chris Grayling refuted accusations from Labour and trade unions that his decision to end the deal early was a “bailout” worth £2 billion.
“Stagecoach will be held to all of its contractual obligations in full,” the minister said.
VTEC managing director David Horne has been appointed to the same role at LNER. All VTEC staff will transfer to the new franchise.
VTEC did report a 5% growth in passenger numbers in recent months, building on the 21.8 million journeys taken in 2017/18, up 1.3 million from when the franchise began.
Stagecoach chief executive Martin Griffiths said: “Our people can be fiercely proud of everything they’ve achieved: from delivering huge investment and high levels of customer satisfaction, to providing new services and benefits for passengers and creating hundreds of new jobs.
“The growth we’re now seeing proves our initiatives are paying off and the railway we hand over to LNER is not only better than we inherited, but one that has been positively transformed for customers and ready to continue our journey of improvement with the introduction of the new Azuma train fleet from December.”
Mr Grayling has not placed restrictions on Stagecoach or Virgin’s ability to bid for future franchises, stating that “there is no suggestion of either malpractice or malicious intent”.
VTEC is the third private operator to fail to complete the full length of a contract to run East Coast services.
GNER was stripped of the route in 2007 after its parent company suffered financial difficulties, while National Express withdrew in 2009.
Trains were run by the DfT for six years up to VTEC taking over.
Passengers are being assured that the transition to LNER will be smooth, with tickets, timetables and trains staying the same.
The first LNER train will be the 7.54am departure from Newcastle to London King’s Cross on Sunday.