Stagecoach says it has overpaid for East Coast rail contract as profitability plunges

Stagecoach says it has overpaid for East Coast rail contract as profitability plunges

Brexit and terrorism meant franchise will ‘have to be reset’, says third private operator of London to Edinburgh line in 11 years

The London-to-Edinburgh rail line is facing its third crisis of private ownership in 11 years after Stagecoach clashed with the government over the terms of its East Coast franchise. Stagecoach has also admitted that in hindsight it overpaid for the £3.3bn contract, blaming factors including Brexit and terrorism for underperformance that punched an £84m hole in its finances.

The difficulties facing Virgin East Coast, 90% owned by Stagecoach and 10% by Virgin, prompted renewed calls for nationalisation of the railways.

Related: East coast mainline: profitable and publicly owned – so why sell it?

Related: How workable – and how expensive – might Labour’s renationalisations be?

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Source: Guardian Transport

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