FirstGroup plc announces that it has completed the acquisition of Grand Union Trains GWML Holdings Limited which holds track access rights for a new open access rail service between Carmarthen and London Paddington. The Group has also today submitted an application to the Office of Rail and Road (ORR) to expand this service with additional paths to Paignton, Devon.
The new service between London Paddington and Carmarthen is anticipated to be introduced in December 2027 and run to at least the end of 2037.
Following mobilisation in 2027, the Group expects the service to contribute annual revenues of c. GBP 50 million after two years, with a low double digit operating margin. A further open access application has been submitted to the ORR for this service to incorporate an additional five return trips per day between London Paddington and Paignton.
Carmarthen – London Paddington open access rail service
The Group’s acquisition of Grand Union Trains GWML Holdings Limited includes its subsidiary Grand Union Trains No. 2 Limited which holds track access rights already granted by the ORR to run open access rail services between London Paddington and Carmarthen from December 2027, for a period of ten years.
The new service will comprise five services a day between London Paddington and Carmarthen, calling at intermediate stations in England and Wales including Bristol Parkway, Newport, Severn Tunnel Junction, Cardiff Central, Gowerton and Llanelli. Passengers can look forward to low fares on the c.400m annual seat miles, with free Wi-Fi and on-board catering, all offered in one comfortable class of travel. The service will provide the first direct service to London from Severn Tunnel Junction and Gowerton, and a vastly improved connection from Llanelli.
It will be operated under the Group’s successful Lumo brand.
Following mobilisation in 2027, the Group expects the service to contribute annual revenues of c.GBP 50 million after two years, with a low double digit operating margin, pre IFRS 16. The new service is expected to create around 100 direct jobs.
The Group is currently considering rolling stock options and further updates will be provided in due course.
Together with the Group’s recently announced acquisition of the track access rights granted by the ORR to run a new open access rail service from London Euston to Stirling, this will more than double FirstGroup’s open access capacity in the next few years. Furthermore, should the Group’s recently submitted applications be approved by the ORR this would almost treble the Group’s open access capacity over time.
Paignton – London expansion
FirstGroup has also submitted an application to the ORR for track access rights to expand the new operation to include five return Lumo services between London Paddington and Paignton via stations including Bath Spa, Bristol Temple Meads, Taunton, Exeter St David’s and Torquay from May 2028, as well as a sixth path between Highbridge & Burnham and London.
Currently the Torbay area only has three direct rail services to London a day, and rail only has a 29% modal share on this route compared to 71% for road. This is despite a car journey from Paignton to London taking between four and five hours on average; the Group’s planned London-Paignton service will take around 3 hours 20 minutes. Similarly, Bath and Bristol tourist rail journeys to Torbay have a lower modal share than comparable routes.
“Growing our open access rail portfolio is a key priority for FirstGroup. The introduction of our new Carmarthen to London Paddington service will significantly bolster our footprint, and should our other applications be successful, we will almost treble our current open access capacity over the next few years. Our successful investment in open access through Lumo and Hull Trains has helped connect communities and drive economic growth and we aim to help spur similar effects along this route,” FirstGroup Chief Executive Officer, Graham Sutherland said.
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