Abellio UK

Description of the UK rail market

The UK rail market has operated under a franchised system since privatisation in the 1990s. Under this system, the UK government and devolved authorities award contracts to private operators to run train operating companies (TOCs) for a specified period of time. The majority of the UK’s 17 rail franchises are contracted by the Department for Transport and they have a combined turnover of approximately £10.5 billion.

TOCs work in partnership with Network Rail, the state owned infrastructure manager, to run their day-to-day operations, in a private-public partnership. This is especially so in the case of ScotRail, which is run in an Alliance agreement with Network Rail. This means that the management teams are co- located and work together to deliver the best possible service for passengers.

Abellio UK rail and bus franchises

From north to south, Abellio UK operates the ScotRail franchise, the Merseyrail franchise in a 50/50 joint venture with Serco and the Greater Anglia rail franchise in a 60/40 corporation with Mitsui. Since 10 December 2017 Abellio UK also operates West Midlands Railway and London Northwestern Railway in a 70/30 corporation with Mitsui and East Japan Railway Company (JR East). In addition, Abellio UK operates Abellio UK Bus, which provides bus services in the centre, south and west of London, as well as a few routes in the north of Surrey (Abellio London Bus). The bus operations provides complementary travel expertise, especially in the form of rail replacement services to the rail franchises (Abellio Rail Replacement).

Key figures per UK rail franchise and bus company, excl. West Midlands franchise as they joined in December 2017

Operational KPIs 2017

Revenue in euros

Customer
Satisfaction

Punctuality

SPADs

CO2 emissions

LTIFR*

No. stations

No. train sets/

buses

Greater Anglia

736.7M

81%

89.40%

9

33 g per passenger-km

6.3

130

1055

ScotRail

769.1M

85%

90.40%

19

62 g per passenger-km

5.3

357

805

Merseyrail

87M**

89%

95.30%

2

42 g per passenger-km

4.6

59

177

Abellio London Bus

216.7M

N/A

N/A

N/A

1 g per bus-km

4.1

N/A

751

  • *number of LTIs per million hours worked
  • **this is 100%. Merseyrail is not consolidated as it is operated in a 50/50 JV

2017 Overview

2017 has been a year of growth for Abellio UK. The most notable achievement saw Abellio UK awarded the West Midlands franchise in a 70/30 corporation with JR East and Mitsui, giving Abellio UK the strongest portfolio of contracts since it began operating in 2002. Abellio UK is now the fourth largest rail operator in the UK and also runs a bus company.

In 2017 Abellio achieved a turnover of €1.7 billion and the next potential contract expiry will not come until 2022, which is the first possible expiry of ScotRail. As at the end of 2017, Abellio UK operates over 2,500 train vehicles and moves over 800,000 passengers every day. In terms of performance (measured in the UK using the Public Performance Measure (PPM)) our UK rail franchises are in the top 14 for UK operators (out of 23). PPM monitors the percentage of trains that have arrived at their final destination within five minutes of their scheduled time – having stopped at all scheduled stations. The following table[1] shows the PPM for 2017 and number of trains running per day per franchise:

 

Train operator

PPM

Trains per day

1

c2c

95.9%

400

2

Merseyrail

95.3%

614

3

LOROL

94.6%

1356

4

TfL Rail

94.1%

267

5

Chiltern

92.9%

432

6

East Midland Trains

92.7%

476

7

ScotRail

90.4%

2296

8

Heathrow Express

90.3%

144

9

Arriva Trains Wales

89.5%

982

10

Greater Anglia

89.4%

1308

11

Northern

89.2%

2608

12

CrossCountry

88.8%

297

13

South Eastern

88.7%

2002

14

West Midland Trains

88.3%

1295

15

TPE

87.7%

240

16

Caledonian Sleeper

87.3%

3

17

Great Western

87.0%

1593

18

Virgin West Coast

86.0%

298

19

Grand Central

85.8%

18

20

South West

85.8%

1749

21

GTR

90.8%

3514

22

Virgin East Coast

84.5%

154

23

Hull Trains

79.8%

14

  • 1This table shows performance of UK’s 23 operating companies.17 of these operations are franchised by either DfT or Transport Scotland. Hull Trains, Heathrow Express, Grand Central are “open access” operators while Merseyrail, LOROL and TFL Rail are public sector operated concessions.

Abellio UK is a major UK employer, with over 13,000 employees across its businesses, including Merseyrail. Two of our UK rail franchises have been affected by industrial action this year. The dispute, which affects also other train operating companies across United Kingdom, is over the implementation of new trains that have either driver operated or controlled doors with the National Union of Rail, Martime and Transport Workers (RMT) wanting guards to open and close the doors, rather than the driver. Abellio UK is working closely with its employees and all affected stakeholders to reach a sustainable resolution.

Outlook for 2018

Abellio UK continues to pursue opportunities to expand its business mostly in cooperation with bidding partners. Abellio UK is prequalified to bid for the Southeastern franchise and the East Midlands franchise in 2018. End of December 2017 Abellio UK submitted a bid to operate the Wales and Borders franchise, in cooperation with Carillion and Aecom. Following the liquidation of Carillion in January, Abellio has taken the decision to withdraw from the contract letting process for the Wales and Borders franchise. Outside of bidding, we are looking at ways to maximise the efficiency of existing contracts while we aim to remain in the top of the league in the UK in terms of performance and PPM. Our investment in our businesses will improve customer journeys and the franchises we operate by providing over 200,000 more seats and faster journey times.

Organisation and staff

Abellio UK’s head office is based in Glasgow with a subsidiary office in London. This consists of a number of subject-matter experts as well as a specialist business development team. We believe in a philosophy of empowering our people to run the best businesses they can, led and supported by our top teams. Our mid-term strategy seeks to better lead, prepare, support and communicate with all of our people.