TRANSPORT giant Arriva hopes to turn around loss-making rail firm Grand Central after buying the operator of services between Sunderland and London.
Sunderland train and bus company Arriva ended weeks of industry speculation on the future of the York-based firm by announcing its purchase yesterday for an undisclosed sum.
It says it will keep on Grand Central’s 123 staff and build the business which runs 700,000 passenger journeys a year on its main service linking Sunderland, Hartlepool, Eaglescliffe and London and another service between Bradford and London.
It aims to improve marketing and operational efficiency at the company which in the 12 months to March 31, 2011 saw its turnover grow to £18.9m from £11.5m a year earlier, but still owed £44m.
As an open access operator, Grand Central is an independent business which does not receive subsidy from, or pay any premium to, the Department for Transport.
Arriva launched its open access service development arm Alliance Rail 18 months ago to investigate running more services in West Yorkshire, but the company said there were no plans to bring these businesses together beyond sharing expertise. Bob Holland, Arriva UK Trains managing director, said: “We firmly believe open access will play a valuable part of a balanced portfolio for our UK Trains division alongside our three franchises and concessions operated on London Overground and the Tyne and Wear Metro.
“Bringing Grand Central on board means we have a live open access operation up-and-running, one which is popular with customers and which we believe we can develop to be a key commercial part of our UK rail operations.”
Tom Clift, managing director of Grand Central, said the company would remain a self-contained business with its own brand and identity.
He added: “The decision by Arriva, one of Europe’s largest transport undertakings, to acquire Grand Central is a huge vote of confidence in all our staff who have worked so hard over the last four years to deliver the very highest standards of customer service to the growing numbers of passengers using our routes. I will continue to lead Grand Central and will report directly into Bob Holland, MD of Arriva’s UK Trains division.”
The deal means Arriva controls Grand Central, as well as the CrossCountry, Arriva Trains Wales and Chiltern Railways franchises, plus concessions to run Tyne and Wear Metro and London Overground.
The London concession is a joint venture with Hong Kong-based operator MTR. Arriva UK is owned by German company Deutsche Bahn and runs all its services outside its homeland.