There’s a lot going on this month’s column, including the first bite at the Intercity Express Programme preferred bidder announcement. So let’s get straight into the fog of procurement.
First off in the smoke and mirrors department is the published version of the Invitation to Tender for the ‘accelerated’ DMUs, which included a break down of the 202 vehicles into batches. A batch of 11 four car units didn’t seem to correlate with anything in the Rolling Stock Plan.
Then, while I was grappling with my killer table of the 1300 new vehicles, another version of the
Yes, someone had been very naughty and issued a redacted official document without indicating the redactions. Fortunately Informed Sources readers will be able to find out who is getting what – with the usual proviso that everything is subject to the operators being able to make an acceptable business case within their existing franchise agreements.
And the 11 four cars? They would go to Portsmouth-Cardiff.
Meanwhile the bids for the 200 DMUs went in on 16 February. With Hyundai Rotem of
Many people, even Informed Sources readers, are still finding it hard to understand how I can find 1300 ‘new’ vehicles in DfT Rail’s Table of the 1300 ‘net additional vehicles’ in its Rolling Stock Plan, since the Table contains a mix of new and cascaded vehicles.
Yes, it is a difficult concept. But the key to understanding it lies in ‘net additional’. So to accompany the latest version of the Informed Sources Master Table I’ve had another go at explaining how the mix of new vehicles and cascades work.
But please let me know if you still have problems. My view has always been that if readers misunderstand, or find it hard to under stand what I have written it can only be one man’s fault!
To be frank, a column like Informed Sources thrives on turmoil and confusion. And, currently, rolling stock procurement is occupying a lot of my effort.
What we have to realise is that the Rolling Stock Plan is not a Plan but a sort of wiki with multiple inputs into what is a work in progress. For example, right out of the blue, on January 20 London Midland published a Notice in the Official Journal of the European Communities (OJEU) seeking funding for ‘between 44 and 100 EMU vehicles ’.
No OJEU had been published seeking bids to build these vehicles. Since, according to the OJEU, the new vehicles would have to work with LM’s existing Class 350 Siemens Desiros only more Desiros could do the job. And Desiros have just become very much more expensive.
So what is LM playing at? Well, my theory is that it is proposing to reverse the Class 323 cascade in the Rolling Stock Plan. Instead of Northern buying new EMUs and cascading its Class 323s to join the rest of the Class at LM, LM would by new EMUs and send its Class 323s to Northern.
But that is only a theory. And Northern have no idea what’s going on.
Meanwhile this month’s column includes an updated and (slightly) expanded version of the ‘1300 new vehicles’ Table. It includes the redacted allocations of the 200 DMU vehicles and we also say goodbye to the 24 vehicles proposed to lengthen TPEs Class 185s – our first ‘Project Cancelled’.
While the Table notionally covers the 1300 vehicles in the High Level Output Specification, I have been adding other orders, such as the London Overground EMUs and DMUs, which are not in the HLOS. Now the Table includes the Intercity Express Programme and Thameslink trains.
So if you like tables, this is the page for you, and there are lots of footnotes as well!
City pages in the national press have been full of reports by financial analysts predicting the failure of various passenger rail franchises with owning groups ‘handing back the key’. Appearing before the House of Commons Public Accounts Committee on 21 January, DfT Director General National Networks Dr Mike Mitchell was pressed on how the recession was affecting the TOCs. He agreed that ‘This is clearly a concern that we have’ but that revenue ‘appears to be holding up reasonably well’.
But on the Department’s ‘traffic light’ monitoring system for the TOCs, some operators are showing ‘red’. Pressed repeatedly Dr Mike eventually agreed to tell the Committee how many Red lights were showing in private after the public session.
To put this issue into context, this month’s column includes a Table of the additional money each
Within the 5%, some TOCs need a substantially higher increase and I have used this to rank the top five in the ‘pips squeaking league’.
However, and it is a very big ‘however’. It seems to me that the analysts may be overlooking the Cap & Collar revenue and risk sharing arrangement in franchise agreements. In the good times the taxpayer shares revenue above budget while in the bad times the taxpayer protects franchisees against revenue shortfall after the first 2% drop below budget.
Although the protecting collar, does not, in general, cut in until year five of a franchise some older franchises have a safety net and others have a reason to hang on in there. Although, as I explain, it’s a bit more complicated than that.
On 5 February Network Rail formally accepted ORR’s Determination for Control Period 4 (CP4). According to Chief Executive Iain Coucher this provides ‘unprecedented investment’ over the next five years.
But a fortnight earlier track renewal contractors had learned the price for Network Rail’s accepting the ‘ambitious savings to be made’. The volume of track renewals in the first year of the new control Period has been cut ‘by around 25%’. Network Rail argues that by rescheduling this work later in CP4 it will be possible for more renewals to be carried out at lower cost using new methods and high-output equipment.
‘Jam tomorrow’ has been a fact of life for the railway industry for long as I can remember. But, significantly, the Railway Industry Association’s Business Survey, carried out in November, shows that demand is now the greatest single constraint on business across the industry. Fluctuations in orders and workload are now a ‘major Problem’, hampering efforts to reduce costs and making the retention and development of skilled staff more difficult.
IEP and Thameslink, together costing north of £5 billion, are coming to the Private finance Initiative market simultaneously. At the same time the
Meanwhile, my chums in red braces reckon that when it comes to funding IEP and Thameslink, the appetite in the money markets is probably under £1billion - and then in packets of between £50-100million.
So here’s new term for the new financial climate – ‘slicing’. In other words, you ‘slice’ deliveries and funding of trains and facilities into Phases, the hope being that if you get the first phase way, the recovery of the world economy will see further funding becoming available for the later ‘slices.
In the case of IEP, DfT Rail has already proposed slicing delivery into four Phases. Thameslink is seen as a two part solution.
Slicing IEP makes practical and economic sense since it allows time for the extent and timing of the Great Western Main Line electrification to be determined and also bins the irrational decision to replace the IC225s prematurely. Thameslink is not so simple – unless you widen the gap between the slices and put back the 24trains/hour service by a year or so.
But at the moment, when you ask bankers whether financial close on IEP alone can be achieved this year, they tend to reply with a ruminative ‘hmmm’.
As forecast in e-Preview the
So there’s just a quick run through in this month’s Informed Sources while I try to find out what is really happening – starting with a technical briefing on the new trains.
In the ‘smoke and mirrors’ department, the announcement still quoted the delivery schedule in the original Invitation to Tender. This has been overtaken by the ‘slicing’ mentioned above and the column shows current thinking.
There is also a big surprise, following my piece on the role of adhesion in bi-mode performance last month. In my analysis I assumed 12 axles motored on the full length train, went to 16 as a double check.
But, true to their domestic philosophy,
So it’s back to the spreadsheet and some more graphs next month because I’m still not convinced by some of the journey times being quoted.
Last month’s e-Preview left me looking forward to a meeting on the 1300 HLOS vehicles with the Conservatives and, at the end of the week, a Fourth Friday Club meeting. So if you were in the café in Portcullis House and wondered who was firing up a spreadsheet on his laptop among the coffee cups, it was me giving and instant tutorial on where 1300 new vehicles come from.
At FFC Andy Mitchell, the Thameslink Project Director gave an excellent presentation, faced some tough questioning and reassured us that the infrastructure and enough trains will be ready for Key Output Zero on 22 March.
This month there was a fascinating paper on the Victoria Line resignalling at the IRSE, much food for thought on future projects, such as the possible Automatic Train Operation mooted for Thameslink. Some against the clock reporting of the IEP announcement for the Stealth Newsletter and Modern Railways completed the week.
In the week just past I had my meeting with Transport Secretary Lord Adonis. Having met more Transport Ministers over more years than I like to acknowledge, I was not expecting much and was pleasantly surprised. Indeed it was the first time that not only could you discuss railway policy in the sort of detail Modern Railways readers would expect but the Minister could also take on-board ideas, consider them, and bounce them back off the cuff.
One of these ideas was my perennial argument that the whole industry – operators, ROSCOs, manufacturers - need a proper rolling stock plan. To my surprise he suggested we meet again after Easter for a more detailed discussion with Dr Mike Mitchell present. Of course, Ministers always say ‘see you again’ at the first ‘get to know you’ meeting, but, to-date, they have invariably decided that 45 minutes of Ford is more than enough. Will it be different this time? I’ll be doing some homework just in case.
This coming week I sit down with two Japanese engineers for a briefing on the nuts and bolts of IEP, or Super Express as it is now called. It seems clear that
Then the railway will come together for the funeral of one of its best known figures, my long term colleague on Modern Railways
March starts with a session with Freightliner’s Engineering Director on the Class 68 and related matters. Later in the week there’s a visit to Golders Green Depot for an update on the Northern Line fleet train provision contract.
Dominating the second week of March is Railtex. If you are exhibiting let me know and I’ll try to drop off for a coffee or snack as I tramp the aisles.
On 17 March IRSE has a seminar on signalling Projects and in the last week of the month I hope to have a day out looking at SWT’s ITSO smartcard scheme followed by a meeting on ‘Rail renaissance’ at the House of Commons
Meanwhile, I was impressed by the response to my offer of the IEP Q&A in last month’s e-Preview. With over 150 requests I became very slick at replying and attaching!
One other thing. I am conscious that this month’s e-Preview is a bit longer than usual. If this is pain for whatever reason, please let me know.
Roger