A smaller, humbler Stagecoach Group is set to unveil annual results on Wednesday. Its American dream has ended, and it faces a final departure from the UK railway network it once dominated.
The City may not be entirely distraught to see the transport group’s forced exit from rail – even if that means saying goodbye to Virgin Trains on the west coast, which has showered the two Sirs (Virgin’s Sir Richard Branson and Sir Brian Souter, Stagecoach’s co-founder) with vast dividends since privatisation. Elsewhere in the business, losses piled up on the short-lived Virgin Trains East Coast franchise, and it only looks to be a matter of time before other train operators see their contracts follow Virgin’s down the Swanee. Investors may well feel that if being barred from the East Midlands and Southeastern franchise competitions is the price to pay for refusing to guarantee workers’ pensions, so be it.
Stagecoach’s rival National Express has already kicked the British rail habit, and its chief executive, Dean Finch, is reputedly happier and richer for it. Meanwhile, FirstGroup’s biggest shareholders, having secured an emergency meeting on Tuesday, are still threatening to sue the board rather than see them accept another cash-chomping rail franchise.
Yet Stagecoach looks as though it will have trouble going cold turkey, and continues to throw lawyers at the Department for Transport in the franchising dispute. While few normal citizens could fathom the deep joy or pain inside chairman Souter, perhaps this speaks to a deeper need.
Could the Stagecoach billionaire really be satisfied, after decades hobnobbing with Branson on flash Virgin trains and lobbing dollars around the US, to see his firm reduced to a future of buses trundling around our small island? Many a transport journalist will, like Souter, have occasionally experienced the glitz of a press launch with Branson – even with that slightly uneasy feeling of wondering whether this cash might have been better taxed onshore, or if he should put that model in the bikini down now. Take away that kind of expensive jazz, and you’re just another grumpy middle-aged man left to obsess about buses.
Stagecoach’s website still bangs on about it being a multimodal transport provider. Its co-founder, Souter’s sister Dame Ann Gloag, once snapped up a briefly functioning airport at Manston. But in a few short months, the only shred of multimodality in the group will be provided by the Sheffield supertram, whose Rotherham extension is best known for costing five times its budget and sparking a parliamentary inquiry.
Stagecoach used to talk about spanning five continents, but it flogged its last foreign outpost this year, selling its American coach operations at a knockdown price. Having long abandoned whatever it was it did on the other three continents, the company’s horizons look about as limited as the rest of Brexit Britain’s.
Another fly in the Stagecoach ointment could conceivably come on Monday, when Manchester’s mayor, Andy Burnham, announces plans for the city’s transport network. However, his early ambition to regulate the private bus operators’ lucrative activity – the biggest potential incursion into the sector for decades – looks to have dissipated. The British bus, always by far the most profitable vehicle for the group, should continue to fill Souter’s coffers for some time yet.
