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23.05.16

Arriva integration with Northern to face in-depth competition investigation

The Competition and Markets Authority (CMA) has confirmed it is carrying out an in-depth investigation into Arriva’s integration with Northern.

The CMA halted the integration of the two franchises last week on the grounds that Arriva owns so many UK transport businesses that there would be little or no competition against Arriva on 38 train routes and 44 bus routes.

The CMA confirmed that it is carrying out the investigation, saying Arriva failed to provide it with undertakings to reduce the loss of competition.

A spokesperson for Arriva said: “We note the CMA’s announcement that its consideration of the award of the Northern franchise to Arriva will continue into phase two. We are of course disappointed to have reached this point after having discussed the possibility of undertakings in lieu of a referral to phase two with the CMA.

“However, during this process it became apparent that the development of a package of measures which would have been acceptable both to the CMA and to Arriva was unlikely without the more detailed assessment that phase two allows for. We will continue to work closely with the CMA and remain fully committed to delivering our planned service improvements for our passengers, including those for the Northern franchise.”

An independent panel, supported by a case team of CMA staff, will make a decision on the merger by 3 November.

(Image c. Phil Noble from PA Images)

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Comments

Tim David   23/05/2016 at 20:45

What actually is this 'integration' process?

Squark   24/05/2016 at 09:41

Arriva have been running the franchise since 1st April, following a competitive bidding process that has been going on since late 2014. That's about as much competition you can get on the modern, dynamic, thrusting railway. It's a bit late for the CMA to stick their nose in now. It doesn't matter if local buses and trains will feature "Arriva" on the side or not, as they'll still be owned by the same parent company, and will also be serving completely different markets in most cases anyway!

Tom   24/05/2016 at 10:21

Are they REALLY going to go through all the cost and hassle of sending this back out to tender when Arriva have been operating the franchise since April?

Jim Smuts   24/05/2016 at 11:20

Has anyone ever asked 'can I have a train from carrier X'? When I use public transport, I want to get there, I don't care who the 'carrier' is. When it was public, we paid a group of UK based managers to run it, now we have dozens of companies, using hundreds of sub contractors, finance companies, leasing agents etc, many with offshore accounts or run by other countries public services. How much of the cost of all this goes to senior management, directors and non UK organizations? Why am I paying for dozens of duplicated management structures? Why am I paying for legal action and investigations into 'competiton' that doesn't affect the cost to me as a lower price, only as a higher one?

GW   24/05/2016 at 19:55

So Stagecoach running the WCML, MML and ECML isn't a threat to competition but Arriva running Northern is! Why are the CMA so detached from reality?

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