Author Topic: Will First leave Northampton?  (Read 2952 times)

Offline Dennis Lloyd

  • Hero Member
  • *****
  • Thank You
  • -Given: 4
  • -Receive: 19
  • Posts: 430
Will First leave Northampton?
« on: December 17, 2011, 09:49:54 PM »
In this month's issue of Buses there is an article saying that First are considering ridding itself of more parts of it's UK bus  operations.

Dare we hope that Northampton might be lucky enough to be one of the operations it gets rid of.

Considering the relatively small operation they now have in the town, I would never be surprised if they did. ;D ;D ;D ;D


Offline SURREYMAN

  • Hero Member
  • *****
  • Thank You
  • -Given: 16
  • -Receive: 28
  • Posts: 264
Re: Will First leave Northampton?
« Reply #1 on: December 18, 2011, 01:17:10 PM »
Problem is, if First said "we are sick of losing money, lets sell up and leave" they have to find a buyer who is happy to take on their operation (routes, staff transferred on TUPE, Depot, maybe some vehicles etc) knowing that Stagecoach isn't going to stand still in such a situation.
Stagecoach would probably love to takeover the First Northampton operation but I can't see the Oft/CC allowing that in the light of the supposed 'scandal' in the North-East.
I don't pretend to be familiar with Northampton bus operations but I would hazard a guess that the simple economics for the First Operation must be down to costs exceeding revenue and lack of economies of scale in a small scale operation.
Perhaps someone on here with local/inside knowledge correct me/ provide more info?
Personally I think Stagecoach should register some competing commercial services, slowly tightening the screw.
Before anyone mentions it, yes I know that peoples livelihoods could be threatened but one thing is sure, no Stock market listed company is going to allow a loss making business unit to continue indefinitely and First have had plenty of time to try and fix it.

Offline Dale

  • Hero Member
  • *****
  • Thank You
  • -Given: 1
  • -Receive: 10
  • Posts: 295
Re: Will First leave Northampton?
« Reply #2 on: December 18, 2011, 04:23:29 PM »
Dennis,

I was just about to reply but 'Surreyman' has largely said my words for me !

I know we've been here before about First in Northampton and their own senior management has acknowledged that Northampton is a difficult issue to resolve. Essentially, it has 2 key problems - a) it's now too small and b) it's got Stagecoach sitting on the doorstep.

Stagecoach could simply register over the few remaining First services but they probably recognise that this may generate poor publicity in the short term. There seems to be no reason for Stagecoach to rush to do anything as First has been gradually contracting for a long time now and must, at some point, throw in the towel.

Dale


Offline Martin

  • Hero Member
  • *****
  • Thank You
  • -Given: 0
  • -Receive: 5
  • Posts: 1413
Re: Will First leave Northampton?
« Reply #3 on: December 18, 2011, 05:20:22 PM »
Problem is, if First said "we are sick of losing money, lets sell up and leave" they have to find a buyer who is happy to take on their operation

Why do First need to even sell? If it is such a flagging operation then any sale isn't going to return much to First's coppers.

I would imagine the majority of their assets is in vehicles so these could either be re-deployed elsewhere in the group or sold off - perhaps for scrap. Any staff could be made redundant - yes that might be a cost but sometimes is worth it to be rid of a loss making operation. Stagecoach would then be free to expand if they chose to.

Offline SURREYMAN

  • Hero Member
  • *****
  • Thank You
  • -Given: 16
  • -Receive: 28
  • Posts: 264
Re: Will First leave Northampton?
« Reply #4 on: December 18, 2011, 05:57:41 PM »
Martin,
Your post (Which I completely agree with) brings about a possible scenario which might cause the Oft and CC to choke!
For the sake of argument, lets assume that First Management say 'The Northampton Bus Operation is a hopeless case, we have tried everything and it's still losing money, time to dispose of it but no one wants to buy (For reasons I outlined earlier).
They could: -
1. De-register all the routes - 42 days notice required I think. (I am assuming they are all commercial, not sure if they have any tendered routes/Contracts).
2. Give all the staff notice and enter into consultation period - probably around 3 months notice + 30 days consultation.
3. Put the Depot up for sale.
4. (If they so wish!) Advise local council that they are closing the business down due to ongoing losses etc.
All completely legal and legit' as far as I know.
The Bus fleet, engineering equipment, office furniture and any other physical assets are transferred elsewhere/Auctioned off.
The Depot is sold.
First incur a one-off cost for the redundancy bill.
First receive payment for the sale of the assets, which of these two is the greater I do not know - Do they own the Freehold of the Depot?
Finally when the Media storm dies down, Stagecoach and any other Bus Cos register replacement services, hopefully most of the former First Staff are re-employed by the replacing Bus Companies.
I am not a Solicitor or an Accountant, so am happy to admit that it might be a bit more complicated!
Finally if it all works out, take the basic formula and apply it to other outlying/loss making parts of First Bus.

Offline Julia_Hayward

  • Hero Member
  • *****
  • Thank You
  • -Given: 2
  • -Receive: 78
  • Posts: 715
Re: Will First leave Northampton?
« Reply #5 on: December 18, 2011, 06:37:29 PM »
Given that Bury and Lynn have gone, where First didn't have a major rival sat on their doorstep, I'm surprised Northampton has lasted as long as it has - although who would be brave enough to buy it up now? The only future I can see is that they call it a day and shut down suddenly, and Stagecoach move in to fill the gaps - although to be honest there aren't many obvious ones on the map. The garage is on prime residential land, the best bits of the small fleet can easily be redeployed and the rest is fit for a one-way trip to Barnsley.


Offline Dennis Lloyd

  • Hero Member
  • *****
  • Thank You
  • -Given: 4
  • -Receive: 19
  • Posts: 430
Re: Will First leave Northampton?
« Reply #6 on: December 18, 2011, 06:38:05 PM »
Surreyman

Re your last post, I have a friend who is very well informed about  what goes on in Northampton ever since the days of Northampton Corporation Transport (happy days), and he has told me for a long time that the depot in St. James Road has been up for sale,

There are no sale signs outside but I understand that it is a prime site for redevelopment so cannot see why it has not already been sold.

Some time ago there was talk of First garaging it's buses on Brackmills Industrial Estate but that seems to have fallen through for some reason or other.

Offline Dale

  • Hero Member
  • *****
  • Thank You
  • -Given: 1
  • -Receive: 10
  • Posts: 295
Re: Will First leave Northampton?
« Reply #7 on: December 18, 2011, 06:58:08 PM »
I thought the garage had been sold a few years ago - did that fall through?

Dale

Offline J621BVG

  • Hero Member
  • *****
  • Thank You
  • -Given: 6
  • -Receive: 4
  • Posts: 1309
  • J621BVG
Re: Will First leave Northampton?
« Reply #8 on: December 18, 2011, 07:01:58 PM »
Given that Bury and Lynn have gone, where First didn't have a major rival sat on their doorstep, I'm surprised Northampton has lasted as long as it has - although who would be brave enough to buy it up now? The only future I can see is that they call it a day and shut down suddenly, and Stagecoach move in to fill the gaps - although to be honest there aren't many obvious ones on the map. The garage is on prime residential land, the best bits of the small fleet can easily be redeployed and the rest is fit for a one-way trip to Barnsley.


The Northampton fleet has some good buses!?  :D ;)

In all seriousness, that would basically mean the 15 or so remaining B7L single deckers being spread out across other fleets, the two B7TLs finally join the rest of their brethren in Leicester, and the rest probably will go to Barnsley, unless someone has the money (or is mad enough) to preserve a Northampton Citybus.
East Londoner

Offline Martin

  • Hero Member
  • *****
  • Thank You
  • -Given: 0
  • -Receive: 5
  • Posts: 1413
Re: Will First leave Northampton?
« Reply #9 on: December 18, 2011, 07:36:57 PM »
Martin,
Your post (Which I completely agree with) brings about a possible scenario which might cause the Oft and CC to choke!
For the sake of argument, lets assume that First Management say 'The Northampton Bus Operation is a hopeless case, we have tried everything and it's still losing money, time to dispose of it but no one wants to buy (For reasons I outlined earlier).
They could: -
1. De-register all the routes - 42 days notice required I think. (I am assuming they are all commercial, not sure if they have any tendered routes/Contracts).
2. Give all the staff notice and enter into consultation period - probably around 3 months notice + 30 days consultation.
3. Put the Depot up for sale.
4. (If they so wish!) Advise local council that they are closing the business down due to ongoing losses etc.
All completely legal and legit' as far as I know.
The Bus fleet, engineering equipment, office furniture and any other physical assets are transferred elsewhere/Auctioned off.
The Depot is sold.
First incur a one-off cost for the redundancy bill.
First receive payment for the sale of the assets, which of these two is the greater I do not know - Do they own the Freehold of the Depot?
Finally when the Media storm dies down, Stagecoach and any other Bus Cos register replacement services, hopefully most of the former First Staff are re-employed by the replacing Bus Companies.
I am not a Solicitor or an Accountant, so am happy to admit that it might be a bit more complicated!
Finally if it all works out, take the basic formula and apply it to other outlying/loss making parts of First Bus.

All sounds very possible to me. The only thing I would say is I don't even think the media storm would need to die down. I could imagine the local council and councillors actively encourgaing another operator to register replacement services.

On a financial basis I could see it making sense - I would be clear I don't know the area but combining two businesses clearly brings economies of scale. Whilst both operations are part of a larger group being able to reduce the numbers involved in locally managing the operations would save money. There is also the possibility that one operator would be able to increase patronage as day rider tickets etc would be valid on more services and so seen as better value for money.

Offline AN68

  • Hero Member
  • *****
  • Thank You
  • -Given: 18
  • -Receive: 38
  • Posts: 215
Re: Will First leave Northampton?
« Reply #10 on: December 18, 2011, 08:32:53 PM »
Stagecoach have a proven track record in turning First's basket case routes in Northampton into thriving commercial operations. Patronage on routes 5, 7, 8 and 22 have all seen increases. Why, because Stagecoach run their services to the published timetables and the travelling public can have confidence that a bus will turn up as expected. I certainly look forward to the day that Stagecoach takes over the running of my local service 4, as I can forsee Stagecoach seeing the traffic potential of this service, serving as it does the University. We may well see, instead of the last bus in the evening leaving Greyfriars at 2005, a bus every 20 minutes until 2330

Offline dwarfer1979

  • Hero Member
  • *****
  • Thank You
  • -Given: 0
  • -Receive: 116
  • Posts: 245
Re: Will First leave Northampton?
« Reply #11 on: December 19, 2011, 08:50:34 AM »
I don't see Stagecoach being the big threat that everyone else seems to think they are.  Given what has happened in places like Preston Stagecoach would have real difficulty reacting to a takeover of Northampton by most companies, I suspect whilst they might react to an Arriva takeover anyone else would be left alone as the risks of OFT/CC response is too high (and operators such as Rotala/Centrebus have enough size to hang on for some time if attacked, are spread enough that it is difficult to hit back and nimble enough to react quickly to any threat).  There is a lot more to a bus company than the physical assets and the routes are an important part of the worth of a bus company (so First would get more money for a going concern than by shutting down and selling off piecemeal - something I don't think Veolia understood when they shut down their operations), although it is unlikely any prospective purchaser would want to take on the depot as it far too big for the operation that is left and is in need of TLC for prolonged use, plus in the current economic climate it is likely to be more difficult to sell on for redevlopment than it should until things turn round.

Offline Dennis Lloyd

  • Hero Member
  • *****
  • Thank You
  • -Given: 4
  • -Receive: 19
  • Posts: 430
Re: Will First leave Northampton?
« Reply #12 on: January 15, 2012, 12:36:31 PM »
I see First have abandoned Bury St. Edmunds and possibly Ipswich and Great Yarmouth to follow.

How long before they get around to Northampton ?

I can't wait !!!!! ;D ;D ;D ;D