FirstGroup’s South West move halted by watchdog

FirstGroup’s takeover of the South West Trains franchise in August has fallen foul of the competition watchdog, which fears travellers between London and Exeter will be left with no choice of operator.

FirstGroup and MTR won the franchise from Stagecoach this year but the Competition and Markets Authority is concerned that half a million passengers to one of the most remote parts of the UK will now depend on FirstGroup to get to the South West.

FirstGroup will be running South West Trains from Waterloo and also operates the other rail route to Exeter from Paddington with Great Western Railway.

It has five days to offer a remedy or it will face an “in-depth investigation” that could take months.

One proposal that FirstGroup could make is to agree price caps for the affected lines.

The CMA said it had little concern about the vast majority of the rail network that FirstGroup and Hong Kong operator MTR were taking over.

However, it feared FirstGroup running South West and Great Western routes between London and Exeter could lead to “higher fares or worse service for passengers”.

Andrea Coscelli, acting chief executive of the CMA, said: “The CMA believes that without its intervention, FirstGroup may be able to increase fares for passengers between London and Exeter, as it will be the only rail operator running all services on this route.”