Virgin Trains has been handed a contract to run the West Coast Main Line until at least 2017, less than two years after the firm took the government to court to avoid losing the franchise altogether.
The Department for Transport said the extension to Virgin Trains’ franchise would bring better Wi-Fi, £20m in station upgrades and new direct services from London to Shrewsbury and Blackpool.
Virgin will also convert 21 first-class carriages into standard class to create more space for 5,500 extra passengers a day.
Unlike a franchise contract, the direct award has been given to Virgin without a full bidding process. It is the sixth direct award made by the DfT since the franchising process collapsed in 2012, when Virgin launched a judicial review to challenge a decision to give the West Coast to rival FirstGroup.
The short-term awards are intended to stagger the UK’s franchise contests and avoid a glut of work for the DfT staff who judge the bids.
The DfT said Virgin Trains, a joint venture between Virgin and Stage-coach, would pay the government a total of £430m to operate the route for an extra two years and nine months.
“We’re delighted to have reached a deal after some tough negotiations with the DfT,” said Virgin Trains co-chairman Patrick McCall.
“It puts the problems of 2012 firmly behind us, and shows the clear benefits of a well-run franchise system.”