FirstGroup's GB Railfreight wins 12-month extension of UK mail train contract

FirstGroup PLC unit GB Railfreight said it has done a deal with Royal Mail to continue moving mail by rail for at least another year.

GB told AFX News that it has won a 12-month extension of its contract with the state-owned mail group to run postal trains between London, the north west and Scotland.

The company has not disclosed the value of the extension, which is due to run until the end of March next year.

A GB spokesman said there would be no change to the existing arrangements under which the company runs two return services a day between Willesden in London, Warrington and Shieldmuir in Scotland.

However, the contract allows for the number of trains to be increased on a night-by-night basis subject to requirements.

‘The two sides will always talk about developing the relationship and that could lead to it going beyond that,’ the spokesman added.

‘GB Railfreight is in this for the long haul and Royal Mail has indicated that it wants to see rail as part of its distribution network.’

GB signed a contract with Royal Mail to move mail by train until the end of March 2006, with options for a further 12 months, after a successful trial over Christmas 2004 and early 2005.

It followed Royal Mail’s failure to renew its deal with previous postal train operator English, Welsh & Scottish Railway (EWS) due to a disagreement over costs.

Royal Mail subsequently moved all mail and parcel traffic to road and air, which resulted in the end of 176 years of postal trains in the UK and drew criticism from MPs and environmental groups.

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