FirstGroup PLC (LSE:FGP) has unveiled plans for privately-funded rail services to Wales and Devon just a day after the government confirmed it would renationalise its South Western railway franchise.
Graham Sutherland, chief executive, said: "Growing our open access rail portfolio is a key priority for FirstGroup.
“The introduction of our new Carmarthen to London Paddington service will significantly bolster our footprint, and should our other applications be successful, we will almost treble our current open access capacity over the next few years.
“Our successful investment in open access through Lumo and Hull Trains has helped connect communities and drive economic growth and we aim to help spur similar effects along this route."
FirstGroup will take over the route to Carmarthen through the acquisition of Grand Union Trains, which has open access track access rights.
The new service between London Paddington and Carmarthen is anticipated to be introduced in December 2027 and run to at least the end of 2037.
FirstGroup expects the service to contribute annual revenues of £50 million after two years, with a low double-digit operating margin,
A further open access application has been submitted for an additional five return trips per day between London Paddington and Paignton in Devon under the Lumo brand.
This planned service, scheduled for May 2028, would take around 3 hours and 20 minutes and stop at Bath, Bristol Temple Meads, Taunton, Exeter St David's and Torquay.
Shares in FirstGroup were flat at 153.3p.