Provisional clearance of National Express bid for Thameslink

Competition Commission report (82 pages, PDF) providing the reasons for a provisional finding that National Express' acquisition of the Thameslink Great Northern rail franchise would not lead to a substantial lessening of competition. Appendices A-N and a glossary are also available.

The basis for the finding of no substantial lessening of competition on the Gatwick-London flow is:

We are satisfied that the constraints discussed in the previous paragraphs would make it difficult or undesirable for NEG to reduce service quality or frequency on the Thameslink route between London and Gatwick, or for it to raise prices on the limited number of unregulated fares that we have identified, in particular the cheap day return, were it to operate both the Gatwick Express and Thameslink franchises. Nor do we expect an increase in coach fares over and above network fares, or a reduction in coach service quality or frequency, in those circumstances. Having weighed up the evidence, we do not expect an SLC on the Gatwick-London flow if NEG were to be awarded the TGN franchise.

The main relevant constraints underpinning this finding appears to be the difficulty of charging more for London-Gatwick than for London-Three Bridges, and National Express's claims that "Thameslink faced very substantial competition from Southern on the Three Bridges flow" and that "demand elasticities of [minus] 1.5 had been estimated by ITS on other similar flows".

Responses by Monday 12 December 2005.

For further information or advice please contact Franck Latrémolière.

Filed under Competition Commission, Merger control, Public transport.

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