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Prospectus Blog Branson’s Virgin Group Steps Into U.S. Rail Arena

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Photo Source: Virgin Group

There are entrepreneurs. And then there is Richard Branson. Branson,
who waded into the U.S. transportation world with Virgin America
Airways (which just reported its first quarterly profit), appears ready
to try his hand at a less-proven transportation mode — at least for
the U.S., anyway. The Virgin Group founder has, according to The Wall
Street Journal
, “joined an all-European consortium that plans to bid
for Florida’s planned high-speed rail line.”

Virgin, which operates a rail franchise in the U.K., sees the market as
a natural extension of its existing U.S. transport activities, which
include Virgin Atlantic Airways–a big player in the Orlando airline
market–and Virgin America.

Whether or not Branson and others have a chance to bid on anything may still be up in the air. As
National Public Radio reports, “high-speed rail may be among the
casualties of last week’s midterm elections.”

The newly elected
governors of Ohio and Wisconsin have indicated they don’t want the
money allocated for high-speed rail to their states. In Florida,
according to The Wall Street Journal, the group Branson is joining for the bid “would be among eight potential bidders for the main portion of the
84-mile-long project.” The Florida project “could be the first such
project to move off the drawing board in the
wake of the Obama administration’s high-speed rail push, provided it
isn’t scuttled by the state’s new governor-elect, Republican Rick
Scott.”


The Wall Street Journal

Virgin Group Joins Florida High-Speed Rail Bid

By Doug Cameron and Bob Sechler
Of DOW JONES NEWSWIRES
 
Virgin Group has joined an all-European consortium that plans to bid for Florida’s planned high-speed rail line, despite the threat to the Obama’s administration’s transport agenda from the new Republican control of Congress.

The U.K. group, led by entrepreneur Richard Branson, has signed up as the train operator alongside Alstom SA (ALO.FR) and Vinci SA (VCISY, DG.FR) of France and Spain’s Obrascon Huarte Lain SA (OHL.MC).

Virgin, which operates a rail franchise in the U.K., sees the market as a natural extension of its existing U.S. transport activities, which include Virgin Atlantic Airways–a big player in the Orlando airline market–and Virgin America.

A Virgin spokesman confirmed it had joined the consortium, with an official announcement expected as early as next week.

Florida’s planned $2.7 billion Tampa-to-Orlando high-speed rail line could be the first such project to move off the drawing board in the wake of the Obama administration’s high-speed rail push, provided it isn’t scuttled by the state’s new governor-elect, Republican Rick Scott.

Virgin’s group would be among eight potential bidders for the main portion of the 84-mile-long project that is expected to go out for bid early next year, with completion tentatively set for 2015.

Recent Republican gains in the mid-term elections could jeopardize high-speed rail plans in Florida and elsewhere, as well as other federal stimulus efforts.

Scott has been critical of high-speed rail and said during his campaign he would only support the Tampa-to-Orlando project if the federal government footed the entire bill.

Florida transportation officials have been counting on about $2.2 billion in federal funding, with the remainder coming from state sources.