Budget train fares offering travel from London to Scotland for less than £25 will be offered after FirstGroup was given the go-ahead to compete with Virgin Trains on the East Coast Main Line.
The Office of Rail and Road (ORR) regulator granted approval for FirstGroup to launch open access services between London, north-east England and Edinburgh.
The 10-year deal will allow it to operate five trains a day each way from London King’s Cross to the Scottish capital, via intermediate stations at Stevenage, Newcastle and Morpeth from 2021.
Virgin Trains East Coast (VTEC) currently holds the franchise to run services on the line until at least March 2023.
FirstGroup claimed its trains would offer cheaper fares and free Wi-Fi, making them a better option than other rail services and air travel.
The company’s chief executive, Tim O’Toole, said: “I’m pleased that the ORR has granted track access rights for our unique low-cost service between London, the North East of England and Edinburgh.
“This is great news for passengers, as our new service will widen the choice of travel options between these cities and offer an attractive alternative to those available today.
“We will offer genuinely low fares at half the average price of today, while adding significant benefits to the UK economy.
“Our brand new trains will be cheaper than other rail services, greener than the plane, quicker than the coach and will get passengers from London to Edinburgh earlier than they can arrive today, all for an average fare of less than £25.”
Stagecoach Group – which owns 90% of VTEC – criticised the decision to allow FirstGroup to run competing services.
Martin Griffiths, chief executive of Stagecoach Group, said: “We do not believe the granting of these services within a franchised system and without a level playing field is in the best interests of passengers, taxpayers or communities.
“We will assess the ORR decision and implications in detail and review our options.”