Subject to certain closing conditions, Virgin Group is to make a minority investment in Brightline, which will be managed and operated by Brightline’s executive team and affiliates of Fortress Investment Group. Brightline is to rename itself Virgin Trains USA this month, and transition to Virgin Trains USA branding in 2019.Mr Branson has high hopes for expanding his rail service in the States.
Brightline currently operates passenger services between Miami, Fort Lauderdale and West Palm Beach in Florida, with plans to expand to Orlando and Tampa. It has also announced plans to acquire the XpressWest project to develop a federally-approved rail corridor connecting Las Vegas with southern California.
Brightline said Virgin Group was ‘one of the world’s most recognisable brands in travel and hospitality’ and the partnership would allow it to leverage Virgin’s ‘industry-leading expertise and customer experience’ to establish a ‘powerful’ brand.
We have a long history of creating innovative businesses that shake up markets and establish loyal followings. We transformed domestic air travel with Virgin America and have spent more than a decade looking for a similar opportunity to change the face of American railways. We believe Brightline is at the forefront of this innovation and the ideal partner to work with to alter perceptions and traveling habits across the United States.Look for this partnership to bring back some of the features of the old Florida East Coast, with echoes of the transcontinental railroads with hotels in the national parks.
On the potential of rail travel, [Brightline board chairman Wes Edens] and I are kindred spirits. Rail is a sector close to my heart after 21 years of running Virgin Trains in the UK, creating breakthroughs from tilting Pendolino trains to the automated delay repay scheme. Virgin Trains continues to go from strength to strength, transporting more than 38 million passengers on the UK’s West Coast Main Line last year. We’re looking forward to working alongside Wes and Brightline to rejuvenate the US trains market too.
The trademark licensing agreement with Virgin Group “will allow Brightline to leverage Virgin’s industry-leading expertise and customer experience to establish a powerful new brand, ‘Virgin Trains USA,’ Brightline said, noting that Virgin Group “has more than 60 companies focused on its core consumer sectors of travel and leisure, telecoms and media, music and entertainment, financial services and health and wellness. The partnership could help to provide access to millions of customers with the potential for increased ridership from other Virgin-branded travel and hospitality businesses, including Virgin Atlantic, Virgin Hotels and Virgin Voyages.”I have slagged on Virgin's British trains as offering spartan accommodation, compared with Brightline's. But the British trains continue the tradition of universal service inherited from British Railways, whilst Brightline give the impression of a rolling gated community.
But with Virgin operating flying machines and hotels, can additional train services to airports and cruise ports be far away?
Brightline launched service between Miami, Fort Lauderdale and West Palm Beach in May 2018 and currently has plans to expand to Orlando and Tampa. Pending the closing of the previously announced XpressWest acquisition and receipt of necessary federal approvals, it plans to begin construction next year to connect Las Vegas and Southern California.The plans for expanding the Passenger Rail service include an initial public offering of shares.
Florida’s Brightline announced Friday that it would jettison years of branding to become Virgin Trains USA [see “Brightline enters branding, marketing partnership with Virgin Group," Trains News Wire, Nov. 16, 2018], but that turned out not to be the company’s only big news: Later Friday, it filed a prospectus for an initial public offering with the Security [c.q.] and Exchange Commission.The prospectus includes a discussion of service in Texas, where 125 mph diesel trains might be more easily brought in and gotten running than a from-scratch fast electric railroad.
The 200-plus page document is available here.
We'll keep watching.