An interview with Arriva CEO Manfred Rudhart
6 January 2017 • Author(s): European Railway Review
European transport operator Arriva has grown considerably over several years, both in the UK and mainland Europe, where it has cemented its position as a leading transport and mobility solutions provider.
The group’s growth in the UK rail, particularly through last year’s Northern franchise win and the London Overground concession award, which they began solely operating this November, has gained attention across the sector. However, it’s not just on the tracks where Arriva’s diverse growth plans are thriving. Their presence in mainland Europe has taken further steps forward this year as the group has gathered bus acquisitions, namely in Italy and across Eastern Europe.
Steering Arriva’s future plans and strategy over the past 12 months has been CEO Manfred Rudhart. The widely respected German, who took over the Arriva helm from industry stalwart David Martin in January this year, joined Arriva after eight years at parent company Deutsche Bahn, where he held a variety of senior management and finance roles, lastly as the CEO for three years at DB Regio, the state transport giant’s operator of regional rail and bus services.
Now after almost a year of settling into the CEO’s chair, Rudhart has taken the time to speak to European Railway Review’s Katie Sadler on his role, tapping into new markets, and his plans for Arriva’s future.
You are almost a year into your role at Arriva. What would you say are the areas which have impressed you most about the business since arriving?
“Coming from a DB company I knew Arriva’s strengths and opportunities before I arrived, but it’s only when you get under the skin of the business that you see for yourself the passion and experience we have.
“Our people are ready to embrace new ideas and that has really pleased me. The business has an entrepreneurial spirit which I think is unique. It’s one of our huge strengths.”
Urban mobility is an ever-growing concept and is seeing record levels of investment across Europe. Is Arriva doing enough to position itself in new mobility markets such as car sharing and bike sharing schemes?
“These new markets are of important interest to us and we are fully committed to studying future mobility schemes and partnership opportunities. However, we are clear that all schemes and market conditions must be right for our passengers, for Arriva and must offer integration opportunities.
“There is ongoing work to look at potential car sharing and bike sharing schemes across major cities in Europe following our Copenhagen DriveNow launch in September 2015.”
Arriva’s share in the UK rail market has grown again over the past 12 months with the commencement of the Northern rail franchise in April and the London Overground contract in November. What are the next steps for Arriva in UK rail?
“The next steps are ensuring operational excellence and further growth. We are now six months in to the Northern franchise and our investment programme is continuing – a programme that will deliver the biggest transformation in a generation. We’re also proud to have recently welcomed the London Overground team into the Arriva family and are working hard with colleagues from Transport for London to make even further improvements to the capital’s fastest growing transport network.
“CrossCountry too has seen a contract extension this autumn so that was positive news and a green light for us to make further improvements and investment.
“Moving on, it’s been well documented that Open Access services are something we’d be keen to continue to grow and develop – especially following the recognition and high customer satisfaction ratings Grand Central has received. We have just opened dialogue with the ORR regarding plans to operate open access services between London Waterloo and Southampton.
“In terms of franchising, it’s been a hot topic in the past few years in the UK and we’re always keen to share our expertise. The UK franchising model has helped to deliver significant passenger growth and while bidding is costly, we continue to carefully assess all opportunities. That includes the Wales and Borders franchise for which we have pre-qualified.”
And staying in the UK, how is Arriva’s UK Bus business performing? Do the proposals covered by the Bus Services Bill give Arriva cause for concern?
“Like UK Trains, our bus business in the UK has a first-rate leadership team in place, both in the regions and within London. Led by Kevin O’Connor, we are constantly challenging ourselves to innovate and deliver increased bus patronage. Our smartphone app is just one example of how we’re using technology and I think that more than ever, we are understanding travelling patterns which is helping to reconfigure and reinvigorate bus routes.
“When it comes to the Bus Services Bill, this is still going through the Parliamentary process and we welcome the focus on the bus sector which is too often overlooked. Arriva’s view on bus policy is quite simple: the test for its effectiveness is whether it supports sustainable passenger growth and investment in services.
“The Bill includes some interesting new partnership powers providing a framework for operators and local government working together to boost bus patronage and tackle barriers to growth.
“There’s evidence from across the UK that such partnerships support bus usage. One good example is in Merseyside where we recently signed an alliance with Merseytravel and Stagecoach, helping secure investment in customer improvements and committing everyone to clearly defined targets.”
Moving further afield from the UK, Arriva’s Central and Eastern European operation is seeing steady but constant growth through acquisitions and contract wins since the takeover of VTCE in 2013. What are the long term plans in the region?
“We see Eastern Europe as a long-term growth market and want to expand our position further. Our business in the region is almost unrecognisable following the changes, growth and improvements we’ve made. Bus market growth, including long distance routes, in countries like Slovakia and the Czech Republic are just two examples.
“Overall, our success in the region has been all about constantly moving forward, investing time in relationships with local authorities and customers, and vitally, understanding local markets. As more markets in the region liberalise, I expect more opportunities for us to expand and integrate further.”
Arriva’s Northern European countries are also entering an exciting period?
“They are, and perhaps the biggest news we have was the start of the Limburg contract in the Netherlands on 11 December. It’s an extensive multi-modal contract that we mobilised for over 12 months. Over several years will deliver a new customer experience for thousands of passengers who rely on those bus and rail services – investing in new buses, trains and technology. It’s fantastic to be operating such a high-profile contract in the Netherlands, a country where we already have a consistently strong reputation.”