The Darlington Bus War refers to a series of events between 1986 and 1995 in the UK bus industry in the town of Darlington, northern England, culminating in the wholesale entry of Stagecoach Group onto the Darlington bus scene, and the collapse of Darlington Corporation Transport.
In November 1994, the events in Darlington and in other areas prompted the Director General of Fair Trading to request the Monopolies & Mergers Commission to investigate the supply of bus services in the North East.
Background
As a result of bus deregulation in 1986, the National Bus Company (NBC) as the largest regional bus operator was split into pieces and sold off, and municipal bus companies were being put into stand-alone companies, with many being privatised. In March 1986 the bus operations of Darlington Borough Council (DBC) were incorporated as the Darlington Transport Company Ltd (DTC), although not initially sold.
In August 1986, NBC subsidiary United Automobile Services introduced a small number of new hail and ride town services in Darlington using Mercedes–Benz minibuses under the 'Roadranger' livery in competition with Darlington Transport. These services (covering Firth Moor and the Whinbush areas initially) proved successful, so shortly afterwards United purchased more Mercedes, and some Dodge S56, minibuses and hugely expanded the minibus network which resulted in a doubling of services across the whole town and intense competition with Darlington Transport. From 1988 to 1992 many requests and attempts were made to sell DTC, all coming to nothing. Your Bus, another operator set up by ex-United employees, entered into Darlington in May 1993, prompting a response from United with further registrations, later described as predatory and anti-competitive by the Competition Commission. By 1993, with 3 competing operators, concerns had been raised over 'over-bussing' and congestion in the town centre. By 1994 all three operators were making financial losses.
Due to its financial state, DTC was put up for sale in July 1994. In response to the sale announcement, United registered additional services on DTC's routes.
Busways interest
In early 1994 independent Busways had explored the possibility of entering into the Darlington market, as a possible option for expansion. This was shelved as bids from major groups for the Busways company were considered. Busways were sold to Stagecoach Group in July 1994. After a meeting with Stagecoach executives, the decision was made to enter Darlington, either through a bid for DTC, or as a new operator. Accordingly, Busways as a subsidiary company set up Stagecoach Darlington, and registered a small network in Darlington in September 1994, due to start in December, as a result of concerns over availability of drivers. Exclusive bids for DTC by Stagecoach had been previously declined.
Bidding process
According to government rules, DBC were obliged to sell DTC by competitive tender. After initial enquiries, from 11 initial interested parties, 3 were short listed as preferred bidders for DTC on 14 October 1994: Yorkshire Traction: £1.5m Busways: £1.0 million Badgerline: £0.8 million
As United were already a competitor in the town, they were barred from the bid process on competition grounds. Accordingly, on 24 October 1994 DBC selected Yorkshire Traction as the preferred bidder.
Collapse of Darlington Transport Company
On learning of the successful bid by Yorkshire Traction, the drivers union of DTC made representations to Busways that Yorkshire Traction were not their preferred bidder, and the majority of drivers would probably be interested in joining Busways' new operation. Accordingly, with worries over recruitment and training now reduced, Busways registered all of DTC's commercial routes, and commenced a recruitment drive.
Busways quickly recruited over 60% of DTC's drivers by 7 November. Amid concerns that DTC would not be able to fulfil its services due to driver shortage, and with concerns over United having a free hand in Darlington if DTC collapsed, Busways requested an advance on their registration date. This was refused. Busways exploited a loophole in the regulations, and began operating free buses on their Darlington network. Busways called in several vehicles from its other subsidiaries, and repainted several of its surplus Leyland Atlanteans into Stagecoach stripes, notable because none of Busways Atlanteans were ever painted in Stagecoach livery.