Statement re TransPennine Franchise

FirstGroup plc and Keolis                           

                 Welcome Trans Pennine franchise announcement                  

                                                                   31 July 2003

FirstGroup and Keolis today welcomed the Strategic Rail Authority's (SRA)
decision to select them as preferred bidder for the new Trans Pennine Express
franchise.

Trans Pennine Express (TPE) will operate intercity passenger rail services
between many of the major cities in the North of England including Liverpool,
Manchester, Leeds, York, Hull, Sheffield and Newcastle. TPE is expected to
generate about 13 million passenger journeys per annum. The new franchise is
due to run for 8 years with a 5 year extension. The franchise is expected to
commence in early 2004.

Moir Lockhead, Chief Executive of FirstGroup plc, said: 'I am delighted that we
have been awarded this franchise. Together with our partner Keolis I am
confident that we can provide a high quality service that will contribute to
the economic growth of the region and provide an attractive alternative to the
car.

Jean-Pierre Deghaye, Keolis director, said: 'We have exciting plans and look
forward to developing them in partnership with the SRA, passenger transport
executives, county and district councils and other stakeholders in the region.'

The bid includes plans for:

  * A £260 million investment programme which will create around 200 new jobs
   
  * Replacing the entire fleet with 100mph trains to give faster journeys and
    improve comfort, punctuality and reliability
   
  * Building new train maintenance depots on both sides of the Pennines
   
  * Upgrading all 30 stations to be managed by the franchise
   
  * Recasting the timetable to provide even-interval departures that are
    attractive and easy to use and which reduce delays
   
  * Improved staff training and customer service
   
  * Developing integration between rail, bus and trams including improved
    connections and through-ticketing.
   
Contacts:

FirstGroup plc

Michael Mitchell, Corporate Communications Director 020 7291 0504

Robin Etherington, Communications Manager, Rail Division 01675 443812.

Keolis

Bruno Auger or Guillaume Genin 020 7953 7124

Notes to Editors:

Towns and cities to be served by the new TransPennine franchise include:

Manchester                              Huddersfield                           
                                                                               
Manchester International Airport        Barrow-in-Furness                      
                                                                               
Liverpool                               Windermere                             
                                                                               
Leeds                                   Doncaster                              
                                                                               
York                                    Grimsby                                
                                                                               
Sheffield                               Scunthorpe                             
                                                                               
Newcastle upon Tyne                     Selby                                  
                                                                               
Middlesbrough                           Lancaster                              
                                                                               
Scarborough                             Stalybridge                            
                                                                               
Stockport                               Warrington                             
                                                                               
Preston                                 Durham                                 
                                                                               
Bolton                                  Northallerton                          
                                                                               
Dewsbury                                Darlington                             

FirstGroup plc

FirstGroup plc is a UK based international transport company with a turnover of
more than £2 billion a year, and 57,000 employees throughout the UK and North
America.

  * The Group is Britain's largest bus operator running more than one in five
    of all local bus services. A fleet of some 9,500 buses carries 2.7 million
    passengers a day in more than 40 towns and cities.
   
  * The Group is also one of the UK's largest rail operators with three
    franchises - First Great Western, First Great Eastern and First North
    Western. It is introducing new trains in each franchise at a cost of more
    than £200 million. The group operates nearly one-fifth of the UK passenger
    rail network, with a balanced portfolio of inter-city, London commuter, and
    regional services.
   
  * It holds the operating contract for the Croydon Tramlink network which
    carries more than 16 million passengers a year.
   
  * In North America the Group has three operating divisions: First Student
    (Yellow School Buses), First Transit (Transit Contracting and Management
    Services) and First Services Vehicle Maintenance and ancillary services
    (First Services). Headquartered in Cincinnati the businesses operates
    across the US and Canada.
   
  * 
      + First Student is the second largest provider of Yellow school buses in
        the USA and the third largest in Canada. With a fleet of some 15,500
        school buses it transports nearly one million students everyday.
       
      + First Transit is one of the largest private sector providers of urban
        bus services in the US, managing public transport systems on behalf of
        cities such as Houston, Denver and New York.
       
      + First Services is the largest private sector provider of vehicle
        maintenance in the US. Maintaining fleets and equipment for primarily
        public sector customers such as cities, counties, fire and police
        departments
       
Keolis

  * Keolis is one of the leading transport groups in Europe with a turnover of
    approximately £1 billion, and is the largest private transport operator in
    France with 23,000 staff and a market share of 40 per cent of urban
    networks open to competition.
   
  * In France, Keolis has a wide variety of transport operations, including
    traditional and guided buses, traditional and driverless underground
    railways, tramways, railways, trolleybuses, funicular railways, and a cable
    car.
   
  * It provides inter-city transport between 64 départements (regions) and
    operates on 85 urban networks, including nine areas with populations over
    200,000, and two with more than two million people.
   
  * Internationally, Keolis operates rail networks, urban transit systems or
    inter-city rail links in six other countries: UK, Netherlands, Germany,
    Sweden, Denmark and Canada.
   
  * In the UK, it is a partner in the GoVia joint venture which is the current
    Thameslink franchisee. Last year, GoVia took over the South Central
    franchise from Connex.
   
  * SNCF, the French, state-owned railway company, owns 43.5 per cent of
    Keolis. BNP Paribas, the biggest French bank, is the largest shareholder
    with a 48.7 per cent stake.
   
  * Keolis is committed to delivering integrated transport solutions and to
    develop co-operation with transport authorities and other stakeholders.