South Western Railway — which operates rail services in the region — says it could lose its franchise after recording a loss of £137 million.
The train operator is in talks with the Government over its contract, which is due to expire in August 2024.
SWR, which runs routes connecting London Waterloo from Bristol, Exeter and Weymouth, says its performance had been affected by timetable delays, strikes and infrastructure reliability.
Directors said ongoing discussions with the Department for Transport could result in the “termination of the contract within the next 12 months” which would see “services being transferred to a publicly-owned operator”.
SWR passengers had 27 days of disruption in December. It was the latest in a series of strikes over the future of guards.
The company’s accounts for the year ending 31 March 2019 showed a loss after tax of more than £136 million.
SWR, owned by FirstGroup and Hong Kong based firm MTR, took over the franchise contract in August 2017.
Mick Cash, general secretary of the rail union RMT, said the owners of SWR had set aside funds to provide for “the maximum unavoidable loss”.
He added: “Rather than allowing South Western Railway to collapse into chaos, RMT is demanding that the existing operator is stripped of the franchise with the public sector taking over as soon as possible.”
South Western Railway operates routes connecting London Waterloo with Woking, Guildford, Reading, Bristol, Exeter, Southhampton, Portsmouth, Bournemouth and Weymouth.
SWR adds: “We continue to be in ongoing and constructive discussions with the Department for Transport regarding potential commercial and contractual remedies for the franchise and what happens next, in order to ensure we reach the right outcome for the Government, our shareholders and our customers.”
