The Impact Of HS2 On The UK’s Transport Sector – BinaryOptions

Best Binary Options Brokers 2020:
  • Binarium
    Binarium

    Best Choice!
    Free Trading Education!
    Free Demo Account!
    Big Sign-Up Bonus!

  • Binomo
    Binomo

    Good Choice For Experienced Traders!!!

The Impact Of HS2 On The UK’s Transport Sector

Published on February 17, 2020

The background of the HS2 has been long and controversial, with many people threatened with being uprooted from their homes and much debate around the large expense.

However, the struggle has seemingly been won as the UK government announced its plans to approve the HS2 project.

The route, which is set to link London, Birmingham, Manchester and Leeds, aligns with the government’s desires to create more jobs and rebalance the country’s economy.

The project, which is already running behind schedule and over budget, is now due to be completed in full by 2040.

Project Clarity

After much confusion over the status of the project, the recent statement from Prime Minister Boris Johnson giving the project the green light has worked to fix some of the uncertainty that had been hanging over HS2 and its associated engineering companies.

Not only has the government backing for HS2 had a direct impact on several shares in the engineering sector, but it has also provided a further boost for other companies that have been on a rally in recent months.

Where uncertainty had previously been hanging over Balfour Beatty, Costain and Kier, shares have now been boosted.

So, which other companies and shares have been affected by the announcement?

FirstGroup (LSE: FGP) is one of the companies that has been buoyed by the recent news, especially as FirstGroup recently secured the rights to a joint venture on the West Coast Mainline that will include the HS2 line.

FirstGroup’s shares have risen 4% to 130p after a continuous rise over the past year.

Best Binary Options Brokers 2020:
  • Binarium
    Binarium

    Best Choice!
    Free Trading Education!
    Free Demo Account!
    Big Sign-Up Bonus!

  • Binomo
    Binomo

    Good Choice For Experienced Traders!!!

Hargreaves Services (LSE: HSP) has also been positively impacted by the news of HS2’s progress. Hargreaves Services is the preferred supplier for many of the specialised earthworks set to take place between London and Birmingham for the new railway line.

Costain (LSE: COST) has had an order worth £1.1 billion on their books for the new high-speed railway line, along with more works with southern main, going some way to pick up the price of their shares.

Their shares previously dropped on the UK’s December 2020 election day after receiving their second profit warning in six months. Since then, Costain’s shares have rallied by 5%.

Keir (LSE: KIE) has received a boost since the HS2 decision was announced. Keir previously crashed to their lowest level in 20 years during 2020, however, there is £1.5 billion in their order book that has been counting on the approval of the HS2.

Balfour Beatty (LSE: BBY) secured a contract in September for the construction and delivery of the HS2’s Old Oak Common Station worth £1 billion, leading the recent confirmation of the project to be welcome news.

Go-Ahead Group (LSE: GOG) represents a further boost in transport shares beyond railways, growing an added 2% to 2,166p.

This rise has been due to the separate plans to funnel £5 billion into new buses, new bus routes and more frequent bus times.

Over two million passenger journeys are made using Go-Ahead buses each day, and the company is responsible for 11% of national services.

Overall, the news is looking good for the transport sector in the UK. Not only has the HS2 announcement caused a boost in engineering and transport shares, but a recent announcement of £170 million funding to electric buses, increased rural mobility and the trial of new Superbus services has no doubt positively impacted shares for the foreseeable future too.

HS2: How will it affect the UK’s biggest cities?

By 2033, the UK government hopes a new high-speed rail line will connect London with Birmingham, Manchester and Leeds. Anticipation for the High Speed Two (HS2) link is already having a huge effect, driving up investment and increasing property prices within the major cities along the planned route. Rail Industry Writer, Natalie Wilson, explores how HS2 will affect the UK’s biggest cities.

Leeds

Leeds is one of Yorkshire’s biggest cities and is sure to be a city to benefit the most with the arrival of HS2, increasing and improving the transport links to Birmingham, London and the East Midlands. Leeds is already a huge financial and legal hub, coming second only to London, and has a population exceeding 770,000. The city’s popular university will likely become an even more attractive place to live, study, work and commute from when, or if, HS2 is fully finalised.

This prospect is already having an impact on house prices in the area. According to recent research, house prices in Leeds are set to rise by around 10 per cent over the next five years. An increase in demand for homes to both buy and rent, coupled with the current shortage of available housing, is driving up house prices and rent across the region, including Bradford, Harrogate and York.

But not everyone in Leeds is happy about the HS2 proposal. In particular, those who live in the surrounding countryside, who are in fear that the greenbelt will be destroyed or their towns and villages swallowed up by the railway. A lot of the opposition in Leeds has been formed around the social and environmental impact that it may cause to surrounding villages and communities.

To try and avoid this, the government has set up a compensation scheme for those who find their properties being affected by HS2. Depending on the location of the property and which phase the homeowner may be affected by, some people may be able to sell their home to the government at its “unaffected” value or receive a lump-sum payment.

However, everything is still currently up in the air regarding the Leeds HS2 development. The supporters continue to promote the benefits of a nationwide rail scheme, whilst the critics continue to focus on the downsides. But it is in the interests of everyone to reach a conclusion either way.

Manchester

One of the original arguments for the HS2 scheme was to bridge the gap that sits between the north and south, to bring jobs, homes, investments and economic growth to cities other than London. The Northern Powerhouse and, in particular, Manchester became one of the key focal points for the Northern resurgence, along with other cities such as Leeds, Liverpool, Sheffield and Newcastle.

In recent years, Manchester has undergone some rather significant regeneration work and is now classed as the UK’s second city, a title previously held by Birmingham. Home to two huge universities, two of the world’s biggest football teams and one of the UK’s biggest shopping centres, there’s certainly a huge draw to the city.

With many key attractions, the city is a popular spot for international tourists. Furthermore, Manchester is renowned for engineering, science, culture, music and transport, with a long industrial history formed mainly from its integral role in the Industrial Revolution.

Manchester is known for being an appealing place to live, with bustling inner-city apartments and countryside detached homes on offer for a fraction of the price that you would find in London. Currently, the average asking price for a home in Manchester is £175,000, which is a huge appeal for first-time buyers and young professionals. With an efficient HS2 link, there is likely to be an increase in those looking to settle in Manchester permanently.

Manchester is a bustling and thriving cosmopolitan city which has the ability to compete with the biggest cities in the world. This is why Manchester is set to form such a huge part in the HS2 route, connecting London and the northern regions on a much bigger scale than previously seen.

When complete, the journey time from Manchester to London will decrease from 127 minutes to just 67. This huge reduction will mean that commuting to and from the capital will be quicker than the routes currently used for getting to Sheffield, Leeds and Liverpool.

Birmingham

The initial development of the HS2 line is focused on Curzon Street Station, Birmingham’s main train station, which is also undergoing revitalisation in order to serve as the main access hub for HS2 in the city. This redevelopment process alone has introduced a whole host of new jobs in the city. As well as this, it also acts as a vote of confidence and is a tangible example of a guarantee from the government to strengthen Birmingham.

As part of the plans for the city, HS2 will also join both contemporary and new developments, including Paradise Birmingham, Arena Central and the Birmingham Smithfield Project, which are a collection of projects that represent a new level of inward investment. Unsurprisingly, HS2 is also having a huge impact on property prices in Birmingham. The average house price in Birmingham is up by around eight per cent since 2020 and is set to rise further, meaning that buyers are jumping at the chance to buy in a location which is being seen as up and coming and affordable.

HS2 represents a new and exciting development for London commuters who are looking to escape the expensive hustle of the city with many flocking to Birmingham, turning the city into a commuter hotspot pretty much overnight. HS2 will slash the commute time between the capital and Birmingham to just 49 minutes, making the city a new and accessible work market for many professionals.

It isn’t a stretch to say that Birmingham and HS2 are already showing promising signs of starting a modernised ‘industrial revolution’. The city has already solidified the position of having one of the biggest professional, financial and business hubs in the UK, other than London. With Phase One of HS2 set to be complete by 2026, Birmingham will have quick and direct access to one of the biggest and most important cities in Europe, no doubt making it a hotspot for investors around the globe.

DfT examining HS2 impact following Heathrow judgement

The government is assessing the environmental impact of HS2 following last week’s judgement against the “unlawful” Heathrow expansion decision on the grounds of climate change.

Department for Transport (DfT) permanent secretary Bernadette Kelly said that discussions are ongoing to assess the impact of the judgement on HS2.

Kelly told parliament’s Public Accounts Committee (PAC): “We are still assessing what the consequences of that judgement are for the project delivery. It’s actually too early for me to say whether we think we will need to make wider changes in a number of areas.” She added that government departments are currently researching how HS2 fits into the government’s net-zero targets.

“This was happening anyway, but colleagues in the Department for Business, Energy and Industrial Strategy are looking at the treatment of carbon in project appraisal in the context of the government’s commitments on net zero. The Ministry of Housing, Communities and Local Government [is] also looking at planning consequences. There is work ongoing on a number of fronts, although it’s simply too early for me to report to the committee on the conclusions.”

Earlier this week it was revealed that a legal challenge is set to be launched against the construction of HS2 by broadcaster Chris Packham, over claims the project is incompatible with the government’s net-zero carbon emissions target. On Monday a DfT spokesman said the department understood green campaigners’ concerns, and have tasked HS2 leadership with “delivering the UK’s most environmentally responsible infrastructure projects”.

At the committee on Wednesday, MPs questioned HS2 director general Clive Maxwell on whether the project had previously carried out a quantifiable estimate to determine if the project is in line with the government’s climate change policies.

He said: “The business case for HS2 has for a long time considered the carbon benefits and the benefits of shifting to electric-powered trains versus other modes of transport, so there is a strong recognition in the business case for that.” Maxwell added that calculations on the volume of “mega-tonnes of carbon” involved in the project had been carried out and promised to send the details to the committee.

Kelly added: “HS2 will mean fewer journeys are taken by road and fewer journeys are taken by air. In broad terms, investing in rail is a way of ensuring that the transport system as a whole is more carbon efficient.”

Best Binary Options Brokers 2020:
  • Binarium
    Binarium

    Best Choice!
    Free Trading Education!
    Free Demo Account!
    Big Sign-Up Bonus!

  • Binomo
    Binomo

    Good Choice For Experienced Traders!!!

Like this post? Please share to your friends:
Binary Options Trading Guide
Leave a Reply

;-) :| :x :twisted: :smile: :shock: :sad: :roll: :razz: :oops: :o :mrgreen: :lol: :idea: :grin: :evil: :cry: :cool: :arrow: :???: :?: :!: