Birmingham tram line has never made profit

Originally it was expected eight million passengers would be using the trams each year, but only about five million do so.

Trams running from Birmingham to Wolverhampton have not made a profit in the 17 years since the line opened, accounts seen by the BBC have revealed.

National Express, which runs the Midland Metro, has lost about £34m on the route since 1999.

The news comes days before an extension to New Street is set to open.

The company said it had expected people to make fewer long journeys and more short journeys, which would have brought in more money in fares.

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Originally it was expected eight million passengers would be using the trams each year, but only about five million do so. About 85 million passengers have used the service since 1999.

Further lines to Edgbaston and Centenary Square are planned once the latest scheme, costing £128m, has opened.

The transport operator hopes to have more than nine million passengers using the expanded network by 2026.

Director Martin Hancock said the loss had helped the company gain experience bidding for work in other countries.

"The existing line between Birmingham and Wolverhampton is an important part of the public transport network," he said.

Jonathan Cheetham, chairman of Retail Birmingham, said the "extremely complicated" building work "has not been easy for anyone", but he hoped the work would help businesses in Birmingham.

"In a city of this size, it's imperative that we've got a great transport network," he said.

'One isolated line'

"Investors from abroad, which we've seen a lot of recently, know and understand how important transport is."

Dr Pat Hanlon, senior transport economics lecturer at the University of Birmingham, said it was "not surprising" the line had been losing money and added developing a network was "the crucial factor" in making it profitable.

He said: "There's a bigger role for things like trams in this city, because an underground railway doesn't look as if it's ever going to be a feasible proposition - it's going to be far too expensive.

"If you've only got one isolated line, people don't get in the habit of using trams, they hardly know that they are there."

Midland Metro trams have run between Snow Hill, in Birmingham, to Wolverhampton since 1999