Strike-hit railway company Arriva Trains Northern has failed in its bid to continue running the Trans-pennine express services across the north of England.

The Strategic Rail Authority (SRA) has announced it is to consider two other companies to operate the routes.

Arriva had been in a three-way race with Connex Transport UK Limited and the First Group to run the services, which connect Tyneside to Merseyside, via Manchester and Yorkshire.

However, it will still be considered for the new Northern Rail route, which will amalgamate Arriva's other current north-based routes with those of train operator First North Western.

We believed our bid would have provided early and significant benefits for customers and good opportunities for employees

Arriva Trains Northern

John Bourn, spokesman for the North East branch of pressure group Rail Future, told BBC News Online: "There appears to have been a vote of no confidence in Arriva's management by the SRA.

"A year's industrial disruption, which still shows no sign of being solved, cannot have helped.

"The decision is not an enormous surprise, now we are still waiting for the SRA to make a final decision on the Trans-pennine route."

The SRA said the strikes had played no part in its decision.

Since January, conductors from the RMT union have been staging a serious of walkouts over a pay dispute, which still shows no sign of reaching agreement.

Arriva Trains Northern had promised to introduce 55 new trains if it won the franchise.

Franchise talks

But the Strategic Rail Authority has rejected their bid, and will now enter talks with the company to continue running Trans-pennine services until late 2003, when the new franchise comes into force.

An Arriva spokesman told BBC News Online: "Arriva is disappointed it has been unsuccessful in its bid for the Trans-pennine Express franchise.

"Arriva believed its bid would have provided early and significant benefits for customers and good opportunities for employees, whilst meeting the requirements of the Strategic Rail Authority."

The SRA has opened discussions with Arriva concerning the extension of the Arriva Trains Northern franchise to summer 2004, when it will hope to take over the new Northern Rail franchise.