M6 Toll - in debt and up for sale

The owners of the UK’s only pay-to-use motorway, the M6 Toll, have put the road up for sale in an attempt to recover £1.9bn of debt.

The international consortium of banks, including Crédit Agricole, Commerzbank and Banco Espirito Santo, that own the M6 Toll after taking control of the road from Macquarie in December 2013, have decided to sell their asset to try to pay down the debt on a road which has failed to match projected traffic numbers since it opened in 2003.

The 27-mile stretch of motorway that was designed to ease congestion on the main M6 in the West Midlands has failed to live up to expectations since opening in 2003.

It was originally forecast that 72,000 vehicles a day would use the 27-mile stretch of motorway that was designed to reduce congestion on the main M6 in the Midlands, however the daily average is around 48,000, with cars paying up to £5.50 and lorries up to £11.

The reduced traffic numbers and revenues would be bad enough, but the problems facing the road, which is operated by Macquarie subsidiary Midland Expressway, have been made worse by its debt. In total 27 banks and hedge funds own the M6 Toll and they hope that the sale of the road will fully recover their £1.9bn debt. 

Traffic numbers have been rising on the road in recent times with around 17.4m vehicles using it in 2015, a 12.6 per cent increase on the previous year and a higher increase than the national rise of 10.1 per cent. 

Midland Expressway has a contract to maintain and operate the toll road until 2054 but the sale is sure to reignite the current debate over how investment in the UK’s roads should be funded. While the government is keen on more toll roads to reduce congestion, recent attempts to introduce tolling have been opposed by motoring organisations.

Some observers say that the government’s recent announcement of a £15.2bn investment in the road network to be managed by Highways England, might have to be recalibrated as a number of projects are running late and are over budget. 

With the recent National Audit Office report into the progress of major projects painting a worrying picture of a third of all schemes on the Major Projects Portfolio being at risk of being ‘unachievable’, calls for a re-think of how such schemes are approached could gather pace.