Edinburgh Trams Report £64 Million Loss Despite Record Passengers

Edinburgh Trams recorded a staggering net loss of nearly £10 million in the financial year ending in 2024, despite achieving record passenger numbers. Financial accounts reveal a net loss of £9,645,644 for the year, contributing to total losses exceeding £64 million since the service began operations. This marks the seventh consecutive year in which the tram service has failed to turn a profit.

The tram network generated revenue of £28,815,444 during this record-breaking year, with passenger numbers surpassing 12 million for the first time. Notably, on June 8, a day when international pop star Taylor Swift performed at Murrayfield Stadium, the trams experienced their highest daily traffic with 74,401 passengers. Over the course of her three-day Eras tour, more than 250,000 individuals utilized the tram service, marking a significant operational achievement for the company.

Record Growth Yet Persistent Losses

The past year also marked the first full calendar year of operation for the tram line connecting Edinburgh Airport to Newhaven. This extension contributed to a 31 percent increase in passenger numbers compared to 2023. Additionally, the tram service facilitated travel for an extra 30,000 passengers to the Royal Highland Centre, while departures from the airport rose by 7 percent to just over 1 million.

Despite these gains, Edinburgh Trams has not reported a profit since 2017. The financial history of the service reveals losses of £7.62 million, £9 million, £8.8 million, £8.7 million, £10.9 million, £10.3 million, and now £9.6 million over the past seven years. The service has only registered profits twice since it opened a decade ago, with figures of £250,000 in 2016 and £1.6 million in 2017.

A significant factor in these ongoing losses is the annual asset fee of £8.5 million imposed by Edinburgh City Council since 2018. This fee was introduced to reflect the increased borrowing costs resulting from budget overruns on the original tram line. Cumulatively, this fee has accounted for £59.5 million of the losses since 2017.

Political Reactions and Future Plans

The financial situation has drawn criticism from local politicians. Sue Webber, transport spokeswoman for the Scottish Conservatives and a Member of the Scottish Parliament for the Lothians, expressed concern over the losses. “These staggering losses will be a bitter pill to swallow for Edinburgh residents who were already hit with a final bill of over £1 billion for the tram project,” she stated. Webber emphasized that taxpayers were led to believe the project would eventually become self-sustaining, yet it continues to incur significant financial shortfalls. She has called for accountability from both the Scottish National Party (SNP) and Labour politicians involved in the project’s management.

In contrast, Stephen Jenkinson, convener of transport and environment at Edinburgh City Council, defended the tram service. He highlighted that the trams offer some of the most affordable fares in the country and received recognition as the UK’s transport operator of the year at the National Transport Awards 2024. Jenkinson stated, “Our aim is to improve connectivity and encourage a shift away from private car use to more sustainable transport options.”

Looking ahead, the council plans to expand the tram network further. A consultation is set to launch next month to discuss a proposed north-south tram line connecting Granton and Edinburgh Royal Infirmary. Jenkinson noted, “This development is key if we’re going to deal with the challenges of our growing city and wider region in future years.” With Edinburgh’s population projected to increase by over 60,000 in the next two decades, investment in public transport is deemed crucial for the city’s sustainable growth.