Formation In October 1986, to comply with the
Transport Act 1985, the bus operations of the
Tyne and Wear Passenger Transport Executive were transferred to a new legal entity named Busways Travel Services. bodied
Leyland Atlantean at the 2009
MetroCentre Bus Rally Busways divided its main services into four colour-coded divisions. Services operated out of
Slatyford and
Byker depots were branded as Newcastle and City Busways respectively, taking on a maroon livery, while
South Shields and
Sunderland depots' Busways operations were branded blue and green respectively. These divisions were eventually reduced to three with the merger of City Busways into Newcastle Busways in 1993. White-painted
minibuses operated by each division were branded "Mini Busways" to allow them to be quickly transferred between divisions, while low-cost subsidiaries, such as Blue Bus, Economic and The Favourite, were also set up by Busways to compete with rival operators, such as Trimdon Motor Services,
Go-Ahead Northern, the Tyne and Wear Omnibus Company (TWOC) and Welcome Passenger Service, on services across Tyne and Wear for passengers. In May 1989, Busways Travel Services was sold to its employees in an
employee share ownership plan (ESOP), with management owning 51% of shares and employees owning 49%. The newly privatised Busways made their first acquisition of a competing bus operator on 17 November 1989, purchasing the Tyne & Wear Omnibus Company, which had then recently been engaged in a
bus war with Busways, from Go-Ahead Northern for £2 million (). The sale of the Tyne and Wear Omnibus Company to Busways proved highly controversial with TWOC's 187 workers, with the company's Gateshead depot announced to close and workers being issued "precautionary" 90-day redundancy notices, before later being made to apply for new jobs at Busways; only two workers out of 33 applicants would get engineering jobs at Busways, while no ex-TWOC drivers were hired by Busways to operate former TWOC services. This eventually resulted in Busways being ruled to have
unfairly dismissed TWOC workers by an
industrial tribunal in June 1992. By March 1994, the company was considering options of geographic expansion, merger, acquisition or sale to a national group. The company had become concerned at its proximity to the recently floated
Go-Ahead Group, and the fact that
United Automobile Services to the south, and Northumbria to the north, were also possible targets for the larger groups. It believed that independently it would struggle to defend the company against expansion by these neighbours in the future. The Busways board came to the conclusion that a merger with one of the larger groups was the only viable option.
Stagecoach ownership corporate livery with Busways fleet names
Stagecoach Holdings acquired Busways Travel Services for £27.5 million () in July 1994. This takeover had to be accepted against two other national groups by Busways' 1,700 employee shareholders, 99% of which accepted, receiving between £4,700 () and £13,800 () in
windfall gains based on their length of service. Similar to Stagecoach subsidiaries such as
Cleveland Transit and
GM Buses South, Busways initially retained its identity as an autonomous unit of the group between 1994 and 1995, with the fleet carrying new straplines reading 'Part of the Stagecoach Group'. This rebrand was accelerated with a £6 million () investment in 40 Alexander RL bodied
Volvo Olympians and 17
Alexander PS type bodied
Volvo B10Ms that were delivered between late 1995 and early 1996, the largest single purchase of new vehicles by Busways since deregulation. The Busways, Economic and Blue Bus names were eventually dropped with rebranding of the Stagecoach Group in 2000, with operations continuing under
Stagecoach North East. The Busways name is retained today as the registered company name for the Stagecoach subsidiary.
Darlington Bus War involvement In January 1994, employee owned Busways had been considering expanding in the Darlington area, although by March this study was suspended while other possible futures were being considered. In the months following the Stagecoach takeover, the Busways subsidiary was a key player in the
Darlington Bus War. ==Operations==