Dozens of jobs are at risk at the small businesses and food producers which supply the highly-acclaimed Wrexham & Shropshire railway company, which is to cease operating on Friday (January 28).

The firm, which provides Shropshire’s only direct rail link to London, with stops at Shrewsbury, Telford and Tamebridge Parkway in Walsall, blamed an “unprecedented economic environment” for the end of the line for the service.

Bosses said there was no prospect of the business reaching profitability even though the company, which launched in 2008, has worked to increase numbers on the service.

More than 50 jobs will be lost directly as a result of the closure, although alternative positions are being sought within the railway industry for those affected.

However the company, which is linked to Chiltern Railways, stressed that it was not insolvent and that all financial commitments would be met.

In an attempt to boost profits, the firm reduced services in 2009 from its original plan of five trains per day to four.

Two lightly used services were later combined to reduce the service to three trains per day in December.

A dispute with rival Virgin Trains prevented passengers from London disembarking at Wolverhampton, although they were able to join the service at the Black Country station.

Chairman Adrian Shooter said: “Regrettably, we have concluded that the potential for further changes to the company’s operations will not improve the financial position sufficiently.

“The shareholders have invested in excess of £13 million in launching the business and funding its losses, and have now concluded that there is no reasonable prospect that Wrexham & Shropshire can become profitable, or offer a return on this investment.”

The company has developed a reputation for excellence in customer service, which was rewarded in autumn 2010 with a 99 per cent customer satisfaction score in the benchmark National Passenger Survey.

But, despite strong growth in passenger numbers, the business has not been able to generate sufficient revenues to cover more than 65 per cent of the cost of operating the service and in 2010 alone suffered losses of £2.9 million.

Rival Virgin Trains has since started a service from Wrexham and now proposes a dedicated link to Shropshire.

Shropshire businessman Paul Belton, who regularly used the service created a 389-name petition to 10 Downing Street supporting it.

He claimed the demise of Wrexham & Shropshire would threaten scores of local businesses which supply the service’s food operation.

“The end of the line puts jobs at risk at suppliers across Shropshire. Virgin Trains should instead concentrate on the West Coast Main Line or lines with no direct link to London like Blackpool,” he said.

Mr Shooter added: “Even though we are forced to close the business, we remain extremely proud of what we have achieved with Wrexham & Shropshire with many stating that we set the standard for all other train companies to follow.

“I would like to pay tribute to everyone in the Wrexham & Shropshire team. Our people are the best in the business.”

All Wrexham & Shropshire tickets already purchased will be valid on alternative routes into London Euston operated by Arriva Trains Wales, London Midland and Virgin Trains, and from London Marylebone by Chiltern Railways.

* A former West Midlands transport chief is planning to lobby Chiltern Trains to extend its successful London-Midlands link to Walsall.

Former Walsall councillor Richard Worrall, who was chairman of West Midlands Passenger Transport Authority, wants a long-awaited inter-city link between Walsall and the capital.

His call follows the demise of the Wrexham & Shropshire service, which called at Tamebridge Parkway on the outskirts of the town.

Mr Worrall wants Chiltern Trains to extend trips from its present terminus at Birmingham Moor Street or Snow Hill to travel via the park and ride station and then on to Walsall town centre.

He said: “The Wrexham & Shropshire service set the standards that others should follow and provided an excellent facility for people living in Walsall and the north of Birmingham.

“Walsall is now the only major West Midlands town not served by a direct rail link to London.”

He urged Wrexham & Shropshire boss Adrian Shooter to consider starting and terminating Chiltern Trains London services back at Walsall, with a stop at Tamebridge Parkway.

Mr Worrall commented: “My main concern, from the Black Country perspective is, of course, to try and get Tamebridge Parkway back on the inter-city map and to get Walsall its long-awaited direct London service.

“Given the populous catchment area, I continue to believe that an attractive level and quality of service would not only bring great benefits to the people and the economy of the area, but also be a commercial success.”

The number of passengers using the Tamebridge Parkway station has risen from 130,000 in 2004 to almost 500,000 last year.

* A petition and campaign to save the Wrexham & Shropshire railway company has been set up here