The UK Department for Transport (DfT) has shortlisted two bidders for the contract to operate the South Western rail franchise from next June.
Current operator Stagecoach South West and First South Western Trains have submitted expressions of interest to bid for the franchise, which will run for seven to nine years with an option for a one-year extension.
Stagecoach currently operates the South Western rail franchise under the South West Trains brand.
UK Rail Minister Claire Perry said: "The South Western franchise has some of the busiest routes in the country, serving a diverse range of passengers and places.
"It is vital that we have the best partner to help us meet the challenge of delivering better journeys for all customers using these services.
"We are investing in additional capacity, and have ambitious plans for smart ticketing, customer service and improved connectivity across the South Western network, to give passengers real benefits across the region and beyond."
The current franchise covers urban, suburban, regional and long-distance routes between London Waterloo, Reading, Bristol, Exeter, Weymouth and Portsmouth, as well as the Island Line on the Isle of Wight.
Stagecoach has been operating the franchise since 1996.
Stagecoach chief executive Martin Griffiths said: "Our vision is for a railway that is more responsive, and built around each customer, their priorities and their communities.
"We look forward to working with local stakeholders on developing plans to tackle overcrowding, boost punctuality and deliver better, more connected and more accessible journeys."
The DfT’s public consultation on the specification for the new franchise is scheduled to end on 9 February.
Image: South West Trains 444001 approaches Clapham Junction. Photo: courtesy of Andrew Butcher via Wikipedia.