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The tramway was introduced to Neath in 1873 with the formation of the Neath & District Tramways Company and the laying of a line from Villiers Street in Briton Ferry along the main road through Neath to the Terminus Hotel at Skewen. A horse-drawn service came into operation in 1875. The company was purchased by the Neath Corporation for the sum of £8,475 on 7 August 1896, at which time it was decided to replace horses with vehicles powered by town gas. These were purchased second-hand from a variety of sources including Lytham St Anne's, Blackpool, Lancashire.

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