FirstGroup win InterCity West Coast Franchise

[whole diary]

[Btline]

This interesting document has many further details.

Including the shocking facts that only 4% of money comes from commuters and that two thirds of seats are EMPTY.

Also shocking that they only have 20% of market share for London - Brum.

http://www.firstgroup.com/assets/pdfs/investors/presentations/InterCity_West_Coast_franchise_award_presentation_150812.pdf

[Btline]

First have confirmed that buffet cars will be kept.
Catering staff will RISE.
"In-seat dining" introduced.

Source: Radio 4

[JayMac]

What's shocking about a long distance operator only having a small commuter income?

And it's 20% of modal share, not market share. There's a difference.

[ellendune]

....and that two thirds of seats are EMPTY.

that obviously gives them opportunities for growth.  But what is the equivalent figure on FGW^▸ (First Great Western)?  More than you think I expect.

Also shocking that they only have 20% of market share for London - Brum.

If I were a long distance operator too many passengers filling my trains for a short leg that stopped others paying for longer journeys would be a problem.

[JayMac]

Virgin Trains CEO^▸ (Chief Executive Officer) Tony Collins' video announcement to staff:

http://www.youtube.com/watch?v=_H3okjq5KB0&feature=plcp

[grahame]

....and that two thirds of seats are EMPTY.

that obviously gives them opportunities for growth.  But what is the equivalent figure on FGW^▸ (First Great Western)?  More than you think I expect.

Also shocking that they only have 20% of market share for London - Brum.

If I were a long distance operator too many passengers filling my trains for a short leg that stopped others paying for longer journeys would be a problem.

What the typical commuting customer sees the loading to be and the actual figures differ.

Let's take a fictitious case of the commuter airline operation around Swinetown.  Every morning, a flight leaves at 06:15 for Midshire and Wildberry, returning via Midshire to Swinetown at 07:45.  In the evening, it makes a second round trip from 18:45, getting back at 20:15.

There are 50 seats on the plane; 40 of them are occupied into Swinetown in the morning, with 15 customers from Wildberry and 25 from Midshire. So commuters who you ask will tend to tell you that the service is "always nearly full".  What they don't realise is that the 06:15 flight conveys just 2 customers from Swinetown at 06:15, rising to 5 from Midshire to Wildberry.   True loading is not the 80% commonly reported, but 31%.

Let's look deeper.

If you start looking at the Midshire to Wildberry section, you find loading of just 20% ... but cut the service back to being just Swinetown to Midshire and that service then loads to only 27% rather than the 42% loading it previously had because of the extra whole-route traffic from Wildberry up to Swinetown.

Getting better utilisation?  If you can get "other way" traffic, that would be great.  If Wildberry is purely a dormitary town with no ongoing connecting flights and no leisure opportunities, you have a problem.  But if you've got ongoing connections at Wildberry to take people from Midshire places like  Bigcity, and Sallyberry, you'll be able to fill a few extra seats.  And you'll fill significant extra numbers if you run that 90 minute round trip every 2 hours through the day - you'll make for far better use of the expensive resource of the plane, and you'll give lots more journey opportunities - not just 11 hours in Swinetown, but also 2 x 9 hour opportunities, numerous 7 hour opportunities, etc.. People who aren't sure of their return time will be able to use it too, as there will be "another one in a couple of hours" if they get held up at work, or if they've taken a day trip to Wildberry and so enjoyed walking in the countryside near there (famous for its white horses) that they want to come back later.

I'll believe the 33% loading quoted.  It's possible to get it higher, but I would be very surprised to see it over 50% very often anywhere.  Playing with scenarios leads to some very interesting data about the future direction services could take;  its shows the importance of operations like rail partnerships and promotions to fill offpeak and otherway seats, the significance of both-way flows, and (at time depressingly) the effect of a three month summer season. Thank goodness that people want to travel from Wildberry and Midshire to Swinetoen, Bigcity and Sallyberry all year 

[JayMac]

I think I may live in Bigcity. Travelling to Swinetown (some may argue - appropriate name  ) or Wildberry is relatively easy for me.

Midshire though is nigh on impossible for me to get to and from. 

[broadgage]

Nothing much about catering.

Is the shop being axed? it says something like "at seat catering for all customers"...
They could do a XC^▸ (Cross Country Trains (franchise)), put luggage racks there and then rip them out in the saloons.
No mention of restaurants or travelling chefs (probs because they are not viable/profitable).

Hpefully they will run some proper restaurants.
The cynic in me is however aware that a sandwich sold from a trolley is "at seat catering"
Almost any downgrade or reduction can be marketed as an improvement, if you have a good marketing department.

Squeezing in a few more seats by removing tables " thousands of extra seats a day. customers much prefer new layout, surveys show it"

Remove the restaurant/buffet, a great impovement "customers much prefer a trolley service, surveys show it"

[Andy W]

[

What the typical commuting customer sees the loading to be and the actual figures differ.

Let's take a fictitious case of the commuter airline operation around Swinetown.  Every morning, a flight leaves at 06:15 for Midshire and Wildberry, returning via Midshire to Swinetown at 07:45.  In the evening, it makes a second round trip from 18:45, getting back at 20:15.

There are 50 seats on the plane; 40 of them are occupied into Swinetown in the morning, with 15 customers from Wildberry and 25 from Midshire. So commuters who you ask will tend to tell you that the service is "always nearly full".  What they don't realise is that the 06:15 flight conveys just 2 customers from Swinetown at 06:15, rising to 5 from Midshire to Wildberry.   True loading is not the 80% commonly reported, but 31%.

Let's look deeper.

If you start looking at the Midshire to Wildberry section, you find loading of just 20% ... but cut the service back to being just Swinetown to Midshire and that service then loads to only 27% rather than the 42% loading it previously had because of the extra whole-route traffic from Wildberry up to Swinetown.

Getting better utilisation?  If you can get "other way" traffic, that would be great.  If Wildberry is purely a dormitary town with no ongoing connecting flights and no leisure opportunities, you have a problem.  But if you've got ongoing connections at Wildberry to take people from Midshire places like  Bigcity, and Sallyberry, you'll be able to fill a few extra seats.  And you'll fill significant extra numbers if you run that 90 minute round trip every 2 hours through the day - you'll make for far better use of the expensive resource of the plane, and you'll give lots more journey opportunities - not just 11 hours in Swinetown, but also 2 x 9 hour opportunities, numerous 7 hour opportunities, etc.. People who aren't sure of their return time will be able to use it too, as there will be "another one in a couple of hours" if they get held up at work, or if they've taken a day trip to Wildberry and so enjoyed walking in the countryside near there (famous for its white horses) that they want to come back later.

I'll believe the 33% loading quoted.  It's possible to get it higher, but I would be very surprised to see it over 50% very often anywhere.  Playing with scenarios leads to some very interesting data about the future direction services could take;  its shows the importance of operations like rail partnerships and promotions to fill offpeak and otherway seats, the significance of both-way flows, and (at time depressingly) the effect of a three month summer season. Thank goodness that people want to travel from Wildberry and Midshire to Swinetoen, Bigcity and Sallyberry all year 

Of course you could park the plane at Swineton after the morning flight returning in the evening, saving landing fees, fuel, etc. Then you would get back to 80% loading.

[onthecushions]

I'd back First Group on this.

The WCML^▸ (West Coast Main Line) was always the biggest market on BR^▸ (British Rail(ways)), with Manchester leading. Also rail is underused in the regions compared to L&SE.

Tim O'Toole also is a proper railwayman, both a businessman and operator, with US experience as well as LUL^▸ (London Underground Ltd). He understands the PPP nonsense and has tangled with DfT^» (Department for Transport - about) before.

We may not love them but if their trains are full and they do what it says on the TT.......

OTC

[Andy W]

http://www.firstgroup.com/assets/pdfs/investors/presentations/InterCity_West_Coast_franchise_award_presentation_150812.pdf

Interesting document BTline - without being too sceptical

"Transforming the on-board environment with a major refurbishment of Pendolino and Voyager interiors with new seats throughout and improved luggage space"

Given the HST^▸ (High Speed Train) "transformation" I would say their track record on this is at best questionable.

The whole - more of everything for everyone is frankly hogwash. I am no Virgin lover (4 kids proves that ) but the concept that First have done a better job on the Great Western than Virgin have on the WCML^▸ (West Coast Main Line) is at best questionable. The Great Western is virutally the same as when First took it over. Correct me if I'm wrong but the only new rolling stock is the 180s (says it all).Virgin have migrated the loco / DVT^‡(resolve) stock they inherited to the Pendilinos. Not perfect (the grumpy old man in me likes the old Mk3s) but journey times have come down. In FGW^▸ (First Great Western) land (certainly in the Cotswolds) times have increased.

I agree that Virgin could have done better, the Voyagers were to small and have their issues but at least they work!!

So quicker journey times, more luggage accomodation ... yeah,yeah,yeah - track record says BS.

[grahame]

Of course you could park the plane at Swineton after the morning flight returning in the evening, saving landing fees, fuel, etc. Then you would get back to 80% loading.

Err ... 55%, I think. 

[broadgage]

Yes, I would back First as well.
I have misgivings about First, but on balance would prefer them to Virgin.

Virgin services allways feel subjectively like a not very good airline, rather than like a railway.
Being told where to sit, and the included but not very good reheated airline type meal is part of this.

Some Virgin fares seem outrageuos, on not very busy trains.
I can understand charging relatively high fares on busy services, but last minute travel on lightly used services seems unduly expensive.

As an example the off peak fare from Taunton to London is about ^40, with tickets available at the last minute, and valid on any off peak train.
I suspect that a last minute off peak journey on Virgin, of similar length, would cost much more.

[Andy W]

Of course you could park the plane at Swineton after the morning flight returning in the evening, saving landing fees, fuel, etc. Then you would get back to 80% loading.

Err ... 55%, I think. 

Actually I blew it - should have said leave plane at Wildberry overnight - so comprehensively wrong !!!!   

[grahame]

...  should have said leave plane at Wildberry overnight ...

The loading percentages are only a part of the story, though.  They're what I was highlighting in my earlier post, because that was what the previous posts were on about - and the fact that most people think services are far busier that they really are, because most people are around at the times the services are busy.

The next measure you want to look at is your use of your valuable investment (in this case your plane) and having in make at least some money rather than sitting idle during the day, and how to make best use of staff too.  Whereever they're based, what are they going to do in Swineton for 11 hours each day, or are you going to need multiple sets of staff because of shift limits?   If so, how do you get them back and forth, or are they going to lodge away?   I'm getting way off topic here, though ...