More more in Bournemouth

Sunday 7th August 2022

Bournemouth’s buses dramatically changed colour yesterday following the sad news on Friday 29th July the town’s Yellow Buses had called in the Administrators. The company ceased trading less than a week later at 18:00 on Thursday 4th August leaving the town without its familiar bright yellow liveried buses all day on Friday for the first time for 120 years.

Fleet-of-foot morebus had a substantial replacement network up and running in record breaking time from first thing yesterday.

This blog tells the background story to how that happened.

We haven’t seen the likes of a sizeable bus operator fail in such dramatic fashion in 30 years. Not since National Welsh ceased trading in 1992. It’s a salutary lesson for those who think running a bus company is a sure fire way to make profits and I hope those calling for new municipally owned companies to be set up to stymie so called profiteering “bus barons” in the private sector are taking note.

Indeed the demise of Yellow Buses brings to an end a long history of municipal ownership stretching back to 1902 That ceased in 2005 when a majority 90% stake in the business was sold by Bournemouth Council to Transdev. Six years later in 2011 that ownership passed to RATP as part of a wider deal between the two French companies and in 2016 RATP bought the remaining 10% shareholding from the Council to become outright owners.

There then followed in January 2017 what with hindsight might now be regarded as the beginning of the end with RATP French based staff, rather than the locally based Yellow Buses team, overseeing a major network review, later largely aborted, which changed many long established routes and familiar route numbers.

Significant numbers of passengers and revenue were reportedly lost only partially returning when some of the changes were reversed; but by then it was too late. Morebus gained passengers and revenue from a significant misstep by RATP’s Yellow Buses.

As morebus edged further into what could be regarded traditionally as “Yellow Buses territory” the company responded by upping its own frequencies to protect its market share. But it probably responded too far resulting in prime corridors being over bussed even by its own service provision, let alone morebus routes as well. For example, the Christchurch to Bournemouth corridor enjoyed 15 buses per hour from Yellow Buses as well as morebus running its routes.

More recently RATP saw no future for the business and sold the company to its senior management team for a nominal sum in July 2019 together with the freehold of the company’s bus garage albeit that was sold on to fund a significant pension deficit – such are the joys of former municipal ownership.

Now it seems the harsh economic realities of running buses with recent relentlessly increasing inflation not least impacting diesel costs, staff resource issues, Covid subsidy support ending and not-yet-fully-recovered passenger levels have done for that team; and the company is no more.

On the face of it, it seems a strange time for a bus company that enjoys a substantial seasonal uplift with visitors and tourists to have gone under. You’d think peak August trading would at least cover short term cash flow requirements so it gives some idea of the dire state the finances must have been in that the company has ceased at this busy trading time and at such short notice – a matter of days. One suspects it must have been on the cards for a while, not least as replacement services arranged by Go-Ahead owned morebus have obviously been well prepared and on the starting grid, with timetables, driver schedules, rotas and impressive marketing information including an updated network map available online.

All this arguably should have been the outcome in 2005 when Bournemouth Council sold the majority shareholding of its bus company to Transdev. That was a mistake. It should have sold to Go-Ahead as the Group’s far sighted CEO Martin Ballinger sought to persuade the Council at the time.

That Transdev decision was never in the long term interests of residents and stakeholders of Bournemouth nor staff at the company. The limited geographic reach of the business hemmed in by the then Go-Ahead owned Wilts & Dorset (pre its morebus makeover) was never going to truly prosper.

As we’d shown in a very similar situation in Brighton and Hove in 1997 when the management and employee owners of Brighton Buses sold their former municipally owned company to Go-Ahead and we merged the business with Brighton & Hove, having one bus company serving a conurbation of around 250,000-300,000 population is far preferable to the inefficiencies of two companies competing in a constrained geographic market. The result was an attractive simple to understand network welcomed by passengers and stakeholders leading to sustained growth and the creation of more jobs and security of employment.

There’s no issue of anti-competitive monopolistic behaviour when the threat of competition in an open contestable market is ever present. And so it proved.

In those days the equivalent of today’s Competition and Markets Authority thankfully had the foresight to waive the merger through accepting those assumptions as well as noting the unwavering and strongly committed stakeholder and local political support.

Seventeen years later here we are with that sensible and practical outcome at last in place in Bournemouth from yesterday and the bonus for Go-Ahead is they haven’t had to pay anything for their newly acquired network.

There’s no doubt in the medium term there’s an opportunity for some pragmatic rationalisation with its own long standing network where duplication exists across the conurbation. For example Yellow Buses route 3 duplicated frequent morebus route m1 between Westbourne and the Royal Bournemouth Hospital so it makes sense to significantly reduce this in the new network, as indeed has happened. Wasteful over provision can now end and resources deployed instead into improving those routes with potential to grow in the coming months and years.

It was interesting to read Yellow Buses had been in talks with “a national operator” about an acquisition. It looks to me as though Go South Coast, the overarching company running morebus, with its well advanced plans and resources ready in place would naturally make any external-to-the-area acquirer think twice before shelling out money to buy a network already suffering financially and which could potentially have been subject to competition from morebus leading to significant instability. Not a particularly attractive proposition for say, a plc like National Express who were reportedly the potential suitor.

Who else would buy such an operation in the current state of the industry? The presence of Go-Ahead completely surrounding Yellow Buses would put off the likes of First and Stagecoach – Groups which haven’t made acquisitions for years and both dealing with aggressive bids for their own futures. Arriva is itself up for sale with no-one interested in buying it and referring back to NatEx, it recently disposed of its only bus company outside the West Midlands, Xplore Dundee, and indeed following its acquisition of Lucketts and its decision to take back in house the significant and margin enhancing express coach contracts previously operated on its behalf by Yellow Buses will have done nothing to steady the company’s financial position and was probably another significant factor leading to its demise.

Transdev Blazefield has a track record of expansion but only in their Yorkshire/Lancashire heartland while, as we’ve seen, parent Transdev already owned it once which just leaves Rotala seemingly the only listed company that sees buying bus companies as a sensible strategy in these challenging economic times. Just this week news broke of its acquisition of Midland Classic so it probably had its corporate hands full with that. Interestingly making for a trio of companies metamorphosing this week, HCT Group announced it’s Yorkshire based subsidiary Powells ceased trading at 17:00 on Friday with its significant tendered bus network being reallocated to other companies. It’s been quite a week.

The phrase “strong and stable” has never been further away from describing the bus industry in current times. Let alone in coming weeks and months. Yellow Buses and Powells will not be isolated cases, that’s for sure.

I paid a visit to Bournemouth yesterday to see how Day One for the new morebus network was panning out.

Staff made redundant from Yellow Buses were being actively recruited throughout Friday by the Go South Coast team so they were ready to go as best they could yesterday with staff familiar with the network.

Managing Director Andrew Wickham reported on social media he was “delighted so many people, sadly redundant from Yellow Buses, are joining us” at the morebus temporary Recruitment Centre set up at the Village Hotel in Bournemouth. Those attending on Friday and starting immediately received a £3,000 welcome bonus reducing to £2,000 for those joining yesterday.

This incentive worked a treat as did the hugely professional and substantial arrangements the Go South Coast team put in place to recruit staff on Friday and yesterday. I met up with both Andrew and Operations Director David Lee-Kong at the hotel as well as the recruitment team drawn from across the company including Southern Vectis, Bluestar, Swindon Buses and Salisbury Reds as well as morebus who were all still hard at work yesterday processing the tail end of the hundred or so applications.

To completely fill a rota comprising 94 vacant lines within 24 hours with every applicant duly processed through a professionally structured interview, independent assessment, job offer with contracts of employment issued followed by a full induction with employee handbooks and procedural guidance handed out and explained was a quite amazing achievement and I heartily congratulate the whole team for such an incredible effort.

The atmosphere created by the team in a suite of rooms at the Village Hotel was hugely impressive and I’m sure all the former Yellow Buses staff who attended were reassured they were joining a professionally run company with a secure future after the trauma of the last few days.

One potential employee moving to Bournemouth shortly and currently working for another bus company many miles away had applied to Yellow Buses for a job and not having heard back saw the news of the company’s demise with alarm so after his early turn drove for four hours to reach the hotel arriving just before Friday’s session ended at 18:00 to secure a job. With such dedication he was naturally successful and will be moving to Bournemouth later this month. This was just one of many individual stories that characterised the recruitment arrangements on Friday.

With enough drivers in place for the run out first thing yesterday morning – and it was by no means certain enough would apply – Andrew reported there was a real buzz from staff attending their first shift at the morebus Bournemouth garage (which was only rebuilt as recently as 2019 and can accommodate the extra fleet now needed), the next task was to have enough buses and ticketing equipment. The initial commercial network with some extra tenders taken on at the last minute once driver availability was confirmed calls for around 37 extra buses.

By good fortune the company has recently taken delivery of 15 new ADL buses ahead of expectations ready for routes operated for the University of Bournemouth this autumn. These are now being deployed on the traditional morebus network enabling the cascaded buses together with other buses from a reserve fleet to run the new network.

Longer term it’s envisaged more new buses will be acquired but in the meantime older buses in the normal course of events which would have been disposed of are continuing in service together with loans from within the Go South Coast area including Salisbury Reds and Eastleigh based Bluestar.

Andrew was out and about sampling the new network yesterday morning and it was an absolute pleasure to accompany him and see and hear first hand the positive comments from the former Yellow Buses staff we encountered, some with considerable service under the belt, as well as appreciative passengers.

It was also impressive to see every timetable case throughout the network had been updated on Friday displaying the new morebus departure times and the old Yellow Buses information removed.

Five teams had worked throughout the day to achieve this showing it can be done where there’s the will and commitment to do so. Longer term smart new backing sheets will be installed where once Yellow Buses branding prevailed.

Obviously bus stop plates will take longer to update and the Council have responsibility for some of these but full credit to BCP Council who played its part and had updated real time departures so the system was working with actual real times for the new network.

Seasonal customer service staff normally based in tourist hotspots such as Marina from Swanage have been redeployed to help and reassure passengers in Bournemouth Square to great effect.

On board buses were copies of the new timetables available for passengers to pick up albeit in a rudimentary format but remember all this happened with a matter of hours (not even days) notice and for that everyone involved deserves huge praise. Online information was all updated on Friday with new network maps displayed as well as timetables.

The whole exercise is a text book example of dealing with the unusual circumstances faced by the Go South Coast team. Bournemouth’s residents and former Yellow Buses staff are very lucky to have had the Go South Coast team’s unwavering commitment to make the new arrangements work with little or no disruption.

The future for buses across the conurbation has never looked better as opportunities for promoting one network come to the fore. Seventeen years on from that misstep of the sale to Transdev, the future is now a very positive one for bus travel in Bournemouth. It’s certainly sad to see the end of Yellow Buses but nostalgia (and the country’s current economic challenges) aside, it’s good to see within 36 hours buses are pretty much back to normal in Bournemouth and many passengers unaffected.

I’ll conclude by observing all that’s been miraculously achieved in such a short time is a consequence of the devolved nature of Go-Ahead’s management structure enabling truly empowered managing directors and inspirational locally based autonomous teams to make decisions quickly and enact them rather than a centralised corporate monolith where decisions get passed up a chain of command for approval only to never return back down again.

Well done to Andrew and his team. A brilliant effort by all concerned. Bournemouth’s buses are in safe hands and I look forward to reporting on future developments.

Roger French

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