Sunday 27th October 2024
Hot off the press, this latest book published last week and written by renowned industry expert Chris Cheek is a must read for anyone with a serious interest in the future of the bus industry.
As its title (which adds the strap line “The Opportunities and Threats”) conveys, the book provides a timely analysis of the seismic changes Britain’s buses are facing in a post Covid era with a new Government intending to build on its predecessor’s policy of offering new opportunities from a regulated operating model incorporating greater public control of networks, bringing an end to exactly 38 years of full blown deregulation, ironically, marked this very weekend.
I first met Chris nigh on 50 years ago, well before any thoughts of a deregulated world for the bus industry, when we both worked at the nationalised West Riding bus company based in Wakefield and over subsequent years have never failed to be impressed with his extensive knowledge and ability to assimilate facts and figures on which to base assessments and conclusions.
The Bus Industry Monitor project he has overseen since deregulation is testament to his passion for fact finding and analysis and it will come as no surprise to readers of his latest publication it comes with forensic analysis of facts and data from which he draws unarguable logical conclusions.
Much debate and at times heated discussions about the merits or otherwise of deregulation versus public ownership and control have dominated the last few decades. Chris identifies four key tasks to deliver the improvements we all want to see – improved reliability, increased service levels, fleet decarbonisation and modal shift to net zero backed by facts, data and analysis for the period 2010 to 2023.
The book’s 128 pages contain many tables, graphs and diagrams to convey the facts but please don’t think that means it’ll make for a tedious read with eyes glazing over all the data. Chris’s very readable writing style explains the key facts lucidly in descriptive contextualised text bringing the data in informative tables to life. Indeed the tables are a revelation demonstrating clearly established trends over the last couple of decades.
And what gold nuggets of data the book contains. Where else can you find details and analysis of bus industry income; bus operating costs; commercial/tendered proportions of kilometres run; patronage by type of passenger; local bus operating margins by sector; fleet replacement needs as at 2023; BSIP allocations showing each tranche of funding by every local authority; worked examples of sustainable profits; real term changes in bus fare levels and many more, all in one place?
Whenever Chris has come to make a presentation to Young Bus Professionals’ conferences I’ve always been amazed how he can mine the various available data sources such as at the DfT, the Scottish and Welsh Governments, the National Travel Survey, TfL along with many others and bring them all together into a digestible and concise assessment of the state of the industry as it really is. He’s done exactly that in this book.
I won’t use this blog as a spoiler for Chris’s authoritative conclusions, as you need to buy the book for that, but will just offer a few teasers to convey the revelatory nature of where the industry is currently positioned and the “opportunities and threats ahead”.
As part of the rationale behind writing the book Chris told me “I was particularly keen to put some numbers on things – including especially the cost of zero-emission buses and what it would take to restore networks to something like previous levels”.
Chris advises “new legislation alone will not improve outcomes without the funding to go with it” which has never been more pertinent in the context of this week’s well trailed Budget in what we’ve all been warned are the most challenging of financial circumstances faced by the country at the same time as Metro Mayors are making their plans and chomping at the bit to “take back control” of buses when what seems to be missing is a proper and publicly available assessment of the financial implications facing the industry.
Chris has now filled this void admirably. Here are just a few gems.
“If a target of 100% zero emission buses by 2035 is to be reached, it creates a need for some 26,000 new zero-emission buses to be delivered by 2035, at a total cost we estimate to be around £13.7 billion – £9.8 billion in the markets outside London and another £3.8 billion for the capital.”
“Increasing service levels to meet accessibility needs and customer aspirations requires upfront funding, even if patronage growth could over time reduce the costs or even eventually make them self funding. The operating costs vary from a relatively modest £310 million a year to extend the operating day of one hour outside London, through £1.6 billion a year to get the network back to pre-Covid levels, right up to £2.7 billion a year to restore all the cuts made since 2010. This option would also come with a capital expenditure requirement of between £3.0 and £3.8 billion to provide the necessary vehicles.”
Startling facts continue as Chris paints the picture for the period from 2010 to 2023. Bus industry income outside the capital fell by 24% in real terms …. service provision fell by 27.7% …. cuts in the supported networks were even greater, at 49.8% and this figure rose to over 60% in some areas of the English Shires …. service levels run commercially fell by 20.7% …. passenger volumes fell by almost one-third across Great Britain outside London, whilst the capital lost one fifth of its patronage … Wales saw the biggest drop, with a 47.8% fall …. and there’s much more with Chris explaining the background to the wide variety of reasons leading to these rather depressing statistics.
I finished reading that section of the book thinking with the public sector in many of the large conurbations so eager to take on the financial risks of running buses it’s little wonder against those trends why the bigger operators have come round to thinking the way forward to achieve certainty in profit levels is to win contracts with a sustainable guaranteed margin built in and not have to worry any more about passenger numbers.
Chris quotes from a fascinating paper by Professor Gwilliam presented to a conference in Sydney, Australia in 2008 entitled “Bus Transport: is there a Regulatory Cycle?”. Professor Gwilliam was a non-executive director of the National Bus Company from 1978 until 1984 and having carried out a global study of industrialised and developing countries concluded there was indeed such a cycle.
His analysis includes a long term review of the UK bus industry noting the period 1919 to 1949 saw competitive supply move through increasing consolidation, the involvement of the ‘big four’ railway companies to local private sector monopolies delivered by the 1930 Road Traffic Act and then nationalisation with the cycle commencing again with the 1985 Act bringing in a new round of competitive supply, re-consolidation into the five ‘big groups’ leading to private sector area monopolies promoting new legislation in 2000. 2008 and 2017 and Enhanced Partnerships and Franchising creating the regulated private monopolies that form stage three of the cycle while in London, Mayor Khan has referenced the first signs of re-nationalisation bringing bus operations back in house and local authorities permitted to own bus companies again.
Chris wryly observes “on this basis, maybe we can expect the next era of deregulation to begin somewhere around 2050”.
Not wanting to end on a morbid note but it’s highly unlikely Chris or I will be around to see 2050 but those that are will have the benefit of Chris’s book to show the historical context of the challenging financial state the industry faced in 2024.
But only if you buy a copy.
So don’t miss out. It costs just £25 and is available on line from the passtrans.co.uk publications website.
Roger French
Blogging timetable: 06:00 TThS
Comments on today’s blog are welcome but please keep them relevant to the blog topic, avoid personal insults and add your name (or an identifier). Thank you.
BusAndTrainUser 
An integrated public transport network is in my view essential. If we take London the Underground really become a success when it was integrated into a single cohesive network
The current bus network outside of London is a mess, The network of competing operator and service instability is simply not working as can be seen by the ever declining services
Will it change? Well there seems little sign that they will. BSIP funding has probably slowed the decline down a bit but that all it has done
The problem with electric buses is the very high costs, Currently the government subsidizes about 50% of he costs but that cannot go on for ever and electic bus costs are still increasing
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I don’t know if anon 07:27 has been keeping tabs on the bus industry. London bus patronage has been falling for years, the fleet reduced, routes being lost (except where the Superloop was introduced as a sop to the anti-ULEZ brigade) and subsidies increasing. All this since the high water point of 2014/5. Aside from the odd skirmish (e.g. Tamworth to Lichfield), there’s little wasteful competition.
As for the issue of electric buses, the current ZEBRA programmes are aimed at making that switch so that electric buses achieve critical mass and the charging infrastructure is put in. Once that happens, the commercial model of bus operation changes from “relatively” low capital spend and ongoing fuel and maintenance being a significant cost to a higher capital purchase price and lower ongoing operating costs.
BW2
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I think two reasons behind falls in London bus patronage are a reduction in bus speeds, and more people cycling. For many journeys it’s probably quicker to cycle thanks to all the new bike lanes on main roads and modal filters in low traffic neighbourhoods.
Peter Brown
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@Peter Brown – I think the fall in patronage in London does indeed track very closely with the fall in average bus speed.
It is all very well for @BW2 to cherry pick a high-water mark, but that ignores the successful growth in London over many years which led up to that, compared to ongoing decline elsewhere. If I choose 1986, as the point of divergence (the rest of the country was deregulated, London remained regulated and was in the early stages of tendering):
Even after Covid, London patronage is currently 53% higher than in 1986. In contrast, the rest of England is 56% lower.
If you do want to use 2014/15 as the benchmark, patronage in London is 26% lower. How does that compare to the rest of England? In the rest of England, which was not at a high water mark, patronage is 29% lower. So the decline in London is slightly less than in the rest of England.
Malc M
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My initial perception when glancing at the picture was a blog about the soon to be published book on Lothians excellent super size Enviros.
The reality looks just as interesting and a worthwhile buy.
When the previous Labour government was elected the bus was going to be transformed a workhorse into a thoroughbred.
Boris was going to Bus Back Better with piecemeal BSIPs. I sampled the reality of this yesterday with free travel on some buses in Leicestershire on Saturdays until Christmas. The Driver of a Centrebus I caught tried admirably tried to explain this poorly advertised initiative to bemused travellers.
Buses need to be seen as safe, reliable and convenient. The latter has been affected by Public Realm initiatives where the industrys voice is week.
I challange peoples minds by asking “Will the bus become the barge of the 21st century”. Or will it ultimately be used only for leisure. After all there will always be a need for tourist buses in cities like Edinburgh.
It will be interesting to see Chris’s view on how the bus will remain relevant in a changing world.
John Nicholas
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https://www.choosehowyoumove.co.uk/public-transport/enhanced-bus-partnerships/leicestershire-buses/schemes-and-projects/leicestershire-ticketing-schemes/free-fare-super-saturdays/
As can be seen from information in the link above, the free Saturday travel initiative, for journeys commencing or ending in Leicestershire, is until November 30th and not until Christmas.
I would agree that on the whole it isn’t all that well advertised; the bus industry is, as a whole, far too insular. It expects people to go looking for information rather than presenting the information to people. That said, and as you’ve mentioned Centrebus, parts of their service 154 in Leicestershire have had posters put up in bus shelters in places like Thurcaston, Cropston, Woodhouse Eaves, Woodhouse, Quorn and Baxter Gate in Loughborough. Some Centrebus vehicles have posters on their cab bulkhead walls too.
N.P. Beasley.
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Rachel Reeves tipped for £2 bus cap cut as fares set to quadruple after Budget
A total withdrawal of fares support will be very damaging. Moving to a simple 3 or 4 band fare system would be lower cost sand more sensible. At present though it is just rumours so who knows
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Kier Starmer announced at noon that capped fare will be £3 until 2025.
https://www.theguardian.com/politics/2024/oct/28/englands-bus-fare-cap-will-rise-from-2-to-3-in-2025-says-starmer
Still excellent value on long distance journeys using multiple operators in areas where day tickets don’t cross county lines or are unavailable on other operators services.
The south east has the Discovery Ticket priced £10. This gets little or no marketing unlike the previous 1970s Wanderbus ticket whose area of validity was advertised by Maidstone and District in every bus, the back of of timetables and even as an overall advert bus belonging to Gillingham which it loaned to other garages.
The striking map of southern England’s core inter urban routes covered an area not dissimilar to Transport for South East.
All for 60p (£3.93 in 2024 prices).
A day’s travel in 1976 .. Still less than a journey in 2025.
John Nicholas
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Seems to explain to my wonder why the big groups could let it’s network to be nationalised in the big cities. From the quote from Chris’s book, the long term prospective of profitability is dim, securing stable profit as a contractor operator may sound more proven.
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Can we kill the myth of ‘sustainable guaranteed margin’ A franchise contract exposes the operator to cost risks without any ability to alter income or volume. Not only are there the normal cost risks such as wages and fuel( which of course can be hedged) but other unknowns such as 2% increase in employers NI, 5p or more increase in fuel duty, above inflation increase in minimum wage, sick pay from day one etc.
A franchise contract is a high risk commitment, only for the well financed or stupid operator, as some rail franchisees and the likes of Serco in other industries have found out, or virtually all London Operators who lost collectively, I am told, £62m in the last reported financial year.
In the real world the cost of batteries for electric vehicles has halved in the past 12 months but whilst that’s reflected in the reduced price of cars that has not been reflected in the price of buses because as there is the Zebra subsidy it encourages the manufacturers to keep prices high. Current profit margins are about £100,000 per bus, and no doubt every Chinese bus sold in the U.K. considerably benefits the Chinese Exchequer .
If the Zebra subsidy ends manufacturers will have to price their products competitively to survive, and the cost of an electric bus should equate with the cost of a diesel bus within 5 years. Wether U.K. manufacturers survive will be a moot point, with their current products not meeting the quality of imports .
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There has been a recent change amongst the large bus operators. They have been buying up coach companies. In the past they tendered to be only interested in any bus operation these companies had and divested themselves of the coaching operations, Recently though both GoAhead and First Bus have been busy buying up coach companies
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Stephensons and NIBS parent sold to employee ownership trust
Mr Hiron remains Chairman of the business under its new structure as part of a leadership team that is largely unchanged. Managing Director Dean Robbie and Finance Director Gary Raven hold their positions, and Mark Sayer steps up to the newly created role of Engineering Director. He was previously Fleet Engineer.
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IIRC that’s quite often an intermediate stage before selling the company to a PLC. It means a proportion of the proceeds from the sale go to the ESOT which can then distribute them to the workforce in a highly tax efficient manner. Pretty sure several of the ex-NBC companies had structures which were something like 50% owned by the managers and 50% by the ESOT.
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Big BSIP passenger growth in Lincolnshire:
https://www.route-one.net/news/lincolnshire-bsip-funded-uplifts-grow-bus-patronage-by-up-to-118/
Peter Brown
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Right . . . let’s do a B&CU verify on that:
The Stamford Town Service (Route 182) used to run three days a week with four trips per day . . . so that’s 12 trips per week and 80 passengers . . . so that’s around 7 pax/trip. Decent enough.
Now, it’s 11 trips per day over 6 days (hourly departures 0700-1700) , so 66 trips per week. With 200 passengers per week, the average is now 3 pax/trip. Yikes !! Suddenly that doesn’t look so good, does it?
Yes, BSIP monies are used to “prime the pump”, but that’s a big hill to climb!!
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Looks like the services is not quite true.
Mondays to Fridays from 27 May 2024
0700 0800 1400 1500 1600 are NSch
Leaving M-F
Stamford, Bus Station Bay 5 0900 1000 1100 1200 1300 1700
(unless it changed since May in which case it has barely bedded in)
The Sch Additional Services I assume are also interworked with the 182S (unless that needs another vehicle on the road the same time)
I would have thought a 1800 departure might carry a few people
Looking at the route it is an anti clockwise circular which means those on the A1 side of the town have quite a bit of a 20min tour to reach the centre, those to the east are almost in walking distance to the town, I wonder if most of the demand other than the school is the hospital ? Looks like Roger needs to visit
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Ahh, got it.
On Schooldays the 182S is interworked with the 182 hence the non running at the times indicated , when it is school holidays (and sats) the enhanced timetable runs ?
JBC Prestatyn
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What maybe needs to look at is the role of Bus/Train as both move back to Public Control (and possible ownership) In the days of the BTC , and even NBC and BR under the DfT there was still competition – for restricted Govt Funds, for which mid distance services were better provided by bus (or coach) services including the capital and running costs of say a new station. No matter what there was in the way of “timetabled” co-ordination at the end of the day it tended to be found what drove beyond day to day patronage (work patterns and car ownership / use excluded) was good meaningful publicity along with clean, well presented vehicles and staff. Easier to achieve if the publicity was route based (with added destination reasons to travel for leisure. Of course both had to be affordable.
But some city areas are investing in their local fixed rail services, is this coming at a cost of seeing buses as some kind of second class system – including not giving suitable priority to bus speeds ?
But maybe we should go back to thinking small – if technically possible – increased frequencies and vehicles that carry passengers rather than wheelarches could be a great help.
Interested to know how the costs of adding an hour to the operating day costs works out – I could never work out why Manchester’s “night bus” services were only 2 nights a week , to me there must be demand for that metropolis to be 24/7 on its key corridors and connection services quite easily at a profit at between 20min and half hour frequences.
Demand Responsive Systems – the idea of an actual . pan nation “uber-bus” actually feels like it has some kind of appeal , but how do cope with people that are not tech connected, you cannot switch a bus off a route to serve a doorstep if someone else is waiting at a bus stop that becomes unserved.
Cross Border Services. still and always difficult, even in London Transport days the falling off of fares as Country Services from say Epsom to the surrey villages were priced and not easily an integrated fare away from the Red Bus services that also got to such places.
Its probably obvious though that people dont go out as much evenings as the great moving of the 1950s and workplaces have changed , indeed at one time advertising was to travel off-peak and not in main times as the resources couldnt cope with the loads. (John Hibbs though pointed out that private companies would/could provide this additional peak supply – presumably at higher costs – but never noted if the extra capacity was in fact itself a waste of economic resources – it was this kind of arguement that in part privatised NBC and the PTEs but in general the industry was just caught up politically in the general state ownership and control is bad (of steel, carmaking , gas, electricity, water etc).
What might be a simple way to increase services at little cost – maybe by allowing the collaborative supply on routes with more different operators covering a route (Buxton-Manchester / Manchester Airport to me feels like being run from both ends would give a greater comprehensive service as an example, the loss in London generally of two garages running the cross london routes also reduced some flexiblity, as too in London being the taking out of revenue service the additional handy garage runs on some routes that bolstered other routes at various times.
JBC Prestatyn.
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That Lincolnshire link rather underscores the opportunity, and the problem.
The Stamford town service operated by Bland’s has recorded the headline 118% increase. It previously carried an average of 80 passengers per week until June but now averages 200. The timetable has expanded from four journeys per day on three days per week to hourly departures over six days
that looks like an increase in supply somewhat over double, yet passenger numbers havent kept up with that ( the cost of supply may be a little less than double depending on scheduling specifics ). at some point you cannot carry more passengers than those that desire to travel even if you give more people opportunities to only some will take those opportunities up.
Whatever happened to Workplace Travel Plans ?
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The bus fare cap in England will be raised to £3 in the upcoming Budget, Prime Minister Sir Keir Starmer has announced.
The existing cap was due to expire at the end of December.
Sir Keir said: “I do know how much this matters, particularly in rural communities where there is heavy reliance on buses.”
The new £3 cap, covering most bus journeys in England, will run until the end of 2025.
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Not that sensible in my view. A two band system night be better
Say £2 for up to 3 miles and then £3 for over 3 miles
£3 for short journeys will discourage the use of the bus for short journeys as £3 will be seen as to high
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It is the max a passenger pays, the govt tops up from there. Might stop some operators putting in £2 for a full length journey of £5 and claiming more from govt based on passenger mileage. Operators dont have to be in the scheme (The Delaine wasnt). If a bus operator is happy to charge £2 on a local journey they still can and keep all the revenue. I suspect some PTA / Mayor Areas may set different caps
JBC Prestatyn
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Oh good grief …..
All Together Now:
“it’s a fare CAP!”
The maximum fare charged by participating operators will rise from £2 to £3.
Any shorter fares will stay as they are …. so a £1.50 fare will not change. A fare between £2 and £3 will rise to £3. Any fares that ahould be over £3 will be £3.
On my local route, the fare into town should be nearly £5 by now, so I’m still winning.
This is the strategy that bus companies have been asking for ….if the cap rises to £4 in a year, and is then withdrawn altogether, that’ll do.
Remember, this was a strategy to help out the lower paid after Covid and Truss …. NOT to simply help bus companies, although that was a welcome side-effect.
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I think Greenline 727 might be oversimplifying this. Fares below £2 can rise by to to inflation from the last increase. What exactly will happen to fares between £2 and £3 remains to be seen, bus operators will wait with interest to see what the small print says and what the funding looks like for the over £3 cap. With wage inflation in the bus industry plus other costs if there are restrictions on the under £3 fare rises I think a lot of operators may just decide a £3 cap is not worth it
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