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How to make the intercity fare system better.

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TravelDream

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You're describing a system optimised for loading while espousing a system optimised for revenue. The current models in use are invariably some compromise between these objectives. However, you must accept a trade-off. If you want "smoother" loadings, that's likely to result in a slight drop in revenue. It'd be easy to increase revenue (and cost utilisation!) tomorrow by tolerating higher loading.l on some trains. But obviously that comes at the expense of passenger experience.

That's the total opposite of what the airline and intercity bus industries have found.

BTW, I am not talking about everyone paying more, but an average higher fare whilst those quieter trains shouldn't have everyone paying less, but a lower fare on average. The aim of a revenue management system isn't 'smooth loading', but to maximize revenue.
 
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Bletchleyite

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That's the total opposite of what the airline and intercity bus industries have found.

BTW, I am not talking about everyone paying more, but an average higher fare whilst those quieter trains shouldn't have everyone paying less, but a lower fare on average. The aim of a revenue management system isn't 'smooth loading', but to maximize revenue.

And despite your thinking otherwise, Virgin Trains (and Avanti after them), post COVID, were of the view that 1 x £200 is better than 3 x £50.

The opportunities to upsell on the railway are much more limited than with air travel.
 

TravelDream

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And despite your thinking otherwise, Virgin Trains (and Avanti after them), post COVID, were of the view that 1 x £200 is better than 3 x £50.

The opportunities to upsell on the railway are much more limited than with air travel.

To quote myself:
''No doubt someone will post below about the fallacy of one £200 fare is better than two £80 ones.
That's just a basic misunderstanding how airline pricing and true revenue management works. It's far better to have one £180 fare, two £90 fares + £10 seat reservations, one £30 fare + £6.50 meal deal than just that one £200 fare. It's even better to have ten £20 fares than one £200. Why? Better chances of more revenue extraction and upselling.''
 

Bletchleyite

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To quote myself:
''No doubt someone will post below about the fallacy of one £200 fare is better than two £80 ones.
That's just a basic misunderstanding how airline pricing and true revenue management works. It's far better to have one £180 fare, two £90 fares + £10 seat reservations, one £30 fare + £6.50 meal deal than just that one £200 fare. It's even better to have ten £20 fares than one £200. Why? Better chances of more revenue extraction and upselling.''

And to quote myself:

The opportunities to upsell on the railway are much more limited than with air travel.
 

Starmill

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That's the total opposite of what the airline and intercity bus industries have found
It's not though is it. British Airways frequently charge enormous sums of money to travel on planes which then leave with the seat unfilled, rather than selling it off last minute for £20.

Low cost airlines might well be desperate enough to fly full that they'll do that, sure. But they don't have a monopoly on air travel and most long distance railway services aren't targeting the low cost segment.

To put it another way revenue has often been healthily maximised by restricting capacity and exploiting your near monopoly position.
 

TravelDream

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It's not though is it. British Airways frequently charge enormous sums of money to travel on planes which then leave with the seat unfilled, rather than selling it off last minute for £20.

Airline load factors have increased dramatically in recent decades.
50% wasn't usual in the 60s.
Today, traditional airlines like BA have load factors in the 80s and low cost ones like Ryanair the mid 90s.
BA - https://www.statista.com/statistics/1131673/passenger-load-facor-british-airways-plc/
Ryanair - https://www.statista.com/statistics/1126148/ryanair-passenger-load-factor/
Why?

Because airlines have realised that rather than the fixed fares with limited discounts as found in the 60s, dynamic pricing increases load factors, revenue and profitability.

Some people on this forum are clearly naysayers stuck in a timewarp. In other countries like with SNCF in France, they have a much larger shares of domestic passenger throughput because they have adapted and use a different model to us. Results speak for themselves.
 

Starmill

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Airline load factors have increased dramatically in recent decades.
50% wasn't usual in the 60s.
Today, traditional airlines like BA have load factors in the 80s and low cost ones like Ryanair the mid 90s.
BA - https://www.statista.com/statistics/1131673/passenger-load-facor-british-airways-plc/
Ryanair - https://www.statista.com/statistics/1126148/ryanair-passenger-load-factor/
Why?

Because airlines have realised that rather than the fixed fares with limited discounts as found in the 60s, dynamic pricing increases load factors, revenue and profitability.

Some people on this forum are clearly naysayers stuck in a timewarp. In other countries like with SNCF in France, they have a much larger shares of domestic passenger throughput because they have adapted and use a different model to us. Results speak for themselves.
And yet, Avanti still charge £160 - £185 for a very lightly loaded trains around 4pm on Tuesdays from London to Manchester. Why? Because it is profitable... There's really no alternative, except an even more expensive flight at likely a less convenient time and without a journey time advantage. And if you can't afford that you'll probably still pay Avanti for their services, but later in the day when they're at capacity. Offering any cheaper tickets at 4pm would see people trading down to them.

Ryanair are in actual competition with the other airlines.

I think you're just mistaken about the development of modern railway yield management to be honest. It's rubbish in some places but the big money routes London to Manchester and London to Edinburgh have lots of attention paid to them.

SNCF have the necessary capacity to offer dedicated long distance services. Something which essentially doesn't exist here.
 

stuu

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Some people on this forum are clearly naysayers stuck in a timewarp. In other countries like with SNCF in France, they have a much larger shares of domestic passenger throughput because they have adapted and use a different model to us. Results speak for themselves.
SNCF has a 10% share compared to 8% in the UK. I would suggest that geography, in the sense that France has longer distances between its major cities, is a major factor. Also 40 years of new LGV construction makes journeys much more competitive with air and other modes. Both of those factors are far more important in terms of market share than any yield management or the use of the low cost brand
 

deltic

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True for the first point.
The second point isn't. I just checked for tomorrow and I can fly for well over £50 less than take the train for morning peak up and evening peak back down.
The luggage thing is a bit of a fallacy too. Most people on a domestic trip carry hand luggage sized bags. Many people are simply unable to haul their own heavy suitcases on and off trains and prefer airline staff to do that for them.

Don't forget airports in this country are run for a profit and that some major train stations are not too dissimilar.

I dont know what times you looked at for your flights but I found when I looked there was no difference. Lets look for Monday - you can travel by train for £139.70 travelling up on the 06.15 from Kings Cross and returning on the 16.52 from Edinburgh. Travelling by air the lowest headline fare is Easyjet travelling on the 08.10 from Stansted and returning on the 18.35 from Edinburgh - for £76.98. However, if you want to take anything with you other than a small bag that fits under your seat you have to pay £20.74 each way and the cheapest standard seat available will cost you an extra £4.99 each way if you want to choose where to sit. So we are now at £128.44 for the Easyjet flight. I cant remember if they charge extra for credit cards or not. And then for most people there is the cost of getting to Stansted.

On Ryanair there are similar there add-on charges are

Extra legroom seats from £14 to £28
Front Seats from £7 to £17
Standard Seats from £3 to £13
Mandatory Family Seat £4 to £6
At least one adult travelling with children under 12 (excl. infants) must buy a reserved seat and sit next to them. Up to 4 children (under 12) travelling with one adult will get free reserved seats (seats in rows 18-33).
Infant fee £25 (must be under 2 years for both outbound and return flight)
Card Payment Fee Cost-related % of the total transaction value which depends on the form of payment and where the payment service providers are located

Small Bag Free
Priority & 2 Cabin Bags £8 to £30
10kg Check-in Bag £12.99 to £23.99
20kg Check-in Bag £20.99 to £39.99

So I agree that the low cost airlines are good at drawing people in with what looks like cheap fares and then fleece them with lots of extra charges. Fascinating Aida have a great song about it which also highlights the reputational damage caused by such a strategy. Cheap Flights for 50p which can be seen at

Rail stations don't benefit from the hidden subsidy of sales of duty-free
 

TravelDream

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SNCF has a 10% share compared to 8% in the UK. I would suggest that geography, in the sense that France has longer distances between its major cities, is a major factor.
The longer distances in France should make rail *less* competitive, not more. The fact rail has a higher share despite the greater distances shows how SNCF doing things differently brings greater success. This isn't totally down to their adoption of HSR.

I dont know what times you looked at for your flights but I found when I looked there was no difference. Lets look for Monday - you can travel by train for £139.70 travelling up on the 06.15 from Kings Cross and returning on the 16.52 from Edinburgh. Travelling by air the lowest headline fare is Easyjet travelling on the 08.10 from Stansted and returning on the 18.35 from Edinburgh - for £76.98. However, if you want to take anything with you other than a small bag that fits under your seat you have to pay £20.74 each way and the cheapest standard seat available will cost you an extra £4.99 each way if you want to choose where to sit. So we are now at £128.44 for the Easyjet flight. I cant remember if they charge extra for credit cards or not. And then for most people there is the cost of getting to Stansted.

So what you are saying is I am right.
Yes, if you add all the extras, the flight can become comparable in price. However, for your businessman traveling for the day or daytripper, luggage is totally irrelevant. I don't personally pay for seat selection and easyjet almost always places those traveling together for free in the end (and if they don't it's not such a big deal. Headphones in, eyes closed ;)). I've gone on week long holidays with just hand luggage. It's totally do-able.

Secondly, I don't live upstairs from King's Cross so I still have to get there for 6am to catch this train which is not without huge difficulty unless you're near a tube station. Stansted for 7.30ish is do-able from basically anywhere in the London region in comparison. Both have a cost.
*I chose those times as with just hand luggage, I usually aim to be at a major train station 10-15 mins before departure and airport 40-45 before. I've caught well over a hundred flights and hundreds of trains and never missed one.

So, for me, it'd be £77 for the flight and possible £140 for the train, but more likely I'd take the 7am train so it'd be £217 - that's £63 to £140 more.
If Stansted for £77 isn't ideal, similar times are available from Luton for £107 and Gatwick £135 - all three cheaper than even taking that 6.15am train.
 

Bletchleyite

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The longer distances in France should make rail *less* competitive, not more. The fact rail has a higher share despite the greater distances shows how SNCF doing things differently brings greater success. This isn't totally down to their adoption of HSR.

I would figure it is a combination of:
1. Much cheaper than here
2. Faster than here (but HS2 is coming)
3. Toll motorways meaning a visible cost to car use

Not because of nickel-and-diming, which only Ouigo trains do (similar to Lumo in concept).
 

Nick Ashwell

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The longer distances in France should make rail *less* competitive, not more. The fact rail has a higher share despite the greater distances shows how SNCF doing things differently brings greater success. This isn't totally down to their adoption of HSR.
Other than LGV services Colas services are okay but French rail is worse than much of the UK in all honesty, coming from someone who used to use SNCF daily.
Everything seems to point towards the efforts the French government made years ago in regards to new LGVs but they have also continued to build.

Alongside this I was able to use my reloadable Season Ticket smart card thing as a railcard as well which meant that my commute from Marseille to La-Seyne was also useful to lower my costs to move around France over longer distances.

That said with the current split of UK rail it doesn't seem that using a Season Ticket to get a discount would work but I can't see a problem if everything is going GBR?
 

Dr Day

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One key difference between airlines/SNCF and UK InterCity operators is that the former are not obliged to carry 'walk up' passengers (both end to end and joining/alighting at intermediate stations) with no reservation at a regulated fare. Compulsory reservations has been discussed at length on numerous threads already.
 

stuu

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The longer distances in France should make rail *less* competitive, not more. The fact rail has a higher share despite the greater distances shows how SNCF doing things differently brings greater success. This isn't totally down to their adoption of HSR.
Why? A longer distance means trains can use their speed advantage over road travel, therefore making it a more attractive option. Also French motorways are generally tolled, which adds expense to the marginal cost of a road journey
 

deltic

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The longer distances in France should make rail *less* competitive, not more. The fact rail has a higher share despite the greater distances shows how SNCF doing things differently brings greater success. This isn't totally down to their adoption of HSR.



So what you are saying is I am right.
Yes, if you add all the extras, the flight can become comparable in price. However, for your businessman traveling for the day or daytripper, luggage is totally irrelevant. I don't personally pay for seat selection and easyjet almost always places those traveling together for free in the end (and if they don't it's not such a big deal. Headphones in, eyes closed ;)). I've gone on week long holidays with just hand luggage. It's totally do-able.

Secondly, I don't live upstairs from King's Cross so I still have to get there for 6am to catch this train which is not without huge difficulty unless you're near a tube station. Stansted for 7.30ish is do-able from basically anywhere in the London region in comparison. Both have a cost.
*I chose those times as with just hand luggage, I usually aim to be at a major train station 10-15 mins before departure and airport 40-45 before. I've caught well over a hundred flights and hundreds of trains and never missed one.

So, for me, it'd be £77 for the flight and possible £140 for the train, but more likely I'd take the 7am train so it'd be £217 - that's £63 to £140 more.
If Stansted for £77 isn't ideal, similar times are available from Luton for £107 and Gatwick £135 - all three cheaper than even taking that 6.15am train.
You are falling into the trap of thinking about how you travel rather than how the majority of people actually travel - the difference in cost between rail and air is not that great for the average passenger making occassional trips.

We agree that low cost airlines are better at posting low fares and gouging extra revenues for which they get a lot of bad press for. The railways will be hammered even more for this given the greater difficulty in intercepting passengers before they join the service compared to air.
 

TravelDream

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You are falling into the trap of thinking about how you travel rather than how the majority of people actually travel - the difference in cost between rail and air is not that great for the average passenger making occassional trips.

Business people going for day trips do not take large pieces of luggage. Daytrippers do not take large pieces of lugagge. That isn't me, it's everyone with a one or two really limited exceptions. .
And I realise lots of people going on a holiday longer than a couple will want to check a bag, but millions and millions of people every year do so without checking one. It's not just me.

Even then, I have been there with a large suitcase on a train struggling to carry it up a flight of stairs more than a couple of times, worried it's going to get stolen (yes, it can get stolen when flying, but a) I've flown many times in less nice parts of the world and it's never happened to me and b) the airline will compensate you if it does) and finding it generally difficult and uncomfortable. It's much better to let someone else deal with it.
For jounreys in the UK, I have actually shipped a suitcase with a shipper for not that much money at all. It was definitely worth it.
 

quantinghome

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The longer distances in France should make rail *less* competitive, not more. The fact rail has a higher share despite the greater distances shows how SNCF doing things differently brings greater success. This isn't totally down to their adoption of HSR.
On the contrary. The distances between the main cities of France means SNCF's intercity market is focused on 300-600 mile journeys. By contrast, most intercity journeys in the UK are 100-200 miles (London-Scotland is a relatively small % of intercity journeys). This means SNCF has been in direct competition with airlines on most of its intercity routes and has had to build the infrastructure to compete on journey time, whilst also giving it the capacity to sell fares more cheaply. Let's face it, if France hadn't built the TGV network they wouldn't be competitive with airlines no matter how clever their fare structure was - they simply wouldn't have had the journeys time or capacity to compete.

By contrast the UK intercity market is focussed on competition with the car and coach and has built its market accordingly by offering a faster service at a premium, then adopting demand management over the last 20-30 years to maximise off-peak revenue. Rail market share from the South of England to Scotland has improved in recent years but that has come as a side-benefit to upgrades focussed on <200mile journeys; it wasn't the main target. The UK's geography simply means intercity rail has had bigger fish to fry than chasing after the 300+ mile airline market.

I firmly believe we should now be looking to transfer the bulk of air travel to rail. But changing the fare system won't achieve much without big infrastructure investment.
 

yorkie

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That would be a far worse model than now and is exactly what shouldn't be done. People traveling on busier trains should pay more to maximize revenue extraction. People traveling on quieter trains should pay less to encourage more to travel on said trains and, thus, maximize revenue extraction. That's basic yield management.
What's your proposed solution?



True for the first point.
The second point isn't. I just checked for tomorrow and I can fly for well over £50 less than take the train for morning peak up and evening peak back down.
We should need more information to so a comparison but it's certainly true that rail fares can often be undercut by airlines and some changes should be implemented to reverse this; however I see it as a separate matter to fares reform (though any such reform could take this requirement into account, of course).

Any such comparison would be bet made in the thread dedicated for that purpose.

The luggage thing is a bit of a fallacy too. Most people on a domestic trip carry hand luggage sized bags. Many people are simply unable to haul their own heavy suitcases on and off trains and prefer airline staff to do that for them.
Different people will have different preferences but this is one for the airline vs rail comparison thread.

Don't forget airports in this country are run for a profit and that some major train stations are not too dissimilar.
There isn't any similarity between how airports and stations are run but I think it's not relevant to the topic of fares reform.

Booking seats (with premium seats like those with more legroom and next to a table costing more), quiet carriages, pre-booking food and drinks, wifi usage etc. etc. There are many things that sufficient people are willing to pay extra for that would make business sense..
None of these are dependent on fares reform and are arguably separate matters.

Moving to a system whereby train operators are reliant on income from optional extras would not be simple to implement, however.

== Doublepost prevention - post automatically merged: ==

....more likely I'd take the 7am train so it'd be £217...
What journey is costing £217?

There is no need to overhaul the fares system and abolish Off Peak fares to make it cheaper; TOCs could offer cheap Advances for the train you are travelling on, if they wanted to, under the current system.

== Doublepost prevention - post automatically merged: ==

On the contrary. The distances between the main cities of France means SNCF's intercity market is focused on 300-600 mile journeys. By contrast, most intercity journeys in the UK are 100-200 miles (London-Scotland is a relatively small % of intercity journeys). This means SNCF has been in direct competition with airlines on most of its intercity routes and has had to build the infrastructure to compete on journey time, whilst also giving it the capacity to sell fares more cheaply. Let's face it, if France hadn't built the TGV network they wouldn't be competitive with airlines no matter how clever their fare structure was - they simply wouldn't have had the journeys time or capacity to compete.

By contrast the UK intercity market is focussed on competition with the car and coach and has built its market accordingly by offering a faster service at a premium, then adopting demand management over the last 20-30 years to maximise off-peak revenue. Rail market share from the South of England to Scotland has improved in recent years but that has come as a side-benefit to upgrades focussed on <200mile journeys; it wasn't the main target. The UK's geography simply means intercity rail has had bigger fish to fry than chasing after the 300+ mile airline market.

I firmly believe we should now be looking to transfer the bulk of air travel to rail. But changing the fare system won't achieve much without big infrastructure investment.
I don't always agree with your posts, but this one is absolutely spot on.

== Doublepost prevention - post automatically merged: ==

One key difference between airlines/SNCF and UK InterCity operators is that the former are not obliged to carry 'walk up' passengers (both end to end and joining/alighting at intermediate stations) with no reservation at a regulated fare. Compulsory reservations has been discussed at length on numerous threads already.
Indeed.

Maybe I've misinterpreted but it sounds like the proposal in this thread is to abolish Off Peak fares, force people to use Advance fares, disallow spontaneous walk-up travel, abolish unreserved seating and make people pay for seat selection and various other add-on extras in the hope that the additional revenue generated by add-ons can reduce the cost of the Advance fares.

== Doublepost prevention - post automatically merged: ==

...So I agree that the low cost airlines are good at drawing people in with what looks like cheap fares and then fleece them with lots of extra charges. ..
I frequently go abroad with other forum members; my preference is to use Eurostar but where the cost of that is prohibitive I will take a plane. I have never had to pay anything other thn the flight cost and - optionally - the cost of seat selection.

On my last flights I paid about 20 quid each way for extra legroom seats. The journey time was 2.5 hrs and I treated this as similar to a 1st class upgrade on a train journey of a similar length. The difference in legroom is absolutely huge and therefore for me the cost was worth paying.

The OP proposes charging for seat selection on trains, but this would only be attractive to me on long journeys; most of my train journeys are significantly shorter than 2.5 hrs.

It's relatively easy for an airline to make this charge, but for train operators it would require all retailers to link into the same system, all offering seating plans in a consistent format. This would place additional burden on retailers. Most retailers do not offer seat selection and would only do so if they were given a share of the additional revenue generated.

The only retailers I know of to offer seat selection from a seating plan are LNER, XC and Avanti - for their own trains only - and Trainsplit/Raileasy for all relevant operators.

I do not think this would be an easy charge to make, nor would it be likely to rake in a lot of cash either.
 
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TravelDream

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We should need more information to so a comparison but it's certainly true that rail fares can often be undercut by airlines and some changes should be implemented to reverse this; however I see it as a separate matter to fares reform (though any such reform could take this requirement into account, of course).
If you read the thread of posts it's clear which journeys are being referred to. Post 40 and the one it quotes gives the details. https://www.railforums.co.uk/thread...ercity-fare-system-better.224368/post-5386629
The fares we are both referring to are 2* advance singles from London to Edinburgh and back vs easyjet for Monday morning up and evening back.
This is basically true all of the time though.
There isn't any similarity between how airports and stations are run but I think it's not relevant to the topic of fares reform.
Obviously not, but I was referring to commercial premises in each (bars, shops, restaurants etc.) and how money is made from them.
None of these are dependent on fares reform and are arguably separate matters.

Moving to a system whereby train operators are reliant on income from optional extras would not be simple to implement, however.
I think you don't get how airline fares work. 'Optional extras' are an integral part of their fare and revenue management system. The two cannot be separated.
 

yorkie

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If you read the thread of posts it's clear which journeys are being referred to. Post 40 and the one it quotes gives the details. https://www.railforums.co.uk/thread...ercity-fare-system-better.224368/post-5386629
The fares we are both referring to are 2* advance singles from London to Edinburgh and back vs easyjet for Monday morning up and evening back.
This is basically true all of the time though.
It would be easier if it was presented in a tabulated or bullet pointed format, but it sounds like the comparison is between the 0700 London to Edinburgh and 1652 back? You mention not being based at King's Cross but have not stated a starting location so we'll go with that for now. I can see a cost of £180 for the round trip, using my usual retailer.

This is a high cost to travel at that time but fares reform and abolishing off peak fares and charging for seats are neither going to change that, nor would they be necessary to change that.

The cost can be made affordable by the rail industry decreasing the cost of Advance fares; no change in fares structure is required or relevant. But they won't do that because of other factors, such as restrictions on capacity, the demand for travel (even if no-one did London to Edinburgh the trains would still be very busy with people making shorter journeys) and costs to cover.

If you are arguing for Advance fares to be reduced, and for plane fares (I see roughly equivalent plane fares are £83 for the round trip, plus the cost of travel to/from the airports) then I will agree with you, but I don't agree with abolishing Off Peak products.

Obviously not, but I was referring to commercial premises in each (bars, shops, restaurants etc.) and how money is made from them.
Still not comparable.
I think you don't get how airline fares work.
I do.
'Optional extras' are an integral part of their fare and revenue management system. The two cannot be separated.
Indeed; so it doesn't transfer well to the rail industry, where most people make much shorter journeys, you can buy through numerous sales channels and retailers, where reservations are not compulsory and you can - for many journeys - buy an affordable fare that lets you hop on and off as you desire.
 

Llanigraham

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Business people going for day trips do not take large pieces of luggage. Daytrippers do not take large pieces of lugagge. That isn't me, it's everyone with a one or two really limited exceptions. .
And I realise lots of people going on a holiday longer than a couple will want to check a bag, but millions and millions of people every year do so without checking one. It's not just me.

Even then, I have been there with a large suitcase on a train struggling to carry it up a flight of stairs more than a couple of times, worried it's going to get stolen (yes, it can get stolen when flying, but a) I've flown many times in less nice parts of the world and it's never happened to me and b) the airline will compensate you if it does) and finding it generally difficult and uncomfortable. It's much better to let someone else deal with it.
For jounreys in the UK, I have actually shipped a suitcase with a shipper for not that much money at all. It was definitely worth it.

Sorry, but some business people do carry large pieces of luggage, just as day trippers might. How about pushchairs, for example, or tool bags?

And the title of your thread says "intercity" and yet all you seem to have concentrated on is London to Scotland; have you fogotten that there are many other cities in the UK and that people do travel between them?
 

6Gman

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The idea for this thread came from the Railways vs flying from London - Scotland thread (https://www.railforums.co.uk/thread...st-to-scotland-axis-of-services.223987/page-7)

I think it's clear that the current fare system just simply doesn't work.
The traditional peak/ off-peak fares put off many ordinary consumers with their high fares and complexity. Advance fares are a blunt instrument that fail to stimulate demand in the right areas at the right times. Peak time trains often leave with a fair amount of space whilst the first off-peak train is usually jam-packed. People on the cheapest advance fares get the pick of their seat whilst someone on the most expensive walk-up fare may need to stand all the way from London to Edinburgh.
Most critically, trains are just incredibly poor value compared to air fares. easyjet and BA both run multiple flights from five different London airports to both Edinburgh and Glasgow and are very often cheaper than the train (The argument of the 'convenience' of the train on these long jounreys is best kept for the thread above. Lots of arguments have been put forward, though it's clear that airports have the advantage in this area). This is simply beyond belief when you remember that airlines are heavily taxed and trains are heavily subsidized.
I am not talking short/ commuter journeys of-course, but routes where the train competes with airlines and motorway speed intercity coaches for sub 4 hours routes.

My idea is that the train companies should just emulate the airlines. Airlines are masters of revenue extraction. They know how much to charge to get the maximum revenue and the introduction of low-cost airlines and the changes mainline ones have made have revolutionized the industry. They know the importance of non-fare revenue. They know the importance of marketing and how 1p fares, which basically nobody gets, gets a ton of marketing and people talking. The railway on the other hand seems stuck in the 1960s.

Why not have fares from London to Edinburgh from 1p? Of course, not everyone would pay a penny, that vast majority would pay a lot more; but the idea of the penny fares excites the consumer and makes them think they are getting a good deal on the 'low-cost' railways.
Trains should be priced to fill them, just like Ryanair, easyjet, British Airways and basically every airline does.
Do forget about the additional revenue sources! Cheap seats don't come with a seat reservation, that costs extra. Want a window seat or a table seat? That costs more money for everyone. The quiet carriage? That also costs more. Wifi? That costs more. Food/ drinks from the trolley can be pre-sold etc.
I'm not totally radical though. The current peak fare should stay as a cap and season tickets should still be available.

This has no need to be cost neutral. Stimulating extra demand, taking people off other modes of transit and cars and improved revenue management should increase revenue (just as it has for airlines) and, thus, increase profitability/ reduce the need to subsidy.

No doubt someone will post below about the fallacy of one £200 fare is better than two £80 ones.
That's just a basic misunderstanding how airline pricing and true revenue management works. It's far better to have one £180 fare, two £90 fares + £10 seat reservations, one £30 fare + £6.50 meal deal than just that one £200 fare. It's even better to have ten £20 fares than one £200. Why? Better chances of more revenue extraction and upselling.
I'm trying to work out how this would affect the way my wife and I use the railway.

We get up, go to the station (not straight away, we do wash, get dressed and eat), buy (e.g.) our West Midlands Day Rangers and catch the Inter City service to Birmingham. We sit in our chosen vacant seat and hey ho off we go.

What's all this nonsense about 1p fares, and paying extra for particular seats? (And on an 11-car Pendolino who polices it? ("Sorry madam, it'll be £10 extra for that seat - it's by a window." "Oh, I'll move over there then." "That'll be £15 extra, it's got a table." "But there's no other vacant seat!" "Then you'll have to stand.") That's going to be great PR!)

This seems yet another scheme based on A to E airline practice which fails to recognise that generally railways are an A - B - C - D - E business.
 

yorkie

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I'm trying to work out how this would affect the way my wife and I use the railway.

We get up, go to the station (not straight away, we do wash, get dressed and eat), buy (e.g.) our West Midlands Day Rangers and catch the Inter City service to Birmingham. We sit in our chosen vacant seat and hey ho off we go.
Indeed; people complain about the amount of choice we have regarding ticketing but the reality is that a lot of the complexity could be resolved within the existing framework by applying some fairly straightforward principles.

Abolishing fares which allow the use of any off peak train would be a very retrograde step for many people.

What's all this nonsense about 1p fares, and paying extra for particular seats? (And on an 11-car Pendolino who polices it? ("Sorry madam, it'll be £10 extra for that seat - it's by a window." "Oh, I'll move over there then." "That'll be £15 extra, it's got a table." "But there's no other vacant seat!" "Then you'll have to stand.") That's going to be great PR!)
#
I assume the proposal would be for seats to be chosen by people who pay extra at the time of booking and anyone who did not pay that extra amount would have their seat randomly issued to them a few hours before departure, as with the low cost airlines.


This seems yet another scheme based on A to E airline practice which fails to recognise that generally railways are an A - B - C - D - E business.
Agreed
 

6Gman

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I assume the proposal would be for seats to be chosen by people who pay extra at the time of booking and anyone who did not pay that extra amount would have their seat randomly issued to them a few hours before departure, as with the low cost airlines.
Which, of course, isn't much use to people like us who don't necessarily know where we want to go until we get to the station! :D
 

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One thing missing from this debate is that airlines operate the flights they do between pairs of cities because they feel it's commercially viable - TOCs operate services between cities because they were mandated to as part of the franchise (including certain minimum frequencies, earliest departures,, evenings and Sundays, with fare rises generally restricted to Government agreed levels that are based around RPI - often with the rolling stock being whatever was inherited)

Ryanair wouldn't operate between Edinburgh and London if there was no profit (they've scrapped services in the past, they've abandoned entire airports) - the fact that they operate flights means they are making money - O'Leary is a capitalist - they're able to choose the size of planes, airports they use and frequency of flights subject to getting slots at airports of course

TOCs are stuck having to operate a certain number of services rather than just the handful of peak departures that might be most profitable

Plus there's the age old contradiction that "passengers want simpler fares that are easier to understand than the current complex range of tickets" and also "we should have tickets that are more flexible with more options"... nobody seems to be able to square this circle

To quote myself:
''No doubt someone will post below about the fallacy of one £200 fare is better than two £80 ones.
That's just a basic misunderstanding how airline pricing and true revenue management works. It's far better to have one £180 fare, two £90 fares + £10 seat reservations, one £30 fare + £6.50 meal deal than just that one £200 fare. It's even better to have ten £20 fares than one £200. Why? Better chances of more revenue extraction and upselling.''

In which case I'll quote myself back:

If there's sufficient capacity then, sure, it'd be better to have (£180 + £90 + £90 + £10 + £30 + £6.50 =) over four hundred quid's worth of revenue than "just" £200

But there isn't always capacity for that many passengers - plus you'd have to "upsell" a lot of cups of coffee to make up the difference in ticket revenue - as well as the fact that cutting the fare from £200 to £20 doesn't guarantee that ten people will buy tickets (it might just mean that the person who previously bought the £200 ticket now buys a £20 ticket)

I don't think we got a proper answer to it, so I'll rephrase it:

1. If you slash the fare from £200 to £20, are there enough spare seats for ten times more passengers needed to just maintain the same revenue?
2. Are you confident that ticket demand is elastic enough to get ten people to buy £20 tickets instead of each person currently buying a £200 ticket? Even if fares were only a penny, I'd not be buying a return journey for several hundred miles every day/week
3. Noting that margins are so thin that catering on trains seems to be pretty unprofitable on most lines (since all major stations have a selection of coffee shops/ M&S Simply Foods etc), how many additional cups of coffee do you need to make up £180 of ticket revenue? Given that you need to factor in the cost of buying the ingredients before you can sell anything, is that £500 of food/drink sales required to make £180 of profit equivalent to the reduced ticket prices? £1,000 of food/drink sales? Easy to say "upsell" but you'd have to flog a lot of sandwiches to make up for every £180 that you'd lost in ticket revenue
4. I don't think that calling something a "fallacy" makes it a fallacy - you need to explain why bringing in significantly less ticket revenue is such a great idea - unless you are assuming that each passenger will be buying at least £100 of sandwiches on each journey?
 

TravelDream

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Sorry, but some business people do carry large pieces of luggage, just as day trippers might. How about pushchairs, for example, or tool bags?
Pushchairs are carried by airlines free of charge. The vast majority of tool bags are smaller than a piece of hand luggage.
What's all this nonsense about 1p fares, and paying extra for particular seats? (And on an 11-car Pendolino who polices it? ("Sorry madam, it'll be £10 extra for that seat - it's by a window." "Oh, I'll move over there then." "That'll be £15 extra, it's got a table." "But there's no other vacant seat!" "Then you'll have to stand.") That's going to be great PR!)
Obviously not. People could either pre-purchase a seat or sit in any unreserved seat.
Plus there's the age old contradiction that "passengers want simpler fares that are easier to understand than the current complex range of tickets" and also "we should have tickets that are more flexible with more options"... nobody seems to be able to square this circle
People on this forum want more flexible fares. The vast majority of the public, when traveling long-distance, pick a train they want to travel on and buy a ticket for it.
1. If you slash the fare from £200 to £20, are there enough spare seats for ten times more passengers needed to just maintain the same revenue?
Obviously that is an issue of revenue management. My feeling is demand is exceptionally elastic and the current system lowers demand considerably. Low cost carriers in Europe have stimulated billions of additional journeys (I am not over exaggerating) over the last couple of decades. Journeys that never would have taken place under the old system of traditional carriers with traditional fare structures.
 

stuu

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Obviously that is an issue of revenue management. My feeling is demand is exceptionally elastic and the current system lowers demand considerably. Low cost carriers in Europe have stimulated billions of additional journeys (I am not over exaggerating) over the last couple of decades. Journeys that never would have taken place under the old system of traditional carriers with traditional fare structures.
I don't know how true that is. Most of those flights are leisure flights for city breaks and weekends in the sun or whatever, which doesn't apply to most intercity routes in the UK. People aren't suddenly going to decide to go to Leeds on a whim to the same extent they might go to Prague.

Train travel in the UK is almost all in competition with the car, not air travel. Make it too complicated and a pain and people will just drive.
 

Llanigraham

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Pushchairs are carried by airlines free of charge. The vast majority of tool bags are smaller than a piece of hand luggage.,
Your comment was that day trippers didn't take luggage, not that it wasn't charged for, and I know of several specialist workmen who do fly and who do carry baggage much bigger than hand luggage. You do seem to be changing your arguement each time someone points out an error in it, and as far as I can see, all your proposals would make train use MORE complicated for the general traveller, not simpler, which is where we should be heading.

Again you seem to be concentrating on nothing but the London - Scotland journeys; what about the rest of the country?
 

6Gman

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Obviously not. People could either pre-purchase a seat or sit in any unreserved seat.
You haven't answered the question about how the extra payments for window seats/ table seats would be enforced.

== Doublepost prevention - post automatically merged: ==

I don't know how true that is. Most of those flights are leisure flights for city breaks and weekends in the sun or whatever, which doesn't apply to most intercity routes in the UK. People aren't suddenly going to decide to go to Leeds on a whim to the same extent they might go to Prague.

Train travel in the UK is almost all in competition with the car, not air travel. Make it too complicated and a pain and people will just drive.
A lot of the low-cost market between the UK and continental Europe was based on migrant workers. Post-Brexit it will be interesting to see if that market holds up.

The low-cost airlines have also exploited/created the market for international stag & hen weekends. Which the railway here has also done.

When my contemporaries were getting married a stag night was a local pub/club crawl - these days it's London/ Liverpool/ Newcastle using cheap advance tickets or Prague/ Riga etc.

== Doublepost prevention - post automatically merged: ==

My feeling is demand is exceptionally elastic and the current system lowers demand considerably.
Not sure the whole structure should be reformed over a "feeling" and if you're going to increase "demand considerably" where are you going to put all these extra passengers on often already (pre Covid) busy trains?
 
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TravelDream

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Your comment was that day trippers didn't take luggage, not that it wasn't charged for, and I know of several specialist workmen who do fly and who do carry baggage much bigger than hand luggage. You do seem to be changing your arguement each time someone points out an error in it, and as far as I can see, all your proposals would make train use MORE complicated for the general traveller, not simpler, which is where we should be heading.
Eh?
I didn't say day trippers didn't take luggage, read again what I wrote.
My argument hasn't changed at all either. It's a simple fact that daytrippers and most traveling businessmen don't take anything larger than hand luggage.
What is more complicated about it too?
You haven't answered the question about how the extra payments for window seats/ table seats would be enforced.
How are reservations enforced today?
Anyway, I never said that I have all the answers to life's problems. This is just an idea how to increase ridership, revenue and profitability.
 
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