Abolishing peak and off peak fares?

[redreni]

Adding a limited number of advance fares to services like the ones I mentioned would only increase income though presumably?

If people who currently wait until peak restrictions have ended buy those tickets, it might generate a bit more income from them, if the Advances were priced higher than the super off-peak.

In the unlikely event people who currently refrain from travelling, drive or take the coach buy those tickets, that's a gain.

But it loses revenue from anyone who currently buys the Anytime ticket and switches to the cheaper Advance.

 

[yorksrob]

The railway is more concerned about extracting revenue than the efficient use of the infrastructure and rolling stock.

== Doublepost prevention - post automatically merged: 11 Feb 2025 ==

One fellow paying £195 for a single from Newcastle to London is better than two people each paying £95.

It's why the DfT are so keen to abolish walk-up off-peak fares, as we see on LNER.

An example of the wealthy distorting the market to the detriment of the working class perhaps.

 

[Lewisham2221]

Only sometimes, though. I don't see too many advances out of Leeds or Manchester at 5pm, though I may be looking in the wrong place.

I don't see too many almost empty trains leaving Manchester at 5pm either

 

[Bletchleyite]

One fellow paying £195 for a single from Newcastle to London is better than two people each paying £95.

It's why the DfT are so keen to abolish walk-up off-peak fares, as we see on LNER.

To be fair on that one it's also to allow people to be priced onto slower services. If all Newcastle-London services off peak are £80, you're going to pick the fast one. Whereas if you can price the fast ones up to the same price as Edinburgh-London (which they often do!) but the slow one stays at £80, more people will pick the slow one, keeping more lucrative Edinburgh seats on sale. You can of course just price the slow one down (as Avanti do), but then revenue is reduced.

I dislike it myself for reasons discussed to death on the appropriate thread, but that is one positive for the TOC that isn't purely about cranking all the prices up uniformly by about 50%, despite that being largely what it's done.

 

[Haywain]

The railway is more concerned about extracting revenue than the efficient use of the infrastructure and rolling stock.

The DfT, which is in control, wants to maximise revenue and have the most efficient (cheapest) use of infrastructure and rolling stock. The latter isn't improved by filling seats, or by providing more at busy time.

 

[Horizon22]

Adding a limited number of advance fares to services like the ones I mentioned would only increase income though presumably?

Well not necessarily because the person paying £50 would no longer exist and would instead be buying a cheaper advance. Of course there is a perfect yield point but that’s not going to be easy to calculate.

 

[Spamcan81]

You provide the answer to your own question.

To maximise revenue, it is better to have 1 person paying £50 than 3 people paying £15.95, which only adds up to £47.85.

So you price the advance at £20 and get 3 x £20 instead of 1 x £50.

 

[Haywain]

So you price the advance at £20 and get 3 x £20 instead of 1 x £50.

Can you be sure that you get 3 times as many people travelling though? If you don't, you've lost revenue.

 

[redreni]

So you price the advance at £20 and get 3 x £20 instead of 1 x £50.

You're also not getting the £8 each way off the two who aren't paying the Anytime fare, if they currently pay the super off-peak day return fare.

Only if they're extra people do you generate a little bit more revenue.

 

[Spamcan81]

Can you be sure that you get 3 times as many people travelling though? If you don't, you've lost revenue.

Give it a trial and see what happens. You won’t find out if you don’t try.

== Doublepost prevention - post automatically merged: 11 Feb 2025 ==

You're also not getting the £8 each way off the two who aren't paying the Anytime fare, if they currently pay the super off-peak day return fare.

Only if they're extra people do you generate a little bit more revenue.

So you give it a trial period and see what happens.

 

[Haywain]

Give it a trial and see what happens. You won’t find out if you don’t try.

How much money would you have to lose to prove it doesn't work? How much would you have to make to prove it does work? There was a trial in Scotland of doing away with "peak" fares, but it was abandoned because it didn't achieve growth in passenger numbers to cover the lost revenue.

There's actually an area of the forum for putting forward such ideas - it's called Speculative Discussion.

 

[Watershed]

Trains such as the 08:33 London to Manchester are likely to have higher business demand than later services. More to the point, a price-inelastic business traveller will be prepared to pay a higher price to travel on that train if it's the one they want to take, whilst a price-sensitive leisure traveller is more likely to be prepared to delay their travel until the 09:33 for example.

So this pricing model makes sense when viewed through the Treasury's myopic lens of purely caring about maximising fare revenue. But it makes no sense at all when you look at the wider impact on rail's modal share (with implications on road traffic, pollution etc.), or consider the way the WCML's capacity is being wasted (despite it having taken billions in upgrades to achieve).

 

[yorksrob]

The DfT, which is in control, wants to maximise revenue and have the most efficient (cheapest) use of infrastructure and rolling stock. The latter isn't improved by filling seats, or by providing more at busy time.

If the state provides expensive infrastructure and trains at taxpayers expense, it's not efficient to have it running around empty. You're missing out on the economic activity that the people not in the empty seats would otherwise be undertaking.

 

[Snow1964]

Yield management.

No it's selective partial yield

True yield management maximises yield and balances out usage on services that are running anyway. Leaving 3 in 4 seats empty as Op suggests is not yield management, it's fixed pricing that is not flexed.

Setting a £50 fare then filling only 1 in 4 seats is a worse option than adjusting the fare to £30 and filling 2 in 4 seats. It's a problem of setting clunky (arbitrary) time thresholds rather than have basing the thresholds on demand

 

[yorkie]

I travel regularly from Lewes to London. Super off peak, with a railcard a day return costs £15.95 and the trains are usually busy and often very busy mid to late morning.

Whenever I travel in the ‘rush’ hour, where a day return can cost £50 or more, the train, like my 06.18 today, is mostly empty. Most bays of four had just one person in them today.

Similarly on the ‘peak’ 08.33 from London to Manchester I’m sitting on. My one way ticket, using a split at Stafford, has cost £105. Yet the train is almost empty.

Why aren’t train companies or the DfT doing more to incentivise travel on services so lightly loaded?

The DfT and some people at TOCs are very keen to extract as much money as possible from people who take these early trains which are less busy, because those who use those trains often have no choice, so are there to be fleeced.

The rail network in this country isn't run on the basis of social benefits, modal shift, etc but on maximising the amount that users of the service have to pay.

Furthermore, the DfT are very keen for the cost of Off Peak travel to increase, rather than the cost of Anytime travel to reduce; you see this on the East Coast Main Line, where LNER's price trial has involved abolishing the lower priced fares, forcing people to pay more, with the only alternative being Advance fares.

TOCs like people to use Advance fares because then they can withdraw them on a whim, reduce the quota of them, and of course anyone who misses their train (which may depart 2 minutes early) has to pay again, which is a nice little earner.

Morally, your argument is quite right, but the way the network is run in reality is at complete odds with what you propose, sadly.

 

[Haywain]

If the state provides expensive infrastructure and trains at taxpayers expense, it's not efficient to have it running around empty.

The state is seeking to minimise the expense to the taxpayer.

 

[paul1609]

I travel regularly from Lewes to London. Super off peak, with a railcard a day return costs £15.95 and the trains are usually busy and often very busy mid to late morning.

Whenever I travel in the ‘rush’ hour, where a day return can cost £50 or more, the train, like my 06.18 today, is mostly empty. Most bays of four had just one person in them today.

Similarly on the ‘peak’ 08.33 from London to Manchester I’m sitting on. My one way ticket, using a split at Stafford, has cost £105. Yet the train is almost empty.

Why aren’t train companies or the DfT doing more to incentivise travel on services so lightly loaded?

The 06.18 departure from Lewes is a bit of an oddball service. Its the first departure from Hastings in the morning after the signalbox opens. It then calls at practically every station on the East Coastway until it reaches Lewes where it takes a non standard path to London. At Haywards Heath it is known on some days to be a lightly loaded service amongst much busier services.
I guess that the reason that its survived is that it provides the first train of the day to Gatwick for early flights from the East Coastway.

 

[yorksrob]

The state is seeking to minimise the expense to the taxpayer.

That doesn't automatically make it an efficient use of the resource.

 

[nwales58]

Simple(istic) view of any peak, travel to work, special events, holiday routes ...

For public policy: good, if achieves modal shift from congested roads

For public finances: bad, if needs subsidy to provide additional services or infrastructure for the peak alone

This is the classic problem of users versus neighbours versus taxpayers

However, I am not convinced that current rail pricing is intended to, nor achieves, any specific objective. Which should worry everyone.

 

[Tetchytyke]

Setting a £50 fare then filling only 1 in 4 seats is a worse option than adjusting the fare to £30 and filling 2 in 4 seats.

To an extent. But if one person paying £30 would have actually paid £50 and the other person would have still paid £30 by travelling later, overall the yield is lower. Which is how the railway looks at it.

 

[Haywain]

That doesn't automatically make it an efficient use of the resource.

I didn't say it is, and I didn't say that efficient use of the resource is the priority because it is clear that it isn't.

 

[yorkie]

The state is seeking to minimise the expense to the taxpayer.

Ostensibly, yes, however I'm not convinced that the approach of deterring passengers through high prices is actually achieving that.

The high cost of travel at certain times must be putting pressure on the demand at other times, which could increase costs. However it is very difficult to model this, and the effects on one floor can be very different to another.

 

[Bletchleyite]

The state is seeking to minimise the expense to the taxpayer.

Not only that, but every journey that doesn't take place by car costs them in lost fuel tax.

 

[Doctor Fegg]

The DfT, as ever, plucked defeat from the jaws of victory here with their botched implementation of part-time season tickets.

All over the South-East, an increasingly common pattern is WFH Monday and Friday, office Tue-Thurs. This is why you are starting to see MFO and MFX services appear in the Chiltern timetable, for example. These are the people who once consistently filled peak trains. But there is currently no ticketing product that offers consistently reasonable value on this. Consequently people make the best of whatever Advances might be on offer, and adjust their working hours to avoid punitive peak fares when they aren't.

The solution is in DfT's grasp if they want to…

 

[crablab]

Thanks to the mods for merging this with the previous thread

As I said above; the trains I have to stand on (or sit in the vestibule) aren't peak services in most cases - they're off peak at various times.

I'm not suggesting there aren't busy peak services and empty off-peak, but I do see a trend where (for reasons discussed above) people just aren't willing to pay for, and can avoid, the punitive Anytime tickets.

There are peak services I travel on which are mostly empty - I don't see how this is a good use of taxpayer resources.

 

[Meerkat]

Thanks to the mods for merging this with the previous thread

As I said above; the trains I have to stand on (or sit in the vestibule) aren't peak services in most cases - they're off peak at various times.

I'm not suggesting there aren't busy peak services and empty off-peak, but I do see a trend where (for reasons discussed above) people just aren't willing to pay for, and can avoid, the punitive Anytime tickets.

There are peak services I travel on which are mostly empty - I don't see how this is a good use of taxpayer resources.

So the taxpayer would benefit by raising off peak fares - they were created to fill empty off peak seats so aren’t needed if there aren’t empty seats

 

[Bletchleyite]

So the taxpayer would benefit by raising off peak fares - they were created to fill empty off peak seats so aren’t needed if there aren’t empty seats

This is presumably part of LNER's argument for having increased fares something like 50% over the past few years. Though in reality it's artificial scarcity, because it would be possible to run more trains, there's just been an almighty amount of faff getting there.

 

[Rail_Midlands]

Most of the railways around the world make losses and the governments subsidise them. But they focus more on the economic multiple railways bring to the country. UK is the only one who is very myopic that could not see it. The rail industry comes up with all the shenanigans like Revenue management, tax management from fuel etc into this core public infrastructure, built on taxpayers money and milk it to death.

 

[Haywain]

UK is the only one who is very myopic that could not see it.

If you are suggesting that every other railway in the world is run as a low priced public service your are a long way off the mark. There are a good number of places where long distance rail travel is only a luxury product, and make the GB rail system look good value.

 

[crablab]

they were created to fill empty off peak seats so aren’t needed if there aren’t empty seats

As I posted above, I would be in favour of removing this arbitrary distinction between peak/off-peak and the consequential rise in average fare.

The point I'm making is that the punitive anytime pricing doesn't necessarily reduce the demand, it mearly bunches it at a different time so other trains are overcrowded. It's proving a few poor load balancing mechanism.

As Bletchyrite says, LNER seem to view the market as very elastic and want to increase prices commensuratly on their leisure services.
But I don't think that's so true of the previously stable commuter market, which can choose to WFH, which days they do travel and flex the time at which they travel. Why pay 3x the price, if you can come in an hour later?

I imagine more people (like me) would choose to travel earlier if they weren't penalised for doing so; instead many commuters are cramming onto off-peak services.

As I say, my experience is some peak time trains are very lightly loaded - especially at the beginning and end of the week. I'm comparison, I'm regularly left on the platform or standing when catching the off-peak services.