First Group: General Discussion

[Cesarcollie]

But why would Rotala (or anyone else) want to buy Bolton post-franchising? They'd be buying an ageing fleet of buses, a load of staff with TUPE baggage and pension liabilities, probably outdated working practices etc etc.

 

[winston270twm]

But why would Rotala (or anyone else) want to buy Bolton post-franchising? They'd be buying an ageing fleet of buses, a load of staff with TUPE baggage and pension liabilities, probably outdated working practices etc etc.

Rotala are actively looking to grow in Manchester following their recent acquisition of Go Goodwins (Little Gem), in addition don't forget 'Opportunity A' from their July Fund Raising, which could see their Manchester fleet expand to 200 buses is still to be concluded. Opportunity B which was NX Hotel Hoppa has only been concluded in the past month.

Any takeover purchase price would reflect the age of fleet, , future business prospects, any pension liabilities & any other risks related to franchising.

 

[Harbouring]

Those machines are great. They were the first machines to allow for contactless payment using touch in and touch out. First were ahead of the game and have been accepting contactless for 5 years now:

http://www.firstgroupplc.com/news-and-media/latest-news/2011/03-09-2011-ukbus.aspx

I think the case was that it didn’t actually happen for 5 years after that press release. In fact I think that press release is referring to Almex which have only been started to be replaced in the past 12 months with contactless ticketer units.

Did any first company have contactless before 2016 does anyone know?

 

[radamfi]

I think the case was that it didn’t actually happen for 5 years after that press release. In fact I think that press release is referring to Almex which have only been started to be replaced in the past 12 months with contactless ticketer units.

Most implementations of contactless mean that you still have to get a paper ticket from the driver. The Almex system, as described in the press release uses "touch in touch out", which is much better.

 

[Robertj21a]

Rotala are actively looking to grow in Manchester following their recent acquisition of Go Goodwins (Little Gem), in addition don't forget 'Opportunity A' from their July Fund Raising, which could see their Manchester fleet expand to 200 buses is still to be concluded. Opportunity B which was NX Hotel Hoppa has only been concluded in the past month.

Any takeover purchase price would reflect the age of fleet, , future business prospects, any pension liabilities & any other risks related to franchising.

But that may suggest that First will have to pay out a lot of money just to get rid of it !

 

[ag51ruk]

Most implementations of contactless mean that you still have to get a paper ticket from the driver. The Almex system, as described in the press release uses "touch in touch out", which is much better.

Despite the press release, that system was not implemented anywhere as far as I know - they bought Almex ticket machines but they have never accepted contactless payment and didn't have touch out facilities. They are now being replaced by Ticketer machines which can accept contactless cards but also don't have touch out.

 

[Volvodart]

You can get a contactless touch card in Aberdeen for the multi operator Grasshopper ticket.

 

[ag51ruk]

You can get a contactless touch card in Aberdeen for the multi operator Grasshopper ticket.

That's an ITSO smartcard, contactless is the ability to pay by Visa/Mastercard/Amex

 

[Volvodart]

You can pay for it by contactless anyway. What is the difference? Does it matter?

 

[ag51ruk]

You can pay for it by contactless anyway. What is the difference? Does it matter?

Not really, but the previous posts were about First accepting contactless payment on-board (which they have only recently started to do, and not yet everywhere)

 

[winston270twm]

But that may suggest that First will have to pay out a lot of money just to get rid of it !

First wouldn't have to pay for anything. But they may be forced to make write-off's based on the current value of any assets they choose to sell off.

It largely depends on how much First Group want the Manchester losses removing from overall UK Bus profits & the level of investment required to turnaround the business if it was to remain part of the group.

 

[SUB62]

W.Yorks start accepting contactless from 18 Jan not sure if this includes phones though.

 

[Goldfish62]

W.Yorks start accepting contactless from 18 Jan not sure if this includes phones though.

When Contactless was switched on in Cornwall a few months ago it covered cards, phones and watches from Day 1, so I assume that's the same everywhere.

 

[DragonEast]

Most implementations of contactless mean that you still have to get a paper ticket from the driver. The Almex system, as described in the press release uses "touch in touch out", which is much better.

I suspect most passengers would want a paper ticket even on a contactless payment. How else do you show you've paid if challenged? (And presumably all on-bus tickets - other than m-tickets, are singles, so the end of the cheaper return fare, though it probably doesn't matter much where there are flat fares in urban areas, like in London)? Certainly I'm always nervous about contactless and want to see evidence the payment has gone through (and only once - it doesn't always work first time). Drivers might want to be protected too. (Not the same for concessions/m-tickets), where you have the evidence to show you are entitled to a free ride, and if the tech doesn't work it's the company's problem, not the passenger's). Though without the id-reading ticket machines the companies must have no evidence where the increasingly popular m-tickets are being used and perhaps a difficulty therefore judging the viability of individual routes!

There are already some cases reported where fares aren't collected, sometimes amounting to thousands £ losses (according to the courts) though how that happens is a mystery to me! I do wonder whether contactless makes such fraud easier, but it is probably more than cancelled out by the cases of erroneous change? I accept it's a drop in the ocean, but any fare losses must be a matter of concern. I know there are problems too with identifying fare stages, and gps isn't infallible, not least because you are not always in range of a satellite. No system is infallible or foolproof.

 

[radamfi]

I suspect most passengers would want a paper ticket even on a contactless payment. How else do you show you've paid if challenged?

But that means having a conversation with the driver, wasting time, and thus taking away a good portion of the potential benefits of contactless payment. In London, contactless payment has been going for several years with no receipts. Actually, if you log into your account, you can see the record of the touch in. It usually only takes a few minutes so you can often see it once you are still on the bus.

Of course, places in Britain and across the world have used smartcards for many years, again without paper receipts.

 

[Harbouring]

But that means having a conversation with the driver, wasting time, and thus taking away a good portion of the potential benefits of contactless payment. In London, contactless payment has been going for several years with no receipts. Actually, if you log into your account, you can see the record of the touch in. It usually only takes a few minutes so you can often see it once you are still on the bus.

Of course, places in Britain and across the world have used smartcards for many years, again without paper receipts.

That only works if there is a flat fare. Considering a single currently ranges from 1.10 to 5.90 where I am depending where you go and add in the fact that contactless is easier to pay for day tickets or week tickets I think there will always be an element of driver manual operating in many areas

 

[radamfi]

That only works if there is a flat fare. Considering a single currently ranges from 1.10 to 5.90 where I am depending where you go and add in the fact that contactless is easier to pay for day tickets or week tickets I think there will always be an element of driver manual operating in many areas

Flat fare is not necessary. Touch in and touch out is already used on buses in several places. The Netherlands and Denmark have nationwide smartcards where touch in and touch out are used to deduct the right bus fare. Trent Barton of Nottingham/Derby also use touch in and touch out for its Mango smartcard.

 

[d1672]

In Glasgow, we have the Glasgow Tripper ticket, which is valid on all First, Stagecoach, Glasgow Citybus, McGills and Whitelaws services. The leaflet from the website says that the ticket is valid to Milngavie on services 10, B10 and C10, and to Mollinsburn on services X37 and X39. These services are only operated by First Midland Bluebird whose ticket machines can't read the smartcards. The drivers just have to take your word that you have a valid ticket on your smartcard. Just thought that I would share this fact with the group.

 

[DragonEast]

A New Year teaser. Do First Bus have any business acumen?

Yes, they can win tenders, by the simple cowboy tactic of undercutting everyone else, no matter what the consequences. And I know that Giles pops up to enthusiastically take the credit with a shopping list of their local successes each year, but I still can't work out whether it's just opportunistic or there is some national strategy that lies behind it? Necessity, maybe.

Otherwise it seems to be a waste it or withdraw it mentality. They simply aren't competitive with any realistic opposition, so they have to either throw-everything-at-it in an effort to persuade the opposition to keep out; or if the opposition persist, then sooner or later withdraw. The business can only go one way, shrink. There are no growth prospects, and neither the resources left over, nor more importantly the will, to try. Isn't it really the cowboy tactic? No strategy to speak of. They are never masters in their own house. Where First thrive, Cornwall, Leicester?/perhaps Norfolk/Suffolk, Wessex and Hants, bits of Manchester and Leeds/York (I don't know about Bristol or South Wales) it's generally because the opposition have topped themselves or don't bother, or Local Government is saving them. It certainly fits the local OpCo in Essex, pattern.

I'd love someone to argue and show I'm wrong, but rather I suspect I'm in (like their passengers) for a long and fruitless wait!

 

[Volvodart]

If you base your opinion on what is posted here I would agree. You do not hear on here about the companies doing OK.

 

[Robertj21a]

A New Year teaser. Do First Bus have any business acumen?

Yes, they can win tenders, by the simple cowboy tactic of undercutting everyone else, no matter what the consequences.

Otherwise it seems to be a waste it or withdraw it mentality. They simply aren't competitive with any realistic opposition, so they have to either throw-everything-at-it in an effort to persuade the opposition to keep out; or if the opposition persist, then sooner or later withdraw. The business can only go one way, shrink. There are no growth prospects, and neither the resources left over, nor more importantly the will, to try. Isn't it really the cowboy tactic? No strategy to speak of. They are never masters in their own house. Where First thrive, Cornwall, perhaps Norfolk, Wessex and Hants, bits of Manchester and Leeds (I don't know about Bristol or South Wales) it's generally because the opposition have topped themselves or don't bother, or Local Government is saving them. It certainly fits the local OpCo in Essex, pattern.

I'd love someone to argue and show I'm wrong, but rather I suspect I'm in (like their passengers) for a long and fruitless wait!

As for First areas that thrive, you've hardly got any of them !

Manchester is a lost cause, Cornwall has improved (but from a disastrous position) and Norfolk is poor, other than Norwich itself. Not sure where you mean by Wessex. The better performing parts of First are West Yorkshire, Glasgow, Aberdeen, Leicester, South Wales etc

 

[overthewater]

As for First areas that thrive, you've hardly got any of them !

Manchester is a lost cause, Cornwall has improved (but from a disastrous position) and Norfolk is poor, other than Norwich itself. Not sure where you mean by Wessex. The better performing parts of First are West Yorkshire, Glasgow, Aberdeen, Leicester, South Wales etc

I dont believe Aberdeen is in a good sharpe ( partly due to the oil turndown), but I'm sure Midland bluebird is doing better along with Portsmouth and York?

 

[DragonEast]

So bluntly, it looks like if there's a future it's with Glasgow/Bluebird/West Yorks and York/Leicester, the traditional northern heartland and probably Aberdeen as their home territory; and a South-West (the original Badgerline bit) Bristol area/Cornwall and South Wales and what I call Wessex (Hants/Dorset/Portsmouth). The rest are essentially legacy operations waiting for something (else) to come along? At least it would be a strategy. And probably one the competition have worked out already! As though, perhaps, we couldn't have worked that one out 5 years, or longer, ago! It's been a long wait.

 

[Cesarcollie]

I dont believe Aberdeen is in a good sharpe ( partly due to the oil turndown), but I'm sure Midland bluebird is doing better along with Portsmouth and York?


Scottish results not published yet but First Hampshire and Dorset is showing £657,000 profit before tax on a turnover of £41m for y/e March 2017. A pretty poor performance by any standard. So if Portsmouth is making good money, it must be cross-subsidising huge losses elsewhere in the company.

 

[overthewater]

So bluntly, it looks like if there's a future it's with Glasgow/Bluebird/West Yorks and York/Leicester, the traditional northern heartland and probably Aberdeen as their home territory; and a South-West (the original Badgerline bit) Bristol area/Cornwall and South Wales and what I call Wessex (Hants/Dorset/Portsmouth). The rest are essentially legacy operations waiting for something (else) to come along? At least it would be a strategy. And probably one the competition have worked out already!

I think first just needs to bite the bullet and pull the rug, and just get rid of four area which are in are in a bad shape, it's been six years now, how many more years of delusion and wasted money can first carry on?

Scottish results not published yet but First Hampshire and Dorset is showing £657,000 profit before tax on a turnover of £41m for y/e March 2017. A pretty poor performance by any standard. So if Portsmouth is making good money, it must be cross-subsidising huge losses elsewhere in the company.

Thats what I'm lead to believe, can anyone confirm?

 

[Dentonian]

As for First areas that thrive, you've hardly got any of them !

Manchester is a lost cause, Cornwall has improved (but from a disastrous position) and Norfolk is poor, other than Norwich itself. Not sure where you mean by Wessex. The better performing parts of First are West Yorkshire, Glasgow, Aberdeen, Leicester, South Wales etc

(Greater) Manchester is a strange one in this sense. From the sale of GMN (& GMS) in 1996 right up to about 2014, First were inferior to Stagecoach in nearly every way; poorer reliability; higher fares; constant service cuts and far more complaints (per passenger) about driver attitude. Its only since Stagecoach has deteriorated in the first three of these criteria, following the bus war prompted by EYMS selling Finglands and wholesale changes in Management, that First seem to have been on the edge of oblivion. Maybe there is something to be said about "Lowest Common Denominator", and it certainly explains the renewed appetite amongst the travelling public for Re-regulation.

 

[Robertj21a]

I dont believe Aberdeen is in a good sharpe ( partly due to the oil turndown), but I'm sure Midland bluebird is doing better along with Portsmouth and York?

Only a few figures for 2017 have been released to date. Others are imminent.

 

[DragonEast]

I think first just needs to bite the bullet and pull the rug, and just get rid of four area which are in are in a bad shape, it's been six years now, how many more years of delusion and wasted money can first carry on?

I don't know, but could it be that First face the classic dilemma that a lot of traditional businesses do: they can neither afford the write-offs to close units nor sell them for a decent price? I have a suspicion about a way to make a cut in this Gordian knot, but they have to identify a Unit they can afford to sell because it's not critical to the business and which is large enough and has enough potential to make it likely to fetch a decent price, to a buyer with the resources and the ability, as well as the interest, and who knows how to negotiate their way around the rules (so not too many punters there, then) . . . and then get it into a decent state for sale, since no one wants a headache . . .

 

[Robertj21a]

I don't know, but could it be that First face the classic dilemma that a lot of traditional businesses do: they can neither afford the write-offs to close units nor sell them for a decent price? I have a suspicion about a way to make a cut in this Gordian knot, but they have to identify a Unit they can afford to sell because it's not critical to the business and which is likely to fetch a decent price to a buyer with the resources and the ability, as well as the interest, and who knows how to negotiate their way around the rules (so not too many punters there, then) . . . and then get it into a decent state for sale, since no one wants a headache . . .

It has been mentioned previously that ANY First UK Bus unit is available for sale. Few of them contribute significant profits so their loss will barely be noticed (and might be a blessing for the Accounts). Those that do some good for the balance sheet (as above - the West Yorkshire/Glasgow/Leicester's of the world) would still need to find a buyer willing to fork out quite a bit of money - and the bus industry in general is not in a very good shape to encourage any such purchasers.

 

[overthewater]

In places like Berkshire why buy when you can make land grabs while it falls apart, just like Northampton. We can't rule out another snap sale within the next 3 months.