Is there demand for more sleeper services?

[Bald Rick]

I think I saw a stat that said a 1/4 full Voyager and a full jet would have the same emissions. Though impact of contrails varies from one CO2 calculator to another.

There’s all sorts of stats, but many are based on average emissions of a vehicle rather than what really matters, which is how much fuel is burnt to carry x number of people. Where it gets difficult is working out what x is for the train, especially where that service doesn’t run (.and never will!)1

 

[popeter45]

i think the nearest we could realistically see of a west coast sleeper would be like what DSB have for the overnight Hamburg to Copenhagen route
XC or someone similar putting a standard train like a voyager as a overnight with seating only, no specialised stock so can still earn revenue in the day and no complex fare structure as just a standard or first class ticket, still highly unlikely

 

[43096]

Your market estimates are also still way off.

Oh how ironic for you to say other people's estimates are way off, after your cost guesses were thoroughly debunked.

Can you quote us some figures on this market, or is it just dream-world again?

 

[BigCj34]

Yep they can. They could turn a profit with 2 aircraft, and indeed Easyjet did that 25 years ago.

The airlines will be smaller operations of course, but they know their cost base extremely well, and have low overheads. Cheap flights are here to stay.

Ryanair have stayed out of the news which is a good thing for them, and they are ruthless with routes. Easy jet have closed a bunch of bases too.

The other factor that could affect them, is prospective climate taxes. If we don't want to be burning alive and/or live underwater by 2050 then we cannot all be flying cheaply!

 

[BigCj34]

i think the nearest we could realistically see of a west coast sleeper would be like what DSB have for the overnight Hamburg to Copenhagen route
XC or someone similar putting a standard train like a voyager as a overnight with seating only, no specialised stock so can still earn revenue in the day and no complex fare structure as just a standard or first class ticket, still highly unlikely

The tickets would have to be cheap enough to entice people to travel on a Voyages overnight, and then it might not be economical. However it would form the basis of peak early morning services on the latter stages of the route which could help cover the cost.

 

[telstarbox]

That makes sense to use existing assets in dead time (if the maintenance and track access requirements allow it).

Commissioning brand new stock for a route with a niche market would be courageous. I trust @Bald Rick on the numbers!

 

[SussexLad]

Oh how ironic for you to say other people's estimates are way off, after your cost guesses were thoroughly debunked.

Can you quote us some figures on this market, or is it just dream-world again?

All you have to do is look at airport traffic to edinbrugh and glassgow from the region. Just Cardiff to Edinbrugh was 102k passengers in 2018. Glasgow to Bristol was 300k in 2018. Bristol to Edinbrugh is 400k in 2018. Then flybe collapsed. Also account for the road traffic which I haven't quite mastered. Given the longer distance achieving an average price of £250 per person per way is possible.

You could likely fill an 8 to 10 carriage train at an average of 80% occupancy. Resulting in 200k capacity a year. Easy to fill given the demand.

 

[43096]

All you have to do is look at airport traffic to edinbrugh and glassgow from the region. Just Cardiff to Edinbrugh was 102k passengers in 2018. Glasgow to Bristol was 300k in 2018. Bristol to Edinbrugh is 400k in 2018. Then flybe collapsed. Also account for the road traffic which I haven't quite mastered. Given the longer distance achieving an average price of £250 per person per way is possible.

You could likely fill an 8 to 10 carriage train at an average of 80% occupancy. Resulting in 200k capacity a year. Easy to fill given the demand.

What makes you think they'll pay £250 when, with a quick check on the web, I can see flights from Bristol to Edinburgh for around £25 with a flight time of about 75 minutes. Yes, I know there is the check in faff and getting to/from the airport, but the cost differential is a killer.

 

[Energy]

All you have to do is look at airport traffic to edinbrugh and glassgow from the region. Just Cardiff to Edinbrugh was 102k passengers in 2018. Glasgow to Bristol was 300k in 2018. Bristol to Edinbrugh is 400k in 2018. Then flybe collapsed. Also account for the road traffic which I haven't quite mastered. Given the longer distance achieving an average price of £250 per person per way is possible.

You could likely fill an 8 to 10 carriage train at an average of 80% occupancy. Resulting in 200k capacity a year. Easy to fill given the demand.

But ~1.2 million people a year fly from London Heathrow to Edinburgh alone and another ~500k from London City to Edinburgh (both from 2018, same year as your figures) and a large amount of people will travel by day train yet the CS still requires a large subsidy. (Source for my figures)

 

[SussexLad]

But ~1.2 million people a year fly from London Heathrow to Edinburgh alone and another ~500k from London City to Edinburgh (both from 2018, same year as your figures) and a large amount of people will travel by day train yet the CS still requires a large subsidy. (Source for my figures)

There's no way you'd fit 1.2 million people on the calidonian sleeper. So the economies of scale are their to facilitate cheaper flight prices making the sleeper less attractive. I suppose in a weird way the market is too big for the sleeper to compete effectively.

The smaller, more spread out markets would make it easy for a South wales and south west service to dent the demand enough that air routes are unviable leaving people with less choice and more willing to pay £250 per room for a premium, modern and luxury experience that saves them many hours.

Plus for businesses, they wouldn't have to pay for someone to sit on a train or plane for however many hours because they're drinking, eating and sleeping on a sleeper so is reasonable that they don't pay for those hours.

Basic economics...

 

[Tobbes]

There's no way you'd fit 1.2 million people on the calidonian sleeper. So the economies of scale are their to facilitate cheaper flight prices making the sleeper less attractive. I suppose in a weird way the market is too big for the sleeper to compete effectively.

The smaller, more spread out markets would make it easy for a South wales and south west service to dent the demand enough that air routes are unviable leaving people with less choice and more willing to pay £250 per room for a premium, modern and luxury experience that saves them many hours.

Plus for businesses, they wouldn't have to pay for someone to sit on a train or plane for however many hours because they're drinking, eating and sleeping on a sleeper so is reasonable that they don't pay for those hours.

Basic economics...

Which all begs the question that if it is 'basic economics', why no open access operator is currently pitching this service, subsidy free....?

 

[SussexLad]

Which all begs the question that if it is 'basic economics', why no open access operator is currently pitchign this service, subsidy free....?

Initial outlay is a lot. Easier to do post flybe collapse but covid has meant most operators are in financially turbulent.

Or the risk verses return isn't worth it. Could be profitable but there might be better uses for that money, like a competitor to eurostar (random thought, they charge a lot with not great service).

 

[Bald Rick]

All you have to do is look at airport traffic to edinbrugh and glassgow from the region. Just Cardiff to Edinbrugh was 102k passengers in 2018. Glasgow to Bristol was 300k in 2018. Bristol to Edinbrugh is 400k in 2018. Then flybe collapsed. Also account for the road traffic which I haven't quite mastered. Given the longer distance achieving an average price of £250 per person per way is possible.

You could likely fill an 8 to 10 carriage train at an average of 80% occupancy. Resulting in 200k capacity a year. Easy to fill given the demand.

You might have missed post 101 where I explained the London - Scotland air market (6m pa) and compared it to the South Wales / SW England air market (less than 1m).

Plus for businesses, they wouldn't have to pay for someone to sit on a train or plane for however many hours because they're drinking, eating and sleeping on a sleeper so is reasonable that they don't pay for those hours.

Basic economics...

But businesses don’t pay extra for people travelling in work time, so there is no saving in cost. Indeed, if using the day train, or even flying, many people will work on the train / plane or waiting at the station / terminal . I certainly do as do many of my colleagues. And then the company doesn’t have to pay for dinner, drink, and a rather high sleeper fare.

May I ask if you have any economics qualifications because this most definitely isn’t basic economics.

 

[Tobbes]

Initial outlay is a lot. Easier to do post flybe collapse but covid has meant most operators are in financially turbulent.

Or the risk verses return isn't worth it. Could be profitable but there might be better uses for that money, like a competitor to eurostar (random thought, they charge a lot with not great service).

Reasonable answers, both of which are 'basic economics'.

Could a Penzance/Swansea-Bristol Parkway-Newcastle-Edinburgh-Glasgow* sleeper service be run?

Sure.

But it will need to have someone (government, presumably) fund the costs of:

- say 25 sleeping cars (5 Penzance-Bristol portion (1 x RLO; 1 x FO; 2 x SLE; 1 x SLED) 5 Swansea-Cardiff-Bristol portion = 10 northbound, same southbound plus spares, though perhaps the numbers could be mitigated if fully integrated with the existing CS pool),

- capital costs at Bristol to allow for the routine shunting of occupied rolling stock,

- and the purchase/hire/refurbishment of diesels/electrics (2 x Type 4/5 diesels plus 2 x class 90/91/92 plus spares),

- set up costs and operating losses for 18-24 months to allow the business to make an operating profit in year 3. (I can't imagine it would ever be profitable, and less likely still that it would be profitable enough to pay back the capital costs of the investment.)

So, it begs the question that we began with; not could this be done (it could, relatively easily given a large enough budget), but is it a high enough public spending (and specifically transport spending) priority to make it happen? And transparently, no it is not, becuase otherwise the government would be shouting it from the rooftops and actually doing it.

*At a minimum of 669m 48ch or thereabouts, this is some trip end-to-end! (In fact, this is Railmiles shortest, so in practice it would likely be further, especially if you swapped to electric haulage in Birmingham).

 

[Bald Rick]

Initial outlay is a lot.

The thing is, it isn’t.

You could set up a small open acces operator for a couple of million upfront, indeed in some cases rather less. Many have done so - just look at Mr Yeowart.

Very few assets, as everything is leased. A prospective operator just needs to work out the market, get provisional leasing arrangements for rolling stock, agree with an accredited operator to run the trains under a safety case, and agree a track access contract. Once that is done its simply a case of hiring the staff, arranging to sell tickets, and activating all the provisional contracts.

There’s plenty of open access operator s who have done this, and some of them have even succeeded. But none have gone for a sleeper operation. That is a significant clue to the economics.

 

[SussexLad]

The thing is, it isn’t.

You could set up a small open acces operator for a couple of million upfront, indeed in some cases rather less. Many have done so - just look at Mr Yeowart.

Very few assets, as everything is leased. A prospective operator just needs to work out the market, get provisional leasing arrangements for rolling stock, agree with an accredited operator to run the trains under a safety case, and agree a track access contract. Once that is done its simply a case of hiring the staff, arranging to sell tickets, and activating all the provisional contracts.

There’s plenty of open access operator s who have done this, and some of them have even succeeded. But none have gone for a sleeper operation. That is a significant clue to the economics.

Interesting thoughts. It is possible but I am no fan of leasing assets. Espeacially as tue owner could argue there is limited chance for reassignment of the assets should the venture fail. Meaning sky high leasing bills. Probably a better long term solution is a lot of money to buy at least some of the key assets.

Leasing the seated coaches and club cars is probably more affordable tho. Same with the loco.

 

[Tobbes]

Either way, no one has done it.....

 

[Journeyman]

Interesting thoughts. It is possible but I am no fan of leasing assets. Espeacially as tue owner could argue there is limited chance for reassignment of the assets should the venture fail. Meaning sky high leasing bills. Probably a better long term solution is a lot of money to buy at least some of the key assets.

Leasing the seated coaches and club cars is probably more affordable tho. Same with the loco.

You want to *buy* Sleepers for a service that was axed 25 years ago because its main market disappeared?!?!?

You might be interested in knowing who made the decision to axe the Scotland to Cornwall sleepers. He ended up being MD of Caledonian Sleeper, so I suspect he knows more about this than you. If there was a fortune to be made, why didn't Serco fill their boots?

 

[CBlue]

I think it's become quite clear this won't happen.

 

[Journeyman]

I think it's become quite clear this won't happen.

It was abundantly clear 25 years ago.

 

[The Ham]

Yeah. There's going to be a lot of spare aircraft and desperate airports!

However, conversely a lot of those aircraft would stop being viable to use within a fairly short time and so unless someone is willing to take them on within the next few months then chances are they'll no longer be viable to use.

The other thing to bear in mind is that they are likely to be the older aircraft which are being got rid off and, in the case of a load of BA ones, are things like 747's which are hardly ideal for local flights.

I'd guess that the landing costs charged by the smaller airports aren't that much anyway (with them making much of their money from parking charges, shop leases, etc.) when you look at the overall costs of the airlines.

Whilst other costs (such as fuel) will have fallen, business is likely to see that many of their meetings can be done online and so would be less inclined to fly. As such the demand for flying is likely to be suppressed for some time.

Finally, if there's a significant fall in employment then there's likely to be impact on leisure travel.

Overall the likelihood of there being many new routes starting up in the next 6 months is likely to be low, especially with the uplift in cases in Covid-19 which are being seeing in some areas/countries.

As such those aircraft which were doing (say) UK Spain being used for other purposes, as more limits are put in place that's going to reduce routes available and so limit the scope for new entrants.

 

[Bald Rick]

However, conversely a lot of those aircraft would stop being viable to use within a fairly short time and so unless someone is willing to take them on within the next few months then chances are they'll no longer be viable to use.

The other thing to bear in mind is that they are likely to be the older aircraft which are being got rid off and, in the case of a load of BA ones, are things like 747's which are hardly ideal for local flights.

I'd guess that the landing costs charged by the smaller airports aren't that much anyway (with them making much of their money from parking charges, shop leases, etc.) when you look at the overall costs of the airlines.

Whilst other costs (such as fuel) will have fallen, business is likely to see that many of their meetings can be done online and so would be less inclined to fly. As such the demand for flying is likely to be suppressed for some time.

Finally, if there's a significant fall in employment then there's likely to be impact on leisure travel.

Overall the likelihood of there being many new routes starting up in the next 6 months is likely to be low, especially with the uplift in cases in Covid-19 which are being seeing in some areas/countries.

As such those aircraft which were doing (say) UK Spain being used for other purposes, as more limits are put in place that's going to reduce routes available and so limit the scope for new entrants.

Quite the opposite.

With so many serviceable airframes off lease, airlines - including new entrants - are going to have a very strong negotiating position when it comes to leasing deals. The owners of leased aircraft, or at least those that don’t go bust, will be selling cheap to get any revenue on their assets.

Whilst I agree that the next six months (indeed 18 months) will be tricky for the air industry, with much restructuring of networks and individual airlines, there will still be plenty of opportunity for airlines to make money and capitalise on the market that is there. Given how many planes have flown over my house going to or from Luton in the last 2 hours I’d say they are doing ok now.

 

[Journeyman]

Quite the opposite.

With so many serviceable airframes off lease, airlines - including new entrants - are going to have a very strong negotiating position when it comes to leasing deals. The owners of leased aircraft, or at least those that don’t go bust, will be selling cheap to get any revenue on their assets.

Whilst I agree that the next six months (indeed 18 months) will be tricky for the air industry, with much restructuring of networks and individual airlines, there will still be plenty of opportunity for airlines to make money and capitalise on the market that is there. Given how many planes have flown over my house going to or from Luton in the last 2 hours I’d say they are doing ok now.

I think it's a very bad time to be an employee of Airbus or Boeing, but if you run an airline and you're looking to modernise your fleet, it's a fantastic time to do it. Loads of fairly new planes will get dumped on the secondhand market, and it's a golden opportunity to shed your older gas-guzzlers and get a modern fleet for peanuts.

 

[SussexLad]

Quite the opposite.

With so many serviceable airframes off lease, airlines - including new entrants - are going to have a very strong negotiating position when it comes to leasing deals. The owners of leased aircraft, or at least those that don’t go bust, will be selling cheap to get any revenue on their assets.

Whilst I agree that the next six months (indeed 18 months) will be tricky for the air industry, with much restructuring of networks and individual airlines, there will still be plenty of opportunity for airlines to make money and capitalise on the market that is there. Given how many planes have flown over my house going to or from Luton in the last 2 hours I’d say they are doing ok now.

I agree with regards to new airlines being in a strong negotiating position, the discounts will only go so far tho it is better to keep aircraft with less cycles on them.

I would suggest that any new airlines are more likely to follow a Jet2 model or similar.

 

[Bald Rick]

Worth pointing out that anyone in the south west of England or Wales who wants to be in Scotland for breakfast tomorrow just needs to book with Easyjet for £78 now and present themselves at Bristol airport at around 6am tomorrow morning.

This is the reality of the competition.

 

[Energy]

Worth pointing out that anyone in the south west of England or Wales who wants to be in Scotland for breakfast tomorrow just needs to book with Easyjet for £78 now and present themselves at Bristol airport at around 6am tomorrow morning.

This is the reality of the competition.

And it will be even cheaper if you book earlier on and not last minute.

 

[Journeyman]

And it will be even cheaper if you book earlier on and not last minute.

I live near Edinburgh, and used to work for a company with an office in Bristol I needed to visit occasionally. I could fly there and back the same day and still get a full day in the office, and in total it was about £60 return if booked reasonably far ahead. Not that I had to pay for it, but hey.

No way can a Sleeper compete with that.

 

[WideRanger]

Sleeper services do seem to be rather expensive, and looking at the sort of costings that Bald Rick sets out, it seems pretty clear that a traditional sleeper wouldn't cover its costs.

I have always wondered (and I may well have suggested it before) whether something that is really cut back in terms of cost would be more financially viable, especially on more marginal routes. Or could provide a more affordable alternative to the premium services we have now.

So for example.
Based on converted 155s (or 156s), extended with 153s if there was sufficient demand. Could also do portion working easier than locomotive + carriages.
Strip out all of the seats. And have people sleep in one big open space on the floor. Just like on some Japanese trains and lots of Japanese ferries. Clearly, there is no privacy, but equally, a lot of people would find it less intimidating to be in an open carriage with 50 people than in a shared room with a stranger.

Services on board would be very basic. One toilet per carriage. No seats (or, at best, flip down seats). No Air Conditioning (but openable hopper windows). Minimal bedding. Lights dimmed at fixed times. Earbuds if you want quiet. Automatic vending machine for drinks / light meals. Minimal staffing on the train. Use secondary stations for termination in London, if that makes a useful difference (e.g Finsbury Park, Stratford).

It would seem to that this model would have significantly lower costs that the sort of sleepers we are running now. But would it be low enough so that the price could be attractive to the sort of people who would tolerate such lower levels of comfort?

Or have I allowed myself too much of a flight of fancy?

 

[Journeyman]

Or have I allowed myself too much of a flight of fancy?

Yes.

 

[Energy]

Sleeper services do seem to be rather expensive, and looking at the sort of costings that Bald Rick sets out, it seems pretty clear that a traditional sleeper wouldn't cover its costs.

I have always wondered (and I may well have suggested it before) whether something that is really cut back in terms of cost would be more financially viable, especially on more marginal routes. Or could provide a more affordable alternative to the premium services we have now.

So for example.
Based on converted 155s (or 156s), extended with 153s if there was sufficient demand. Could also do portion working easier than locomotive + carriages.
Strip out all of the seats. And have people sleep in one big open space on the floor. Just like on some Japanese trains and lots of Japanese ferries. Clearly, there is no privacy, but equally, a lot of people would find it less intimidating to be in an open carriage with 50 people than in a shared room with a stranger.

Services on board would be very basic. One toilet per carriage. No seats (or, at best, flip down seats). No Air Conditioning (but openable hopper windows). Minimal bedding. Lights dimmed at fixed times. Earbuds if you want quiet. Automatic vending machine for drinks / light meals. Minimal staffing on the train. Use secondary stations for termination in London, if that makes a useful difference (e.g Finsbury Park, Stratford).

It would seem to that this model would have significantly lower costs that the sort of sleepers we are running now. But would it be low enough so that the price could be attractive to the sort of people who would tolerate such lower levels of comfort?

Or have I allowed myself too much of a flight of fancy?

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