Virgin become first TOC to announce falling revenue

[Pumbaa]

http://business.timesonline.co.uk/tol/business/industry_sectors/transport/article5920640.ece

Interesting. Maybe cutting back to 2tph to Brum and Manchester would be a good idea?

 

[First class]

"It is 51 per cent-owned by Stagecoach and 49 per cent-owned by Sir Richard. "

hmm - im not sure that is correct...

Virgin don't need so many trains Birmingham-London for starters... I also think they should think about withdrawing the Wrexham service- it's not making money between Wrexham and Chester, just eating a path up. They shouldn't be thinking about Shrewsbury either. Another TOC like London Midland would be better suited to such a service.

 

[GNERman]

Actually 49% stagecoach and 51% virgin...

 

[MCR247]

Actually 49% stagecoach and 51% virgin...

i think thats what hes sayins because he put "" "" around it so I think he was quoting and he then said 'I'm sure thats not right' or something

 

[whoshotjimmi]

To suggest Virgin should cut back services is foolish - especially on the busiest parts of the network.

Let's put it into perspective here a bit. The fall is 0.6%. That is to say for every £1000 they are making £6 less. Not exactly time to run to the hills. This is also on a like for like basis. This basically means that passenger numbers have not grown at the same rate as the introduction of services. In fact, the very same article mentions that the group expect to grow by 10% this year. All it means is load factors are a bit lower now there are more trains. Instead of 10 trains with a load factor of 90%, there are 11 trains running at 88%. Like for like revenue rarely paints a true picture. If you give the same number of passengers more travel choice, they are bound to spread out a little bit.

One thing I have found during my time on this forum is that very little business acumen exists. Reducing services as a result of a 0.6% decrease in like for like sales would be suicidal in a business context.

What does annoy me is that Virgin appear to be using 'recession' as an excuse. It is interesting that Stagecoach as a group have reported, in the very same article, like for like increases of 6.7% suggesting th recession is not catching up with rail travel. Better use of the available paths may help - I can't see New Street - Scotland services maximising the full potential of the paths or the trains. Growth prediction is always invariably incorrect due to the many, many factors that can affect it. In this case, Virgin's predictions, for whatever reason, have not been matched.

 

[Metroland]

'The owner of the South West Trains and East Midlands franchises and co-owner of Virgin Trains reported a softening in demand for rail travel. Virgin Trains saw a 3.3% drop in passenger numbers on the west coast line in the 10 months to 1 March, but Stagecoach blamed the slump on engineering works rather than Britain's stuttering economy. South West Trains increased passenger numbers by 1.6% and East Midlands by 2.5% over the same period'

http://www.guardian.co.uk/business/2009/mar/16/stagecoach-recession-hits-demand

http://www.transportbriefing.co.uk/story.php?id=5703

 

[me123]

Could be because more people are choosing not to travel in the recession. I know my Mum's work won't allow people to travel unless necessary any more, and they're having more telephone conferences now than meeting face to face.

 

[voyagerdude220]

Maybe more [leisure] passengers would travel with Virgin from the likes of Preston/Lancaster/Carlisle etc , if the AP singles hadn't increased at the start of the VHF timetable from £20-£40 to at least £90-£100, unless you travel on a very late service.

That's just one example- using discounted First Class singles, but the same applies to Standard Class as well..

 

[anthony263]

maybe all of the train companies should start cutting fares. i know national express & megabus have cut their fares and so are my local bus operators.

 

[charley_17/7]

Perhaps if VWC were better at revenue protection, I might have 'sympathy' for them.

Another issue is them reducing booking office opening times recently.

Within the last year:

Manchester Piccadilly no longer 24hr.
Stockport now closes early evening.
Macclesfield also closes early evening.

The only 'proper' team of RPO's I am aware of are at London Euston, with patchy/non-existant coverage elsewhere.

Crewe - Warrington Bank Quay
Crewe - Wilmslow - Manchester Piccadilly
Stoke - Macclesfield - Stockport - Piccadilly

IMO all these areas/station need gating, because the IC service provides a haven for potential fare dodgers. Hence why Arriva XC got a revenue team in action, because they realised how much they are loosing.

 

[whoshotjimmi]

'The owner of the South West Trains and East Midlands franchises and co-owner of Virgin Trains reported a softening in demand for rail travel. Virgin Trains saw a 3.3% drop in passenger numbers on the west coast line in the 10 months to 1 March, but Stagecoach blamed the slump on engineering works rather than Britain's stuttering economy. South West Trains increased passenger numbers by 1.6% and East Midlands by 2.5% over the same period'

It's obvious. As I have said many times, public transport is in the best possible position to benefit from financial hardship. I am fed up of operators using it as an excuse for poor performance - NXEC springs to mind.

Network Rail have to take a fair portion of responsibility. How many days were services affected by engineering works? Has to be worth 3.3% in itself.

 

[furryfeet]

what evidence do you have of this "lack of gating" being the reason for less journeys being made, rather than, as voyagerdude220 states, the continuing increases in prices, especially after the VHF timetable was introduced.

 

[mathmo]

Perhaps if VWC were better at revenue protection, I might have 'sympathy' for them.

...

IMO all these areas/station need gating, because the IC service provides a haven for potential fare dodgers. Hence why Arriva XC got a revenue team in action, because they realised how much they are loosing.

In my experience, Virgin are indeed rubbish at ticket checking. The last five or so times I've travelled on VT I've not had my ticket checked on train (although departing Euston I usually do). But gates are a right pain with luggage - human barriers and better onboard ticket checking are the way forward. What do the train managers do all journey at the moment? I don't see them checking tickets!

 

[me123]

It's obvious. As I have said many times, public transport is in the best possible position to benefit from financial hardship. I am fed up of operators using it as an excuse for poor performance - NXEC springs to mind.

I don't think this is entirely true. These long distance operators cater for the business and leisure markets. Leisure may be transferring over to the rails, but there'll be a lot of people foregoing a holiday this Summer as well. Also, as I've already said, there are several businesses now minimising travel, and encouraging people to go Standard Class. This can't be good for the Edinburgh or Glasgow-London market.

Your model works better for companies like Scotrail, where paying say £800 for an annual season ticket is cheaper than taking the car and parking the car in Glasgow City. Commuter networks like SWT and EMT will, in my theory, perform better than Virgin.

 

[Stonesourscotty]

Travelled Virgin Many a time and never been ticket checked on a train and only once at a Station (Preston in August last year!) They're really poor at Ticket checking compared to every other company ive travelled with.Other Long Distance operators ive travelled with TPE,EMT,FGW,MML have or are better at ticket checks.

My mate is going Birmingham next week and reckons he wont pay the fare because Virgin rarely ticket check and i hope he gets caught just because i know he will try to avoid paying.

 

[Metroland]

I don't think this is entirely true. These long distance operators cater for the business and leisure markets. Leisure may be transferring over to the rails, but there'll be a lot of people foregoing a holiday this Summer as well. Also, as I've already said, there are several businesses now minimising travel, and encouraging people to go Standard Class. This can't be good for the Edinburgh or Glasgow-London market.

I think that's true. Looking at the latest stats for domestic air, its nothing short of complete and utter market collapse. Its remarkable the long distance train operators haven't been hit more.

http://www.caa.co.uk/docs/80/airport_data_prov/200902/February_2009_Provisional_Domestic_Routes.pdf

 

[gordonthemoron]

My mate is going Birmingham next week and reckons he wont pay the fare because Virgin rarely ticket check and i hope he gets caught just because i know he will try to avoid paying.

But tickets are checked at the barrier in Brum, or is it possible to avoid the barrier by using the lift?

 

[Failed Unit]

I wonder if the AP's are beginning to cut into profits as well. There are many times now I have been able to buy an AP the day before, although I have a feeling that is probably ORCAT's related.

An example on the East Coast is the £174 AP single between London and Edinburgh. I can buy one for the 1700 train on Friday! The open return is only £16 cheaper, so if you don't want the flexibility why would you buy the open? Is it a case that the AP gets more revenue to the operator than the open anyway as they don't need to share it with other operators?

I think in this case engineering work will hurt Virgin, most weekends in the past year have been disrupted so people may have been driving instead (or not travelling).

We will have to wait and see about the summer. Day trips may increase for example, or weekend breaks as people cut back. Don't forget as well that with the Euro price we could have a lot of Europeans using the trains from London - Scotland.

 

[Mojo]

But tickets are checked at the barrier in Brum, or is it possible to avoid the barrier by using the lift?

Depends, I'd estimate that about 1 in 5 days there are people covering the lifts.

Checking tickets at New Street seems to be a very labour intensive operation, it tends to have about 5 ticket checkers at the main entrance, 2 RPIs, 2 RPIs selling tickets and then on footbridge 1C about 2 ticket checkers and 2 or 3 RPIs.

 

[Kneedown]

South West Trains increased passenger numbers by 1.6% and East Midlands by 2.5% over the same period'

Hasn't stopped them running the first class and catering services right down, and proposing to axe job's!
But i suppose running a half decent service comes second to keeping the fatcats happy!

 

[Ferret]

VWC TMs get 3% of their ticket sales as an incentive to check tickets. Problem is, they make that much in FC that they can't be bothered to go into Standard and hoover up the rest. It's as simple as that!

And of course, with a 390 being a 9 coach train, I reckon they lose a fortune between BHM-BHI-COV (as do XC for that matter!) purely because the TM isn't bothered and they have no RPIs...

 

[charley_17/7]

Glad to see its not just me that never seemed to get 'gripped'.

I can only assume VT doesn't care about revenue because they received so much subsidy/compo after the WCRM farce.

Whereas other operators 'desperately' need the revenue, of course.

I work WC routes, and people deliberately prefer to travel on IC services, because they are not challenged on short-hops after Stoke/Crewe.

Worst of all, it means that the number of people ACTUALLY using the trains is less than recorded. So why bother setting targets for modal change, etc.?

If local trains are being used by shoplifters and pickpockets (they get free rides into town), who knows what is happening on these VT services?

 

[Failed Unit]

Does Virgin really need 3tph off peak to Manchester / Birmingham. Now that the operator wants most people to use AP's then in theory 1 very long train per hour would do - not not realistic.

My point really is now we have 1 train every 20 minutes, rather than 1 train every 30 minutes, is that extra train really going to encourage people to take the train rather than drive? Is some one really going to say trains run at 10:00 and 10:30, I want to go at 10:20 so nothing is suitable? From what I have seen myself OFF-PEAK the trains are not that crowded, and the VHF timetable has ruined a lot of local journeys as a result.

Birmingham is well served already, to me surely it would have been better to serve Liverpool 1/2 hourly rather than give Manchester 3 tph.

I know we don't have anything other than Voyagers, but would people be objecting so much to all the Crewe traffic been on the Scotland - Birmingham flows if these were operated by Pendo's as well? I don't think so, the overcrowding is because the trains are too short. Although I can't really think of a reasonable explaination to why the level is of service on board is so poor compared to the Pendo's. When travelling on West Coast I tend to avoid the Voyagers for that reason.

I guess people that use the route a lot will shot me down in flames, but 3tph to me is not needed off-peak, peak yes.

 

[Shinkensgone]

My mate is going Birmingham next week and reckons he wont pay the fare because Virgin rarely ticket check and i hope he gets caught just because i know he will try to avoid paying.

Wow, you're a nice friend to have :roll::roll::roll:

 

[Pumbaa]

If anything, the off-peak service is great. Manchester does need 3tph now, traffic appears to be up. Brum possibly not so. But what if Virgin extended the Wolves service to Liverpool, giving Liv a half hourly service, as well as serving Nuneaton?

 

[merlodlliw]

"It is 51 per cent-owned by Stagecoach and 49 per cent-owned by Sir Richard. "

hmm - im not sure that is correct...

Virgin don't need so many trains Birmingham-London for starters... I also think they should think about withdrawing the Wrexham service- it's not making money between Wrexham and Chester, just eating a path up. They shouldn't be thinking about Shrewsbury either. Another TOC like London Midland would be better suited to such a service.

Well we all know the VT service to Euston from Wrexham was for one reason,
to destabilise W/S, it only got a path into Wrexham, because its bedfellow
ATW allowed this, before W/S VT had no inclination to move into Wrexham.
The part owner of VT stagecoach are experts in killing off any competition,
however we now see a petition on the UK Gov website"novirgintrains"
Assembly members asking the Minister in Cardiff "Who controls the all Wales
franchise, Branson or the Minister for rail in Wales Ieuan Wyn Jones"
The service from Wrexham at 7.00a.m to Euston only carries passengers
who are forced to de train at Wrexham from ATWs Shrewsbury service,
and in fact travel to Manchester/Liverpool & Chester, One passenger a day
on this train to London from Wrexham is less than average and even VTs cut price
fare of £22 one way is not priced so low for no reason.

One wonders is ATW being so nice to VT, a payback for it gaining Cross Country, and make no Mistake with Wrexham/Chester being single track
only ATW giving up more paths can allow VT onto this line.

Sorry VT you are a bully, Wrexham first.

My opinion


Bob

 

[Snapper]

"It is 51 per cent-owned by Stagecoach and 49 per cent-owned by Sir Richard. "

hmm - im not sure that is correct...

It isn't. The figure is the other way around.
--- old post above --- --- new post below ---

Does Virgin really need 3tph off peak to Manchester / Birmingham. Now that the operator wants most people to use AP's then in theory 1 very long train per hour would do - not not realistic.

Trying to encourage people to get out of their cars by only running 1 train per hour would be gross stupidity.

The rail industry does a huge amount of research on what passengers want and on how to attract them. Hence extra services. Virgin are not going to be paying for all that expensive track access on the WCML if they hadn't done their research properly - not to mention all the other operating costs that VHF has added.

But it always amuses me when the armchair experts reckon they know better!

 

[Failed Unit]

It isn't. The figure is the other way around.
--- old post above --- --- new post below ---

Trying to encourage people to get out of their cars by only running 1 train per hour would be gross stupidity.

Why? If you had read my entire post the real question was does it need 3 trains per hour compared to 2? I admit I am not an expert on the route. I asked the question would Manchester extra train not be better for the majority of passengers to serve Liverpool. Please read entire posts before selecting parts to make comment from.

The rail industry does a huge amount of research on what passengers want and on how to attract them. Hence extra services. Virgin are not going to be paying for all that expensive track access on the WCML if they hadn't done their research properly - not to mention all the other operating costs that VHF has added.

Not always, sometimes they run extra service just to increase thier share of the revenue POT - AKA ORCAT's raiding. Was Virgin interested in serving Wrexham until an open access operator showed up - no it is just trying to remove competion.

But it always amuses me when the armchair experts reckon they know better!

Sometimes we do, remember the same question often gets a different answer depending on how it is asked, the rail industry will ask the question in a way that ensures they get the answer they want. Research shows that people prefer direct trains to changing trains, but that didn't stop the rail industry butchering XC's direct network of trains. If the rail industry does so much research and does what passengers want why have so many places lost direct train recently - against the wishes of the users?

 

[Snapper]

Not always, sometimes they run extra service just to increase thier share of the revenue POT - AKA ORCAT's raiding. Was Virgin interested in serving Wrexham until an open access operator showed up - no it is just trying to remove competion.

Virgin cannot ORCATS raid the WCML!
--- old post above --- --- new post below ---

Sometimes we do, remember the same question often gets a different answer depending on how it is asked, the rail industry will ask the question in a way that ensures they get the answer they want.

Oh please! That way businesses go out of business! Virgin are not stupid.

 

[Mintona]

We would like barriers up here, people going to Manchester nowadays try and catch the xx:27 Virgin train, as they know tickets will not be checked, and after 12:45ish we don't have a ticket barrier. So in the evening peak people just wander up past the ticket office and straight onto the 17:27 (invariably late so even more people can catch it) with no ticket and no intention of buying one. The TM can't get up and down the full 9 carriages in the 7 minutes between Wilmslow and Stockport, and then the further 8 minutes into Manchester Piccadilly, so it is a free journey.