tag:blogger.com,1999:blog-979801883485328355.post6014358535105579690..comments2024-03-19T17:57:20.627+00:00Comments on Humber Transport: Fuel Costs put marginal bus services under threatHumber Transporthttp://www.blogger.com/profile/08704677966009159426noreply@blogger.comBlogger1125tag:blogger.com,1999:blog-979801883485328355.post-83574339687959397482008-08-02T18:31:00.000+01:002008-08-02T18:31:00.000+01:00Two things to mention here:1. The claim operators ...Two things to mention here:<BR/><BR/>1. The claim operators make about the cost of fuel "spiralling out of control" is a little rich since they negotiated their current-day fuel prices up to a year ago; therefore it is next year when the pinch will be felt.<BR/><BR/>2. There comes a point when the number of free concessionary travellers actually sees increased profit for the bus operator. Take the following as an example:<BR/><BR/>Service 1 leaves its terminus at 10am and pre-April 2008 carried 20 people: 4 of them fare-paying adults and 6 of them local concessions. The adults contribute a fare of £1.50 each (= total £6.00). The concessions, while travelling for free, cost ERYC £1.00 each, assuming a 66% reimbursement rate. Six of these = £6. Therefore £6 + £6 = £12 for the journey.<BR/><BR/>Now, with the free-for-all, boundary-less concessionary scheme in England, an increase in patronage is seen, albeit by those who travel for free; so let us say 20 people now travel on the same journey: say 6 adults (@ £1.50 each = £7.50) and 14 concessions (free though assuming a 66% reimbursement rate = £14). Now £7.50 + £14 = £21.50, i.e. significantly more than the £12 made prior to the April 2008 scheme.<BR/><BR/>Peter Shipp's EYMS company runs at a much reduced profit margin to the other, larger operators, primarily because his company has strong links with traditions: retaining small, costly depots that are smaller than other companys' outstations. Thus he has been most vociferous in the trade press as the *potential* is there for less revenue to be received as a result in the new scheme. What, say, if the free-for-all hadn't resulted in increased numbers and if fewer people used his services? He'd be able to absorb the costs a lot less than neighbouring operator Stagecoach; indeed it's no coincidence that EYMS announced its cut-backs first for this reason. However EYMS's 'beef' is mainly the cost of fuel with the concessionary scheme thrown in as well. You'll note Peter Shipp quotes the £55,000 increase in fuel but mentions nothing about the cost the concessionary scheme is having, primarily because there isn't one and stating that profits are up as a result of the scheme, in the same press release as the cutting back of services due to fuel costs, would not be well received.<BR/><BR/>One of the main culprits is EYRC and Hull City Council, both of whom were, as I understand it, leaving their reimbursement rate decisions to the latest possible point in time before informing operators what they were likely to receive, though local government bureaucracy is one thing we can all rely on as never changing!Anonymousnoreply@blogger.com