Pricing
Pricing
(06 Feb 2017, 12:23 pm)eezypeazy Interesting stuff. Two things come immediately to mind...
1. Isn't there a danger in conflating an individual passengers' fare per mile with the vehicle's BSOG rate per mile? That is, the BSOG enhancement of 6p/kilometre (about 10p per mile) ought to be divided by the average number of passengers on the vehicle to see the difference the BSOG enhancement makes to each person. In other words, the BSOG enhancement per passenger could well be just fractions of a penny.
2. Its very likely that all these factors (such as average fares paid, ENCTS reimbursement, BSOG and BSOG enhancements, changes to fuel efficiency and maintenance costs, depreciation costs, plus any growth/reduction in passenger numbers) have already been taken into account by the Company as part of its case to justify investing in the new vehicles in the first place - which, all in all, must be quite a complex calculation. For example, a LCEB certified Solo is probably almost twice as fuel efficient as a 12 or 14 year old MPD, and ought to have lower maintenance costs, but the MPD will be fully depreciated while the new Solo will attract depreciation costs.
And, of course, not all costs are 'per mile' - staff costs are 'per hour.' And some buses carry more passengers than others - and sometimes a bus carries more people at some times of the day than at others. That competition exists on some routes probably has more to do with the fact that lots more people travel on those routes, so that the price per person per mile ought to be able to be lower anyway. Routes without competition most likely means that there's simply not enough passengers around for operators to wish to compete.
But all in all, I agree - fares could well be higher if the bus fleet was older, less fuel efficient and more difficult to keep on the road!
(06 Feb 2017, 12:23 pm)eezypeazy Interesting stuff. Two things come immediately to mind...
1. Isn't there a danger in conflating an individual passengers' fare per mile with the vehicle's BSOG rate per mile? That is, the BSOG enhancement of 6p/kilometre (about 10p per mile) ought to be divided by the average number of passengers on the vehicle to see the difference the BSOG enhancement makes to each person. In other words, the BSOG enhancement per passenger could well be just fractions of a penny.
2. Its very likely that all these factors (such as average fares paid, ENCTS reimbursement, BSOG and BSOG enhancements, changes to fuel efficiency and maintenance costs, depreciation costs, plus any growth/reduction in passenger numbers) have already been taken into account by the Company as part of its case to justify investing in the new vehicles in the first place - which, all in all, must be quite a complex calculation. For example, a LCEB certified Solo is probably almost twice as fuel efficient as a 12 or 14 year old MPD, and ought to have lower maintenance costs, but the MPD will be fully depreciated while the new Solo will attract depreciation costs.
And, of course, not all costs are 'per mile' - staff costs are 'per hour.' And some buses carry more passengers than others - and sometimes a bus carries more people at some times of the day than at others. That competition exists on some routes probably has more to do with the fact that lots more people travel on those routes, so that the price per person per mile ought to be able to be lower anyway. Routes without competition most likely means that there's simply not enough passengers around for operators to wish to compete.
But all in all, I agree - fares could well be higher if the bus fleet was older, less fuel efficient and more difficult to keep on the road!
