(06 Feb 2017, 12:23 pm)eezypeazy wrote 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!
Some interesting points eezypeazy.
However if demand in say the 20 is not high enough to warrant competition; why has the frequency been increased, the route extended, the PVR increased and new vehicles purchased? In fact, when you add other GNE routes in to the mix, the frequency on some sections of the route (say between Houghton and Sunderland), is just as good (if not better), than the combined frequency on sections of the route where there is competition...
All when seeing a gradual increase in fares...
If the route wasn't making money, then I am unsure if new vehicles would be authorised.
If load-factors weren't good, then I am sure a reduced frequency would come in to play. Or, if lowering the frequency wasn't an option, smaller vehicles would have been purchased.
Pump priming a route for such a period of time, wouldn't make sense - unless the initial pump had worked.
All when seeing a gradual increase in fares...
You are right when you say driver pay is calculated on an hourly basis. However, it still contributes to the overall cost per mile. You like maths too based on previous comments, so I won't bother going in to the whole Speed, distance, time thing here.
I also won't refer back to the whole 'carving areas up/feeding drivers raw meat' email convo again either, cos that's been done to death.
There were stories yesterday of Ryanair and how lowering their prices, has seen overall group profits drop. Despite the group witnessing their planes having a higher number of bums on seats.
Passengers are loving the new lower prices. Shareholders aren't too keen.
'Illegitimis non carborundum'