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The Routledge Handbook of Transport Economics

Jonathan Cowie, Stephen Ison

Bus economics

Publication details https://www.routledgehandbooks.com/doi/10.4324/9781315726786.ch3 Peter White Published online on: 04 Aug 2017

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(fuel, larger element distance-based relatively purely a fuel and total, the of proportion smaller a forms Britain, Table Britain in pattern typical The 3.2.1 costs operating of structure The 3.2 on is throughout focus cases main The internationalisation through growing market. notably the contract and the examined, Chile) of (especially also practice regulatory are the in aspects and variations sharp systems international with regulatory but different of available, experience literature is extensive emphasis research the main given The Britain, examined. are from then modes evidence are other systems on costing vis-à-vis regulatory examining different share operations, of market impacts bus and The demand of considered. affecting economics factors the Other of concepts. principles pricing basic and the out sets chapter This Introduction 3.1 icsinblw.Tefe lmn lovre oesapywti ie onr nteshort the in country given a further within (see sharply to policy more due taxation varies term, to also according element vary fuel The will below). component discussion cost fuel the although levels, terms). head absolute in lower not are (but in operators proportion Overheads of smaller case 40%). 10%. a costs the refl form in about about and east, proportion south form larger comprise 20%, a the leasing, form approximately and drivers to London and are tend which costs depreciation parts) Staff-related (of 9%. i.e. spare about costs comprise provision, and total vehicle (fuel of with run 60% associated distance at to staff, related to Components directly related costs h xeineo xrs oc eeuainwihhspoue oehtdfeetoutcomes different buses. somewhat local to produced made of has also that which is to deregulation reference coach but express trips), of passenger experience short the handling kerbside, mainly intervals, frequent tflosfo hssrcueta otcssvr ytm,rte hndsac ssc.The such. as distance than rather time, by vary costs most that structure this from follows It ral qiaetptenmyb sue nohrcutiso iia elicm per income real similar of countries other in assumed be may pattern equivalent broadly A 3.1 ae nwr yteTScnutny tcnb enta h ags lmn nthose in element largest the that seen be can It consultancy. TAS the by work on based hw eetetmt ftepretg opsto flclbsoeaigcssin costs operating bus local of composition percentage the of estimate recent a shows fl cutosi ol i rcs nlwricm onre sc sIda,labour India), as (such countries lower-income In prices. oil world in uctuations cighge tf anns n h te lmnsb de by elements other the and earnings, staff higher ecting ‘ u economics Bus local ’ u evcs(..toesopn at stopping those (i.e. services bus ee White Peter fi nition 3 31 ’ Downloaded By: 10.3.98.104 At: 10:42 26 Sep 2021; For: 9781315726786, chapter3, 10.4324/9781315726786.ch3 e asne ioer yalpbi rnpr oe vrgn bu 3pnei 2014 – in pence 23 about averaging modes 5.1). table transport is 2015, capital) public London, approach (including all for cost comprehensive (Transport resource by more total trip kilometre a of passenger passenger estimates London, per publishing per In London cost effects). for cover Transport length also with trip found, Britain distinguish in not published do data by (which than affected Government rather is of which carried. kilometres), kilometres), allocation (bus load passenger or the output average trips to intermediate to (passenger produced an guide (subject being measures output poor comparisons ultimate also a the It cross-sectional is operation. this making an applicable), within and being costs below) conditions (as operating time further over similar trends discussed assessing broadly in data useful While run. British kilometre bus in per cost operating an give to costs 2 vrg pe tand ic h ihrtesedtelwrtetm-ae ot per costs time-based the lower the speed the higher the since attained, speed Average (2) elwrweeolder where lower be navhcenmesbss ic h cl fdpt n diitaiesrcueaelargely are structure administrative and depots between of drawn be scale also the may distinction allocated since A generally this. basis, also by are determined numbers staff, vehicle administrative annum. for a per those and on vehicle costs, per Overhead charge charge. leasing a the as expressed normally is a component provision, important Where other vehicle The with 1949). (Buckpitt, associated ago years that 60 over out pointed was indicator White Peter 32 allocation. overhead and costs capital vehicle both determining service, the for PVR The (1) apply: also will factors following speci to costs allocating In network a within costs Allocating 3.2.2 percent 90 about of ..tenme fvhce nsriea h uis eid(yial h onn rafternoon or morning the (typically well-maintained period total a busiest Typically, and tenance). the Friday), at to service Monday in peak, vehicles of number the i.e. sasml esr fui prtn ot,ttlbsklmte u a edvddit total into divided be may run kilometres bus total costs, operating unit of measure simple a As ioer run. day. kilometre the costs of unit most higher for much running have those to than tend kilometres periods bus peak at per mainly out carried operations Hence, olwd vrg aorcs e ori omlyhge hnfor than higher normally is hour per cost labour average followed, aorcssfrpa-nyoeain a lob ihrprhu okd u to due worked, hour per higher be also may operations peak-only dif for costs Labour fi fl ute nshdln ef scheduling in culties e sdrcl we,ti ilcmrs h ercaincag u,o hr leased, where or due, charge depreciation the comprise will this owned, directly is eet rnpr’ 0Ags 2013 August 30 Transport’, Source Claims leasing and Depreciation parts) Overheads (fuel, run distance with varying Costs drivers) which, (of Labour 3.1 Table A atesi,‘u nutyPromne21’ spbihdi ‘Passenger in published as 2013’, Performance Industry ‘Bus Partnership, TAS : – fl oa u otsrcuei rti,2011–12 Britain, in structure cost bus Local ..aPRo 0wudcrepn oa to correspond would 90 of PVR a i.e. esaeoperated. are eets fi at fa prto sc sapriua ot rtm eid,the period), time or route particular a as (such operation an of parts c fi inl o hsproe(vnwhere (even purpose this for ciently fl e ie(hc loicue eilsudron main- undergoing vehicles includes also (which size eet fl e eee trglritraswl aea availability an have will intervals regular at renewed eet ‘ ekvhcerequirement vehicle peak fl e prtdo 100 of operated eet ‘ pi shift’ split ‘ 3.0% 10.0% 19.9% (40.1%) 58.4% tagtshift’ straight 8.6% okn is working – ’ u may but (PVR), work). 15 Downloaded By: 10.3.98.104 At: 10:42 26 Sep 2021; For: 9781315726786, chapter3, 10.4324/9781315726786.ch3 4 ntcssa eid flwdmn tpclyerymrig,eeig n udy;and Sundays; and evenings mornings, early (typically demand low of periods at costs Unit (4) atr,mysml et nraesed,truhbspirte n euigdeltm tstops Increased London). at regulatory in time eliminated completely or dwell now reducing kilometre payment, ownership and fare bus priorities cash of minimising per bus irrespective by through cost example, speeds, costs, (for unit increase reducing and to distance-related), be of are simply may costs total means pattern, that of effective so 10%), 20% most by (if (i.e. The buses 8% 11 likewise. about 60 to by this of increase rise time increase thus small would will trip minutes) very cost round 6 a to Even a drivers. (up and with time buses trip route ten round require a in would example, minutes 6 For of place. headway and takes minutes frequency where even service costs increase in thus increase may reliability, no service ensure to need the and congestion, Growing aito ntenme fjuny prtdwti hspro,btasapdo nteevenings, the in 2014). little drop Transport, sharp indicate for a data period but (Department period, aggregate London the this outside Recent within especially operated throughout work. journeys of to/from school level number meet journeys the to service in often adult variation peaks, similar than the at rather a enhancements demand, has small offering this only travel with operation, Britain 1800 peak-only and in of 0800 costs around operators between marginal mini- high most to the in commitments with Coupled involve resulted at pay. agreements levels and shift-working peak time if the shift especially below mum substantially small, services be travel cutting may concessionary of times free cost such to avoidable due the (notably and loadings people), older good for reasonably attracts often 1600) and re 0900 to raised then are fares where impacts and secondary time) journey large in-vehicle greater plus to costs, (due operating demand number passenger a on effects in direct term Begg with long areas, the by urban over work of times journey Recent bus scheduled emissions. in increase increases dramatic and shown consumption has (2016) fuel worsen to tends also congestion 3 eil ie aia ot,fe osmto n aneac lal iewt eil size, vehicle with rise clearly maintenance and consumption fuel costs, capital size: Vehicle (3) a eepce,snetemi opnns(rvr,ohrsaf uladsae)sml iein rise simply spares) and fuel staff, other (drivers, costs operating components direct main in the scale of since economies expected, few that be is may structure cost this of consequence further A scale of Economies 3.2.3 ncnrs oeeigadSna ok the work, Sunday and evening to contrast In eil iea uh n nBianti einlvraini o uhmr oiebethan arti noticeable more an much removing now component, is size variation regional vehicle this the Britain in and such, as size vehicle ie,cs e asne rpmyb ihdet orlaig,otnrsligi such in resulting often loadings, such poor where at even to basis average due tendered overall a high on the be only than provided may being In lower trip services work. are passenger to weekday kilometre per than degree bus cost higher the per or times, affecting costs lower work), are although However, run Sunday cases, hour demand. for many per terms, peak rates costs kilometre operating meeting higher marginal (e.g. bus in overheads which vary incurred in of may costs been lower since agreements already be adopted, wage have is often approach provision will costing vehicle escapable run) and or are marginal a operations if such especially where night all kilometre place passenger per costs unit size, sharply. vehicle fall with generally rise costs operating total While re to tend will wage market-based a term, longer vrtesm ot uigMonday during route same the over de (locally hs nBian(rm18)mc oe ae eeotnngtae for negotiated often were rates lower much 1986) (from Britain in phase lhuhntncsaiyport.Lbu ot a lovr,atog hswl eedon depend will this although agreements working vary, local also of may pattern costs the Labour rata. pro necessarily not although fi e) norgn iepedaoto fti eil ye oee,i the in However, type. vehicle this of adoption widespread encouraging ned), – audydyieperiods. daytime Saturday – o xml,i h meit post-deregulation immediate the in example, for ‘ interpeak fi ilicniet h s fsalrvehicles. smaller of use the to incentive cial fl c h oa aormre ahrthan rather market labour local the ect ’ eid(htbtenapproximately between (that period ‘ commercial fl c ihrcosts. higher ect ’ ‘ minibus evcsoperate services u economics Bus ’ drivers 33 Downloaded By: 10.3.98.104 At: 10:42 26 Sep 2021; For: 9781315726786, chapter3, 10.4324/9781315726786.ch3 u rp 6.%.Ti i rdcsafil odblneo ekaditrekdmn,albeit demand, interpeak and peak of balance good total fairly of peak majority a a for produces form mix times, proxy other This a at The (62.8%). occur trips). As trips bus speaking, bus all broadly (8.6%). of which, (37.2% purposes, share together other taken market all be for may highest trips purposes trip second education its and work holds the that demand, bus for modes which all within by purpose travel of holds bus which share the and purpose, purpose. trip by demand bus local en ena oe ikb edr,o en bet as qiycptlo h tc akt and market) stock by the on (either capital easily equity more raise capital to able raise being to or able lenders, fi be by vehicles risk also and lower may spares as They fuel, seen of being operators. purchase smaller in to suppliers available with not power bargaining have may organisations fi opnainpi o o aelvl fee omn aeoiso passenger of categories many to offered levels fare low for paid compensation de In duty. fuel on rebate a as remains extent fuel-ef incentivising costs marginal formula, particular as complex in known affecting more recently now incurred, until costs is percent fuel grant 80 net of The reduce level services. greatly a of to at fuel, was on this payable of duty effect the the of much offset 1970s the in duced rmlclatoiisfrtentcs mil nls eeu)o feigcnesoayfrsto fares concessionary The offering 60). of about revenue) over lost aged received in those (mainly (principally is categories compensation cost passenger addition, net certain In the ticketing. for through off-vehicle authorities whether local or passengers, from vehicle, from revenue the is on Britain transactions in cash income operator of source principal The profitability and income Operator 3.3 Competition then size the depot by by scale enquiry of as economies the size, for but depot evidence by limited vehicles, scale some (for more of found economies only between (2011) some Commission split expect might are One overheads output. service to proportion White Peter 34 not and purposes, assumed. journey be of may that mix extent wide the to a work from by to characterised journey adult is the services by dominated bus local for features demand market The other and purposes trip Major values 3.4.1 elasticity and services, bus for demand The 3.4 hswl pera a as appear will this hsfrspr fa operator an of services, particular part for received forms are payments this contract where Likewise, income. of sources three all fpaigavleo h seso h uies xmndi oedti ntete Competition then the in detail some in (2011). examined industry questions business, the complex the on more of report assets somewhat Commission the raises on This value employed. for a capital measure placing on of quick return a the provides be This may revenue. measure total of percentage profi a comparing as taxation and interest before profi of out paid disrneese ooti o oe oersssc svehicle as such risks some cover (or obtain to easier insurance nd large that however, mind, in borne be should It surprising. seem may groups operating major ve tcnb enta hpigfrstelretsnl lmn fbsjuny 2.%,adas a also and (25.4%), journeys bus of element single largest the forms shopping that seen be can It euno aia netdwl eepce.Weecptlhsbe asdb loan by raised been has capital Where expected. be will invested capital on return A ipemaueo profi of measure simple A ‘ small h ainlTae uvy(eatetfrTasot 05 niaigtecmoiinof composition the indicating 2015) Transport, for (Department Survey Travel National the ’ depots). ts. agn vrtm n ewe prtr.Hwvr oeappropriate more a However, operators. between and time over margins t 1 ‘ cost ntelgto hs h osldto fteidsr otdrglto into post-deregulation industry the of consolidation the this, of light the In ’ u hr qiycptli mlydi ilb ntefr fdividend of form the in be will it employed is capital equity where but , aiiyi h euno ae agn sal de usually margin, sales on return the is tability ’ uiesicm.Patc nohrcutisvre,otnwith often varies, countries other in Practice income. business s ‘ u evcsOeao Grant Operator Services Bus fi 3 iga ning fi in eilsadsatadtces u oalarge a to but tickets, smartcard and vehicles cient ‘ commercial ’ evc,a prtrtu includes thus operator an service, fi ’ eadtetinternally). theft and re BO) n sbsdo a on based is and (BSOG), ‘ uldt rebate duty fuel Table . 2 fi e searnings as ned 3.2 hw data shows fi ’ nance, intro- – Downloaded By: 10.3.98.104 At: 10:42 26 Sep 2021; For: 9781315726786, chapter3, 10.4324/9781315726786.ch3 prtr a eal osbtnilyin substantially to able be may operators hnwudb xetdfo ierrgeso fbsti ae gis a wesi (KPMG, ownership car against rates annum) trip per bus as head of such per regression (trips areas, linear use a 2016, certain from bus with expected higher trend, be having broad would Hove, than the and around Brighton seen and is Oxfordshire, Poole, scatter considerable a that however, osqec fterltvl oa aueo ead n iie oa alternatives modal for Typically, limited low. and relatively are demand, about travel of elasticity of bus short-run for average nature elasticities an price demand local short-run relatively that is the available, of consequence A demand of Elasticities 3.4.2 Hence, ownership. car with correlated will, inversely ownership and car groups rising income lower in more concentrated is younger is group use and adult education working-age in the still in penetration those Market namely retired. groups, are limited. age who oldest those and and adults, youngest the among bus base. that the bus noted as of share used be greater are a should kilometre form It thus passenger and total shopping. purposes, other when internet for travel those in activity than of growth longer shift somewhat the and are by trips centres affected work be urban may purpose traditional trip from a as away shopping on dependence that risk the with evc mrvmnsi utai n e eln Wli,21)idctsmc higher much recent indicates from 2013) Evidence (Wallis, cycle. or Zealand foot New by more and substitution be Australia modal may in of 2km) ease improvements averages (below the trips service these to short around due Very variations sensitive 2010). Nesheim, price of and evidence (Molnar some al., conclusive et always is (Balcombe to purpose There trip correspond 4% operated. with largely a associated are run cause services would kilometres level time bus re service also of in will in they changes although increase frequency, purpose, 10% service in this a changes For bus (i.e. as demand). +0.4 (expressed level in about service of for increase and value year), one a about run) over 4% kilometres about of demand in drop a cause orlto a efudbtencronrhp noelvladbsue yial,bus Typically, use. bus and level income ownership, car between found be may correlation A local by taken demand of share higher relatively the indicates also Survey Travel National The fi ue2) utemr,ee o ie atr ficm n a wesi,bus ownership, car and income of pattern given a for even Furthermore, 22). gure oa rp e esnpryear per person per trips Total purposes All purposes Other Leisure business Personal Shopping Education Commuting purpose Trip 3.2 Table endrvd 2 stettltisb l modes all have by percentages trips above total which the from is numbers, 921 shown whole are derived. table as been the rounded in person data that per Note trips 2014’. with England mode: main and purpose by rates) Source ainlTae uvyEgad 04 al 49 Aeaenme ftis(trip trips of number ‘Average 0409, table 2014, England, Survey Travel National : u oresb ups,2014 purpose, by journeys Bus eei paribus ceteris as euto nbsue tsol ebrei mind, in borne be should It use. bus in reduction a cause , fl ec eadb cint mrv evc quality. service improve to action by demand uence – . a easmd( 0 elfrsrs would rise fares real 10% (a assumed be may 0.4 04 n ekofpa eid,atog not although periods, peak/off-peak and 2004) 90[921] 59.0 [6.4] 99.8 [5.0] 20.3 [7.5] 11.8 [8.6] 25.4 [9.7] 18.6 [7.5] 18.6 trips] modes’ all of share bus market [and trips bus all of Percentage . [2.6] 5.1 fl c hne nntoksz n periods and size network in changes ect u economics Bus 35 Downloaded By: 10.3.98.104 At: 10:42 26 Sep 2021; For: 9781315726786, chapter3, 10.4324/9781315726786.ch3 en efdfaig o xml,i h ogrneatct eeaot-.0 h e nraein the increase given net £1.20. the about to However, -0.80, close to about revenue. come reduced were could be in elasticity increase would long-run an reduction revenue the such lesser if term, example, long a For the = self-defeating. with in 1.10 being elasticities but x price £1.10, higher 96 percent a to much be 10 of percent, producing would evidence by 10 level if cost of revenue service, new increase total in the price reduce reduction but A trips, a £100. 96 is Likewise, to revenue £105.60). reduction if trip, demand example, per (for a revenue £1 cause in at increase would net made a are obtain nonetheless trips yet terms 100 real in fares increase to able trips. non-work of frequency reduce to patterns travel usiuinb travellers by substitution h fet fetra hne n h industry the and changes external of effects The deregulation to prior Developments 3.5 Mulley by chapter the in provided is issues pricing of review ( and wider Batarce evenings A as and 1.1. such periods to for up run of kilometres weekends, vehicle to respect with elasticities service-level White Peter 36 prtr,admd optto ete hog idn o evc otat or contracts service for bidding through (either journeys. extra competition in-vehicle to made slower due and to operators, time due running worsened was increased quality by service offset and extent stops, some at to time dwell was one-person-operation by saving conductors this on-board produce replacing increases. although by necessarily (OPO), was fare kilometre not bus did per and/or cost periods reduce reductions to off-peak service at further levels rata service stimulating increases, in rose, cost reductions real costs (a Furthermore, by labour caused decline were further as impacts fares caused Further real especially balance. in turn revenue:cost increases in a by restored These responded nonetheless operators levels. The which ownership. service to car demand, cutting growing of in and impact reduction the a to was due 1950s effect the initial in levels high from declined demand oal hog h dpinof adoption the through notably dif very aetm samre hf oOOfo h al 90 tu viigsbtnilicessin increases follow 2016). substantial not (White, did avoiding London 1980s (thus areas. the 1970s Executive until Transport early suit Passenger the other the from by at OPO followed policy soon to this time), shift introduced dwell marked which on- Midlands, a of transactions West as cost cash the marginal time in for zero same noteworthy the need most and was the convenience This through avoided trips. travel extra holder additional the stimulated also to and periods vehicle, and zones designated within lal ersie nta h oe-noeaestne ob hs nwihbsoeainwas operation bus which in those be to tended areas lower-income the that in regressive, clearly cl,freapebtenlwcronn osn sae n oeaf more and estates housing car-owning low operator’ between same example the for scale, within elsewhere of losses about encouragement offset deliberate concerns South operations the were in been there notably had and system most expenditure, regulatory above), public of described levels effects high ‘ elasticity incurred the this but (using Yorkshire, negative ownership the offsetting car thus levels, of service increase effects and levels fare reduce to counties, metropolitan leakage’ ute osqec fteeeatcte sta,a es ntesotrn prtr a be may operators run, short the in least at that, is elasticities these of consequence further A Over noainmyas aebe eerdb h euaoysse hc rtce existing protected which system regulatory the by deterred been have also may Innovation oesto Powers otsvns(o esn once ihcs tutr,a oe bv) h laetattempt clearest The above). noted as structure, cost with connected reasons (for savings cost fi ut aigsi hs oeueu noainhdocre uigte16sad1970s, and 1960s the during occurred had innovation useful some this, said Having cult. ogrpro,eatcte edt eo rae antd ic rae cp xssfor exists scope greater since magnitude greater of be to tend elasticities period, longer a curn npyet oinef to payments in occurring Chapter fi ac u evcsealdpbi uhrte,epcal hs ntethen the in those especially authorities, public enabled services bus nance 4). – o xml,bign owr a ucaedcso,o changing or decision, purchase car a forward bringing example, for ‘ Travelcard fi in nubn prtr.Afrhrcneuneo the of consequence further A operators. incumbent cient ’ iktn,i hc ad iigulmtdtravel unlimited giving cards which in ticketing, ’ epnemyb rcdfo h 90,a bus as 1960s, the from traced be may response s ewr hnapido large a on applied when network s r rata pro ‘ cross-subsidy ‘ euto ncss would costs, in reduction iiu circle vicious fl etsbrs hswas This suburbs. uent ’ nwihprofi which in ‘ nteroad the on ’ fet,but effect), table pro ’ ) Downloaded By: 10.3.98.104 At: 10:42 26 Sep 2021; For: 9781315726786, chapter3, 10.4324/9781315726786.ch3 upssadrslatpieeatct)myhv aeetaoaino h xrs oc out- trip coach of express mix the the of (notably extrapolation questionable. made context buses have different local may did to the lesson elasticity) come this Furthermore, price but drawn. resultant valid, been and been have purposes have not may to compete to appear operators not smaller for scope the on views (2012). Robbins and White by in provided is review fuller A the factor. a and also hubs, was been terminals major have at may services factor interconnecting major short-li A often dominant. were o remained these smaller deregulation, of impacts on the market However, lowe rail. stimulating by in market effects and itself l offer to service due bene regions generally low-density as in judged cuts some price were in service there reduction Although overall of improved. an were cases and quality routes service and trunk coverage the network on Frequencies, competition levels. price strong with 1986, by percent through system. strengthened licensing was operator aspects safety-related the of regulation quality However, charged. fares and fet nvhceuiiain n hso ntcss ietoeaigcssprvhcekilometre vehicle per costs operating Direct costs. unit on thus and utilisation, vehicle on effects countries). European virtual stage the mainland to early most contrast critical in in services a continue, such to at able of limited were prohibition rail been with competi- have competing further coaches may express of development (nonetheless fear coach without enable companies express to regional being Concurrently, act larger an tion. the into of 1930 effect operators By main buses. such the local of areas, coach than most consolidation in later the existed somewhat already and develop network buses to bus local began local intensive which Both sector, latter year. the that in Traf of marked Road the Act under Transport regulated been the had under sector 1980 October in system deregulation The coach express of outcome The 3.6.1 Britain in Deregulation 3.6 pro ftemtooia onisfo pi 96 hsrmvdtepwr fsc uhrte to authorities such of powers the removed This 1986. April 1 from counties metropolitan the of Britain in deregulation dif bus One local of components main The 3.6.2 relatives). and friends visiting a as with purposes, (such trip travel of discretionary mix and of due routes) proportion 2001), trunk (White, on high run least short (at competition the modal in of -1.0 degree greater of the order to the is in elasticity sector, Price coach speeds. express average the higher in much higher to generally due buses, local for those than lower typically were n vnn akt ssprt,weesoe h aerueteeotncmrs ifrn legs individuals. different comprise same often the these by route made same chains the trip over of whereas separate, as markets evening and fl h eiint eeuaelclbssrie ne h rnpr c 95myhv been have may 1985 Act Transport the under services bus local deregulate to decision The inc deregulation coach express of outcomes The The major had seasonality above, services bus local for described costs affecting factors to addition In ecdb h ucs ftecahdrglto.Isotoeas ugse htsimplistic that suggested also outcome Its deregulation. coach the of success the by uenced fi al.Hwvr h hf ne eeuainmyhv entkntofr raigdaytime treating far, too taken been have may deregulation under shift the However, table. fi s ao hnei rti aeaottruhtedrglto fteepescoach express the of deregulation the through about came Britain in change major rst fi ‘ deregulation ut naayigteipcso oa u eeuaini h ersmlaeu abolition simultaneous near the is deregulation bus local of impacts the analysing in culty ’ a xesv,rmvn rvoscnrl nrue prtd timetabling operated, routes on controls previous removing extensive, was fi il npriua,lwricm us lower-income particular, In cial. fi rcscmeiinfrteofpa discretionary off-peak the for competition prices r c f13,btisefcsmyhv enmore been have may effects its but 1930, of Act c aktn tegho ag prtr.Acs to Access operators. large of strength marketing eaoswr iie.Wiemn nee the entered many While limited. were perators e.Tepicploeao,Ntoa Express, National operator, principal The ved. ue ag rwhi iesi,o bu 50 about of ridership, in growth large a luded s fcossbiy h vrl fetmybe may effect overall the cross-subsidy, of oss h motneo ewr fet,offering effects, network of importance the r and ohtruhtecoach the through both gained, ers u economics Bus 37 Downloaded By: 10.3.98.104 At: 10:42 26 Sep 2021; For: 9781315726786, chapter3, 10.4324/9781315726786.ch3 ubro evcscudntb rvddo hsbss seilyi o-est ua areas. The rural cases. such low-density in in provided especially be speci basis, to services authority this contracted on local for provided introduced be therefore were not Provisions could services of compensation number fare pro a concessionary (including and costs BSOG) all (now cover rebate would duty now fuel fares, is user re-regulation i.e. commercially, of form avoided a have below). conurbations also further where would (discussed other operators This contracts the London. private quality in through compensating of that proposed potentially to some similar of which control dif issue of in conurbations, system the experiment a larger to genuine subject the a been had been with have even would speci comparisons, many approach to thus direct subject system also make is London London which However, The compared. be example). could for elsewhere system cities, unintentional) (albeit French experimental (in in an market the formed contracts enter to network-wide operators smaller for to easier it contrast making thus contract, separate a formed route eandada and retained oa usdaiso htbd alltrpiaie) n prtr e oteLno market, London the to and costs new control operators to quality incentives and service creating raise privatised), tendering, competitive later through of (all contracts mix service body a gaining to that (LRT) of Transport Regional subsidiaries London monopolist local the from shifted were years. operations recent Bus in Awards Bus UK annual the at awards provided often several have won remaining those However, counties. services metropolitan high-quality former pro including the privatised, lower in been have those practice, accept operators of In municipal all operators. the to of other most willing as time, basis Over often companies. same privatised were the on authorities general services receive owning contracted to for permitted their not bid were to They had such. and as subsidies authority local the from managed separately toeondb oa uhrte,mil nlre ra ra)wr emte ocniu in continue to permitted were areas) urban larger Bus as in operators National but mainly Municipal ownership, (the Scotland). public authorities, within ownership local Group its by Bus owned under Scottish and (those directly Wales operators and those England government in central privatise However, Company to ownership). public initiative in were the in both Rail took when British and place Express took National 1980s between early competition the intensive the case, coach express the whole. in a as licence industry the operator later, on an (and, limit facilities quantity While a maintenance forming run. of than adequacy to the planned on primarily they based service(s) the registering speci then an was and of notice timetable licence, of or route period the A amend or compiled. service be new and a can register service. routes timetables to existing in operators and remained over for has routes days) controls process (42 of registration removed stipulated route inventory a it an coach, effect hence coaches, express limited with to place, express but contrast act, In 1980 of behaviour. the under operator case removed in largely the been had in regulation from Fares followed As timetables. such as 1986. services bus October local of 26 Deregulation Yorkshire. South in notably cuts, service comprehensive of levels high provide White Peter 38 ne h eeuaino 96i a sue htms evcswudb operated be would services most that assumed was it 1986 of deregulation the Under odnwsntsbett eeuainadacmrhniepbi uhrt a retained. was authority public comprehensive a and deregulation to subject not was London lhuhotnascae ihdrglto,piaiainwsntcicdn ihi (indeed, it with coincident not was privatisation deregulation, with associated often Although operator an obtaining by simply market, the enter to operators new for easier became thus It fi dtenme fvhce noeao a loe orna n n ie hswas this time, one any at run to allowed was operator an vehicles of number the ed ‘ rs cost gross – fi – R pcfigtesrielvlt epoie.Acmo aesaewas scale fare common A provided. be to level service the specifying LRT stesries ob rvdd ae yial olwn commercial following typically fares provided, be to service(s) the es o xml,bt edn ue n oha ue Eibrh have (Edinburgh) Buses Lothian and Buses Reading both example, for ’ ‘ arm otatsse dpe,i hc eeu a eandb R.Each LRT. by retained was revenue which in adopted, system contract ’ length s fi ’ fi agnfrteoeao) twsacpe,hwvr hta that however, accepted, was It operator). the for margin t uiess ec ae u fdrc oiia oto,and control, political direct of out taken hence businesses, aca upr,rsligi ag aeicessadsome and increases fare large in resulting support, nancial ‘ control ’ aeaantwihteflyderegulated fully the which against case fi agn hnrqie in required than margins t fi aca eore)rather resources) nancial fi ut preferable A cult. fi features c Downloaded By: 10.3.98.104 At: 10:42 26 Sep 2021; 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income operator 3.3 Tables a ie usatal bt ihnadotieLno)adpbi xedtr a grown and has kilometre expenditure levels public bus of and service per London) cost effect outside in rapidly However, and ridership. the growth within in (both marked with growth substantially risen large London, together has very In a quality, in people. resulted service older factors on other for focus travel greater free and universal sharply. fell network expenditure stable public Total cost more kilometre. in per bus drop per cost similar cost stable a in in approximately that resulting an to retained, trip and were passenger London, loadings per London outside In load made. average trip resulted in passenger run However, drop kilometres region). bus marked deregulated increased a an the in with and combined London which in continued, (both in losses reduction kilometres ridership sharp bus very per a cost and run, unit kilometres real bus in increase an competition, interoperator u oasitfo ra-vnpsto ooeivligvr ihlvl fsupport. of levels high very involving one to position break-even a from shift a to due to 08 inclusive 2008, Source Note Table elcs e a rp 3%+0 +6% –34% +10% –39% –33% –30% trip* pax per cost Real km* bus per cost Real index fare Real run km Bus trips Pax Variable 3.5 – usd odnmil u ocnesoaycmesto n ihnLondon within and compensation concessionary to due mainly London outside o20/ ny ra’a 078prices 2007/8 at ‘real’ only; 2006/7 to * : rvd ulrdtiso rnsi evc upt ae,rdrhpadui costs; unit and ridership fares, output, service in trends of details fuller provide eie rmDprmn o rnpr,Pbi rnpr ttsisBleisto Bulletins Statistics Transport Public Transport, for Department from derived : 3.3a idctr o oa ue nEgad18/ o2007/8, to 1985/6 England in buses local for indicators Main inclusive ‘ eminimus de ’ 5%+4 +30% –16% +94% England +5% of Rest –42% +53% +74% areas Met +89% London eoitdcnrcswe mle usaeinvolved. are sums smaller when contracts negotiated fi lgp ntecmeca ewr,bt nlow- in both network, commercial the in gaps ll – ned eea o aen provision no make now several indeed, +42% fl cuto from uctuation u economics Bus 39 Downloaded By: 10.3.98.104 At: 10:42 26 Sep 2021; For: 9781315726786, chapter3, 10.4324/9781315726786.ch3 a n u u odcos eeuainadtetra fcmeiinhdamre feti forcing in effect marked ridership a lost had to competition of response threat in the and cuts deregulation service conductors, incremental out cut made and had operators 1986, before Whereas • • ee White Peter 40 of reduction a level. absolute suggesting high 2014, fairly a and from 2013 albeit terms, between real and in percent 2011 3 about and 2010 between kilometre bus • factors: several by • explained be may 2014), (White, areas deregulated the and London deregulation. ‘ aeyear base h hr rpi elui ot e u ioer,o bu 5pretb 9920,bt in both 1999/2000, by percent 45 about of kilometre, bus per costs unit real in drop sharp The hne nwrigcniin n a,wt akdrgoa variations. regional marked with pay, and conditions working day; in working minibuses; changes the notably during vehicles, utilisation smaller vehicle of and use driver better producing and ratios nrae rdciiyo rvr,prl through partly drivers, functions; of administrative productivity and engineering increased in especially reductions, staff large Source Note London Region 2009/10 in composition percentage income Gross 3.4 Table e ra 56 areas Met eto nln 52 England of Rest nldslclatoiyascae expenditure associated authority local includes * : ’ eatetfrTasot 05 al BUS0501a table 2015, Transport, for Department : ..pirt h fet fbt erpltncounties metropolitan both of effects the to prior i.e. , oa u uiesicm nEngland in income business bus Local Source Variable 3.3b Table elcs e u mna+6 +19% +16% n/a km bus per cost Real run km Bus trips Pax Source Note 592 support net Local compensation Concessionary BSOG 3.5 Table ma 041 prices 2014–15 at £m : eatetfrTasot 05 alsBS23 n BUS0406 and BUS0203b tables 2015, Transport, for Department : eatetfrTasot 05 al U 0502b BUS table 2015, Transport, for Department : asne eeu rs upr*Cnesoaycm BSOG comp Concessionary support* Gross 47 revenue Passenger 045t 041,inclusive 2014/15, trends to England 2004/5 in buses local for indicators Main rnsi u nnilspoti England in support financial bus in Trends 3 9 –1% +9% –9% –7% England of Rest +3% +31% areas Met London 34 10 20 323 2013/14 391 1999/2000 ‘ fl teigout attening 12 23 20 ’ 4 blto n nrdcinof introduction and abolition oeta 956i ae as taken is 1985/6 that Note 885 1049 303 ’ fpa:f-ekservice peak:off-peak of 6 10 9 Downloaded By: 10.3.98.104 At: 10:42 26 Sep 2021; 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As structures working. administrative of and pattern workshops whole the on rethink a Fu approximately coach an express produced in the which reduction in elasticity service, aggregate higher an the with produce the (compared would growth is ridership fares despite factor revenue lower competitionindustry probable that Where A meaning behaviour. elasticity, fares. (van oligopolistic price such lower classic short-run as low levels to in approximating fare on than hence rather 2002), passed frequency, service Veer, been on der largely have based might be to costs appeared it in developed, reduction the and deregulation of to prior break-even some aggregate to close produce fairly not been did had operations it competition where output, even Whereas reductions, service fare elsewhere. total increasing also counties, and costs, and met down sector, of The bringing abolition that in sectors. succeeded the in all to continued increases due in partly real substantially nonetheless was rose areas but metropolitan levels the fare in increase improved, large especially levels service aggregate while shows, 1985/6. in those below substantially remain kilometre bus per costs unit real increases, these Despite • temr,gvntedstlt fwiigtm,psegr edt or the board to tend passengers time, waiting of disutility the given rthermore, neligteecagswr eaiefcosafcigbsrdrhp oal iigcar rising notably ridership, bus affecting factors negative were changes these Underlying h usata nrae ncsssne20 a eatiue to: attributed be may 2000 since costs in increases substantial The ntrso iesi n asne bene passenger and ridership of terms In osnd ipyt anantesm rqec a lutae ale) n loensure congestion also as traf and the schedules earlier), deregulation of running illustrated phases (as into earlier the frequency drivers in same Whereas and the reliability. adequate vehicles maintain to additional simply insert worsened, and marked to London elsewhere. Very as than need 2013. conditions (such and better costs A substantially living 2000 offer high between suf to displaying a earnings needing areas recruit indicates Oxford) real some 26) to weekly with page exist, (2016, driver order differences study bus regional in KPMG in recent conditions, rise The 2008. percent working in 21 recession and the wages to up improve especially to need A h xeswiigtm niao) hshsbe atclryntwrh ntels three last the in noteworthy particularly (2016, been (using study contracts has KPMG into This The built indicator). are years. incentives where time explicit penalties waiting case, applying London excess the and the In registered, done. running been timetable not on the has placed with this been accordance has in emphasis increased services matters, reliable safety with concerned largely were nrae nsm te ot,sc sinsurance. as such costs, other some improvement deregulation. the in to of Increases contrast phase in earlier 2013/14, the and during 2004/5 between shown staff of member per miles bus il oee,poe ae n okn odtosrpeetdals owresi the in workers to loss a represented conditions working and wages poorer However, cial. fi ue9 niae ral tbepoutvt ntrsof terms in productivity stable broadly a indicates 9) gure fi stable Tbe3.3 Table As emerges. picture mixed more much a ts, elttlrvneweefr hne occurred). changes fare where revenue total real fi fi commissioners c s u oarrive to bus rst u economics Bus fi in staff, cient 41 Downloaded By: 10.3.98.104 At: 10:42 26 Sep 2021; For: 9781315726786, chapter3, 10.4324/9781315726786.ch3 hs fdrglto.TeCmeiinCmiso on htol .%o evcsexperi- services length of whole 2.5% their only over competition that head-to-head found effective Commission enced Competition The deregulation. of phase rpeetn bu 0 ftecss a e srbenefi user net a was cases) the of 30% about (representing ( Counties Metropolitan former author the the and by London approach benefi outwith areas early net in An a negative assessed. that are indicated outcomes 1990) the (White which against proposed being case eetaayi yPetnadAmtii(04 niae iia ucm dpneton (dependent outcome individual similar of level a identify the at indicates to data disaggregate (2014) operators uses (2014) counties Almutairi Cowie met and employed). frameworks following Preston modelling increases by fare analysis large recent of effects the separately bene fi a mets, the assisted also have activity economic of from level head high per a use. ownership and bus car growth stable Population broadly elsewhere. 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Britain local very in a available at demand data of management (but nature correct aggregate to emerge in necessarily be not may attitudes does competition o danger on-the-road a which creates turn services, in This term. long the in route 1 Notes case, British insuf the appears market in patchy, the been as has cases competition attempted, direct most of in been extent The and has observed. been has deregulation groups large complete into consolidation fairly where li However, indicates operation scale. bus local of structure cost The Conclusions 3.11 White Peter 46 Quali A Deregulation: Bus June. UK London, Economics. (1996). Journeys, Transport B. Greener of Passengers. Colson, Fallacies Bus (1949). on E. Congestion G. of Buckpitt, Impact The (2016). D. Begg, P. White, and M. Wardman, H., Titheridge, J., Shires, J., Preston, N., Paulley, R., Mackett, R., Balcombe, Long on Markets Bus Intercity of Analysis (2014). C. Ayala, and M. J. M. 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Molnar, uhcerreiec xssfrteptnilt mrv ef improve to potential the for exists evidence clearer Much oit tLarge. at Society 20) h eadfrPbi rnpr:APatclGie rnpr eerhLbrtr report Laboratory Research Transport Guide. Practical A Transport: Public TRL593. for Germany. Demand and The U.S. (2004). the of Example The Market: Young a Economics and Transportation Established an in Distances eso 2012 Session September. Transport, eerhi rnprainEconomics Transportation in Research oa u evcsi h K(xldn otenIeadadLno) odn 0December. 20 London, London). and Ireland Northern (Excluding UK the in Services Bus Local oebr p 4 pp. November, rti EcuigLno)UigteNtoa rvlSre.December. Survey. Travel National the Using London) (Excluding Britain optto omsinrpr,21,pr 11.11(b). para 2011, report, Commission Competition RPI. by Commission Author the of 10 part See eiwo de of review A vehicles. 38 to correspond would adn ee hn38mlinpsegr e annum per passengers million 3.8 than fewer handing e aarp .8 fteCmeiinCommission Competition the of 9.181 paragraph See acltosaefo aai rnpr o odn 05 p 1ad13 dutdt elterms real to adjusted 103, and 81 pp. 2015, London, for Transport in data from are calculations ’s – 3 C0 September. HC10, 13, fi fl iin scretybigcnutdb h nentoa no fPbi Transport. Public of Union International the by conducted being currently is nitions rnpr Reviews Transport – ecdb vdnefo te ra) It areas). other from evidence by uenced 7. 0July. 20 Bill, Services Bus 58, Bill HL 8 eebr p 245– pp. December, 48, , eot(2011). report ’s fi n osmrSvrinyi h nls eeuae u Market. Bus Deregulated English the in Sovereignty Consumer and t 8 p 255– pp. 48, , 6 p 301– pp. 16, , fi in ospotmr hnoeoeao naspeci a on operator one than more support to cient 62. 11. fi 54. dSceswt uhSilt fe utmr and Customers Offer to Still Much with Success ed isteeaiaino optto fet on effects competition of examination the bits teptnilfrdrc prtoa cnme of economies operational direct for potential ttle xliainb nraigfrsado cutting and/or fares increasing by exploitation f – eot(01.A (2011). report ’s t1000psegr e eil e nu,this annum, per vehicle per passengers 100,000 at rnpr World Transport utb mhssd oee,ta the that however, emphasised, be must – 4 odn eatetfrTransport. for Department London: 14. fi inyadrdc ot ihna within costs reduce and ciency uut .94. p. August, 1 , ‘small’ Eurotransport eo a de was depot ,p.13 pp. 2, , fi eerhin Research e sone as ned – 15. fi c Downloaded By: 10.3.98.104 At: 10:42 26 Sep 2021; For: 9781315726786, chapter3, 10.4324/9781315726786.ch3 a e er .P 20) nr eerneadQaiyPoiini h oa u Market. Bus Local the in Provision Quality and Deterrence Entry (2002). P. 8. author. J. no. the Veer, report to London, der available in made Van Travel Survey, (2015). Passenger London Bus for Annual Transport from Data (2016). Focus Transport Local Bus-Based of in Case Change Regulatory The Recent Structures? Policy: Converging Transport (2014). A. of Wreststrand, Impacts and T. Term Rye, Long the Evaluating (2014). T. Almutairi, and J. Preston, ht,P 19) htCnlsosCnB rw bu u eeuaini Britain? in Deregulation Bus about Drawn Be Can Conclusions What Sheet. (1997). Balance P. White, Welfare A Wallis Deregulation: Ian Bus by (1990). Report P. Services. White, Bus Off-Peak of Development the with Experience (2013). P. I. 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New report as published September, Zealand, New Wellington, Associates, nTasotto Economics Transportation in Economics Transportation in Research 77 pp. Paris, title), same the (of 114 Table 23,July 22(3), , – 32. – 16. ulcTasot t lnig aaeetadOperation and Management Planning, Its Transport: Public – etme,p.247 pp. September, 9 p 379 pp. 29, , 6 30 36, , eerhi rnprainEconomics Transportation in Research – 8 p 277 pp. 48, , 8. – 86. – 65. eerhi rnprainEconomics Transportation in Research – 109. – 85. ora fTasotEooisadPolicy and Economics Transport of Journal 8 eebr p 263 pp. December, 48, , odn Routledge. London: . 8 eebr p 24 pp. December, 48, , rnpr Reviews Transport u economics Bus – 9. eerhin Research Transport Research – 32. 47 , ,