Select Committee on Environment, Transport and Regional Affairs Appendices to the Minutes of Evidence

Supplementary Memorandum by Stagecoach Holdings Plc (IT 159A)


  Thank you for your letter. I shall respond to each of your points in turn with respect to our rail services:


  Our rail passenger volumes are significantly dependent on the economy. In the case of South West Trains, our peak volume tends to follow Central London Employment trends. Our off-peak markets are also affected by rates of consumer spending and GDP.

  Over the next five years, we expect passenger volumes on South West Trains to grow by around 6 per cent (up to 3 per cent growth per annum) which includes peak volume growth of around 4.5 per cent. This includes the effect of the opening of the Jubilee Line Extension which will improve access from Waterloo to locations in Westminster and Docklands.

  This estimate is based on modelling of the different factors which impact on passenger volume at South West Trains, using external consultants' assessments of economic factors where applicable.

  We expect that around 45 per cent of this growth will come from inter-urban markets with the reminder from intra-urban. Similarly, around 60 per cent of this growth are likely to be new rail users (or lapsed, with travel dependent on the economic cycle). Around 40 per cent of the growth will be additional journey by existing users, primarily leisure and business journeys rather than commuting.

  With regard to meeting the demand, we currently have proposals awaiting approval by the Rail Regulator to increase our main line off-peak services. This will increase the number of off-peak trains per hour from Southampton to London and Portsmouth to London from 3 to 4. We hope to start these additional services from the May 1999 timetable change, however, this is subject to the Rail Regulator and OPRAF approving our plans.

  With respect to our peak markets, we are significantly constrained by the infrastructure at Waterloo station. We believe that the station is probably operating at capacity, both in terms of the number of trains at peak times and the length of those trains (only a certain number of platforms can accommodate 12 coach trains). We have asked Railtrack to undertake two separate feasibility studies into increasing the capacity of our suburban network and increasing the capacity of Waterloo station itself and we hope that they will be able to provide us with a report of their findings early in the New Year. In the meantime we are investing £90 million in 30 new 4-car trains which will have high-density seating and be able to carry a greater proportion of standing passengers. I anticipate that these trains will enable us to meet a signficant part of the extra peak demand when they are introduced into service (by Summer 2000 subject to testing).

  The specific obstacles to meeting increases in demand include:

    —  Capacity of track and platforms, particularly at Waterloo and within the Greater London area.

    —  Our "Mark 1" rolling stock is of low capacity compared to modern stock.

    —  There is limited land available around our stations to expand our car parks to encourage park and ride. Many of our existing car parks are at or near capacity and car park expansion is an important strategic issue for train companies wishing to grow off-peak travel—an issue which is frequently overlooked.

  We hope that we will be able to secure an extension to the South West Trains franchise which will allow us to invest to address some of these capacity issues.


  At present, car hire is available from Guildford station (provided by Hertz between 0830 and 1800 Mondays to Fridays). We have not commissioned any market research into the size of the potential car hire market. Clearly we are not experts in the car hire market and our role can only be to assist companies willing to provide such facilities at our stations and to raise awareness of these services to our passengers.


  Future bus patronage is very dependent on Government transport policies, the effect of congestion, car ownership, and the level of support for bus services by local authorities together with the progress they make in implementing bus priority schemes.

  In recent years Stagecoach has been able to "buck the trend" of static or declining bus passenger volumes by its policy of investment in new vehicles, and development of new services such as our "Stagecoach Express" inter-urban network and new pricing initiatives such as our "Megarider" network tickets which are priced to make public transport affordable. These and other initiatives enabled us to achieve patronage growth of 1.6 per cent in 1997-98 and we hope to build upon these successes in the future, with a further boost from the implementation of Government policies.

  Increases in demand for bus services can easily be met by investing in additional new buses, or slowing the rate of withdrawal of older buses. Stagecoach companies are already running substantial extra numbers of buses over those operated at the time they were acquired by the Stagecoach Group.

  The main obstacle to meeting increases in demand is growing traffic congestion, which can make it uneconomical to provide extra buses. For example, if a service runs every 10 minutes and the journey time from end to end is 28 minutes each way, 6 buses ae needed to operate the service. If the journey time increases by 30 per cent due to congestion, 2 more buses will be needed without any extra revenue being obtained. If passenger volume grows, more buses will be needed anyway and the effect of increasing congestion will be even greater.

Brian Cox

Executive Director

29 December 1998

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