How much it costs train companies to carry passengers

[whole diary]

[grahame]

Mail. online, today. "Regulator reveals how much it costs train companies to carry their passengers". Amongst the results from the ORR^» (Office of Rail and Road formerly Office of Rail Regulation - about):
First Great Western ... 8.79p / passenger kilometre = 14p / passenger mile.
Northern ... 19.10p / passenger kilometre = 30.5p / passenger mile.

http://www.dailymail.co.uk/news/article-2237772/How-costs-train-companies-carry-passengers-results-surprise-you.html

How do fares work out?  Not in the article - my semi-random selection of some routes I know and have used

London to Chippenham, peak, standard class single - 73.00 for 100 miles = 73p / passenger mile
Melksham to Farnborough Main (*), morning train - 55.00 for 71 miles = 77.5p / passenger mile
Weymouth to Bath, anytime single via Yeovil - 15.60 for 72 miles = 22p / passenger mile
Carlisle to Leeds, anytime day single - 25.90 for 117 miles = 22p / passenger mile
Manchester to Blackpool, anytime First Class single - 20.40 for 51 miles = 40p / passenger mile

* - my journey this coming week. Ouch!  Have to look for a split, or drive!

[LiskeardRich]

http://www.thisismoney.co.uk/money/cars/article-1633412/Calculator-True-cost-running-car.html

This site has a calculator to show you the true cost of driving. Takes into account purchase price vs resale price etc.

My van costs me 28p a mile. Try taking the loads I carry on a train though!
Wife's car amusingly costs 33p a mile. Amusing as its one of these eco diesels and does 25 mpg greater than mine, but it will according to used car prices devalue quicker than my van and as the cost calculator takes these into account my van wins.

[eightf48544]

Sorry to say I don't believe either FGWs^▸ (First Great Western) figure or Northern's figure i think it's zombie accounting.

It seems very odd that it FGW can do it as cheaply as 14p per mile while Northern costs twice as much. With the breakup through privatisation it is almost immpossible to work out how much money it costs to run a train. Do you only count fare money what about subsidy do you cost Network rail on track access charges or government input or both. There are more than 5 variables therefore the equation is unsolvable.

Accountants have never been able to properly cost a network to reflect the whole rather indivdual lines. That was my whole argument about Beching was that he looked at indivual services (often unchanged since 1922) rather than the network so that towns like Mansfield, Brecon which were served by several loss making services were cut off from the network. Mansfiled in particular having to be reconnected (Robin Hood line) at great cost.

[LiskeardRich]

With the breakup through privatisation it is almost immpossible to work out how much money it costs to run a train.

Afraid to say this sentence is utter rubbish. It is a very simple calculation to work out cost per mile over a fixed period. Average cost per mile over a year is as simple as:

Total annual expenditure/total annual passenger miles = cost per passenger mile

Total annual expenditure will be all the companys costs for the year, and total annual passenger miles calculated from ticket sales. Ticketless travel doesnt get included in the figure.

[ellendune]

It seems very odd that it FGW^▸ (First Great Western) can do it as cheaply as 14p per mile while Northern costs twice as much. With the breakup through privatisation it is almost immpossible to work out how much money it costs to run a train. Do you only count fare money what about subsidy do you cost Network rail on track access charges or government input or both. There are more than 5 variables therefore the equation is unsolvable.

Its quite simple really.  If you run lost of empty trains on lightly used routes you have less passengers to offset your costs. 

[paul7575]

I've just glanced through the whole report.  Most of it goes over my head, but I get the distinct impression the headlined figures are not the TOC^▸ (Train Operating Company)'s only costs at all - and don't really provide the evidence the Mail is implying.

http://www.rail-reg.gov.uk/upload/pdf/toc-benchmarking-report-2012.pdf

Paul

[brompton rail]

It seems very odd that it FGW^▸ (First Great Western) can do it as cheaply as 14p per mile while Northern costs twice as much. With the breakup through privatisation it is almost immpossible to work out how much money it costs to run a train. Do you only count fare money what about subsidy do you cost Network rail on track access charges or government input or both. There are more than 5 variables therefore the equation is unsolvable.

Its quite simple really.  If you run lost of empty trains on lightly used routes you have less passengers to offset your costs. 

 

But Northern DON'T! Most of their trains are well loaded during the day and heavily overcrowded in the peaks.

However, if you take the subsidy paid by DfT^» (Department for Transport - about) to Northern and divide it by the number of passenger miles(or even km!) you get a very misleading figure. FGW run a big proportion of their services as InterCity services which were supposed to pay a premium back to DfT. Northern was let as a loss making franchise which was supposed to decline. It would be interesting to see if the subsidy to Northern has declined in real terms despite now running many more trains (all old and highly varied!).

[eightf48544]

With the breakup through privatisation it is almost immpossible to work out how much money it costs to run a train.

Afraid to say this sentence is utter rubbish. It is a very simple calculation to work out cost per mile over a fixed period. Average cost per mile over a year is as simple as:

Total annual expenditure/total annual passenger miles = cost per passenger mile

Total annual expenditure will be all the companys costs for the year, and total annual passenger miles calculated from ticket sales. Ticketless travel doesnt get included in the figure.

But your calcualtion only gives the avaerage cost per mile of running a train in the UK^▸ (United Kingdom) (exclufiidng NI) as a large sum of money goes direct to Networkrail.  If you don't include Networkrail figures then you have to assumme that their track access charges to TOCS exaclly reflect the cost of running a train over that bit of track which may be shared by a number of TOCs^▸ (Train Operating Company).

Presummably FGW^▸ (First Great Western) pays only a proportion of Bristol Penzance track costs as it shares with Virgin and some freight on parts whereas Northern pays the whole charge for the Whitby branch for which they get a subsidy, so is a subsidy a cost? It counts as income in the TOCs books!

Then of course there are the stock leasing costs which vary from stock to stock so again you can only do an overall average as the cost per TOC is dependant on the stock run, which is determined by the DfT^» (Department for Transport - about).

What about the cost of the myrad staff that work on delay minutes and allocate delay costs to the responsible TOC, Netwokrail or Act of God in some cases. Is that part of the cost of running a train? For a TOC some delay minutes are stock dependant so if you run a fleet of new EMUS you won't get many delay minutes allocated due to the stock if you run 14Xs as Northern does you can expect quite a lot of delay minutes.

Paul7755 has put it quite succintly

"I've just glanced through the whole report.  Most of it goes over my head, but I get the distinct impression the headlined figures are not the TOC's only costs at all - and don't really provide the evidence the Mail is implying."