Virgin Trains – still standing?

25 April 2019

Competition is generally good for consumers, forcing standards to rise and prices to fall. In rail, there is some competition – one example being open access operators, who run services alongside the franchised operator. Hull Trains and Grand Central, both open access operators on the East Coast Main Line, fare well in the National Rail Passenger Survey (NRPS), with 91 per cent and 94 per cent overall satisfaction respectively. Overall satisfaction is also relatively high on the competition, with London North Eastern Railway achieving scores of 87 per cent. Passengers are aware that competition on long-distance routes brings benefits. In our submission to the Williams review about the structure of the rail industry, passengers stated that competition may well help bring down prices and improve customer experience.

However, Virgin’s announcement yesterday takes on-track competition a step further. It sees the future of long-distance rail as similar to air travel. Its proposals are two-fold. They would see firms bidding to run particular ‘slots’ in the timetable, increasing on-track competition, and they would eliminate standing, by limiting passengers to a particular train with a reserved seat, with only one price on offer.

These proposals would be a big cultural change and could cause confusion for passengers familiar with a ‘turn-up-and-go’ railway. Trains between Manchester and London run every twenty minutes, with almost a bus-like frequency, so is the answer really to restrict passengers to an airline booking system? Frequency of trains is a powerful driver of demand, and there is a risk that passengers would book a ticket, not realising that they had to wait for a particular train. Surely the answer is a better form of turn-up-and-go? And surely, passengers should have the choice if they wish to stand?

There is a continuous need to improve capacity on these long distance routes – this is a clear passenger priority, second only to value for money. However, it is not clear if restricting passengers to particular seats and removing standing is wanted by passengers. Additionally, while head-to-head competition could result in passenger benefits, there are wider factors to consider. It is not entirely clear how this model would balance the needs of local passengers who currently use long distance services, nor ensure the continued running of socially necessary but non-commercial services. There are practical issues about on-track competition to consider, including how timetables are changed, services co-ordinated, disruption managed or engineering work planned. In the wake of the May 2018 timetable crisis, having completely decentralised, deregulated services could create more confusion, not less. The same could be said about fares. Fares reform is necessary, but removing all price regulation is potentially risky for consumers, especially as there is little information about how this will work in reality for passengers.

Rightly or wrongly, passengers have different expectations of airlines to rail travel. While the Williams Review is creating the space to experiment with how the railway is run, as with fares reform trials, the effects of changing the current system need to be modelled and tested before we plunge in with full-scale change. Virgin’s current high NRPS scores (90 per cent overall satisfaction) show that it has been doing some things right, even if capacity is still a live issue across the sector. It is unclear that restricting passengers to a particular train will really provide a panacea for passenger satisfaction.

For the time being, the best place to focus attention is ensuring that trains are punctual and reliable, and that operators are accountable.

First published in Transport Times.

Like the blog? Please share on your social channels.