First class -where's the profit?

[HowardGWR]

Ever since I was a young lad (age 13 in 1958) I have been watching trains going out of stations with empty first class sections (except the business trains, e.g. Bristolian) and my own travels are typified by standing on a platform with an empty coach drawn up and then having to walk down the train to find a second class seat.

Are there any data on how much fresh air in first class is carried around the country? Also, are there any data on the profitability of this service? I appreciate that first class pay 50% extra in this country, but two people in a compartment seating (say) 18 first class pax only add up to three in second class.

 

[route:oxford]

50% - If only...

Oxford to Manchester Any time return:-

£343.00 - First Class
£153.00 - Common Class

That's 125% more...

 

[yorkie]

I appreciate that first class pay 50% extra in this country,

Only in a small number of relevant examples.

For walk-up travel, on trains with significant First Class accommodation (ie, the 'InterCity' services to/from London) typically have much greater markups than that, though the gap does tend to reduce at peak times.

Examples on 'Any Permitted' tickets

Bristol - London

Anytime 1st Return £307
Off Peak 1st Return £187

Anytime Return £187
Off Peak Return £67
Super Off Peak Return £53.50 (Regulated fare)

York - London

Anytime 1st Return £365

Anytime Return £249
Off Peak Return £154 (Valid any train evening peak)
Super Off Peak Return £98 (Regulated fare)

Birmingham - London

Anytime 1st Return £254

Anytime Return £158
Off Peak Return £49 (Regulated fare)
​

As you can see, the regulated walk-up standard fares (which are the most popular sold) are between a fifth and a third of the 1st class fare.

However I do agree that, at certain times, there is vast over provision of 1st class accommodation on certain routes.

 

[Mojo]

If a train has 100 Standard class seats of which 70 are occupied (70%), and 10 First class seats of which 3 are occupied (30%), and the train is reconfigured to have 108 Standard class seats and 6 First class seats then there will still be 70 Standard class ticketholders and 3 First class ticketholders on the train.

 

[Simon11]

I would bet that if you had 2 carriages each filled with an average load for standard and first, minus costs of first class, the profit from standard class would be more.

However losing first class may result in customers not wishing to travel by rail therefore there is lost revenue.

However, new TOC's may have it in their franchise agreements to operate first class services. Also, with short franchises, there will be little reward for TOC's to invest in changing the fleet.

 

[bunnahabhain]

I would bet that if you had 2 carriages each filled with an average load for standard and first, minus costs of first class, the profit from standard class would be more.

No, because it costs no more to convey a first class passenger. The additional costs will be a customer host, and any free food/water provided. There may also be additional profit streams to be made from first class passengers with meals provided to them. The profit per first class passenger on some routes is worth that of multiple standard class passengers.

 

[Simon11]

No, because it costs no more to convey a first class passenger. The additional costs will be a customer host, and any free food/water provided. There may also be additional profit streams to be made from first class passengers with meals provided to them. The profit per first class passenger on some routes is worth that of multiple standard class passengers.

Hmm, you state that there is no costs of first class but then mention additional costs? I'm talking about the true cost of offering a first class service to a passenger.

A peak first class carriage to london on virgin, will be worth more than a standard class carriage, however we are talking about the average based over a full week. There will be large periods when first class will be lightly loaded or filled with low yielding first class passengers, with some only paying a few quid more than a standard class passenger.

 

[dvboy]

If a train has 100 Standard class seats of which 70 are occupied (70%), and 10 First class seats of which 3 are occupied (30%), and the train is reconfigured to have 108 Standard class seats and 6 First class seats then there will still be 70 Standard class ticketholders and 3 First class ticketholders on the train.

Such small numbers wouldn't make much difference, but I bet if you turned 2 First Class coaches of your average 11-car Pendolino to Standard Class they'd soon fill up on some routes.

 

[Mojo]

I don't think that purely converting First class accommodation to Standard class accommodation results in an increase in use on its own.

 

[Eagle]

On its own, no, it would only increase patronage on services where first is full to crush capacity (i.e. you'd pick up some of the people you left behind).

However there could be some effect, because if there are more standard seats there will presumably be more standard Advance tickets at each tier, so more people might be encouraged to travel due to the greater availability of lower fars. But you really can't tell how much it might affect that.

 

[Goatboy]

It is a shame that it's often so much more expensive - I'm not sure how it can be considered worthy value for very many hence the very light loadings.

I'll often travel First when the price differential is 50% extra or less - for this additional outlay I feel it's worth the money. But even on something like an FGW HST where the seats are lovely leather and the space is excellent it isn't worth 2 or 3 times the standard class fare. It just isn't that much better.

 

[Paule23]

It's very difficult to know where the profit on a train is made without details on what people pay for their tickets. My thoughts are a lot of people in Std class are using advance fairs, whilst a higher proportion of people in 1st class will be paying the expensive open fare, as their business will be paying and they value the flexibility. Thus the profit per 1st class passenger could be vastly greater than a standard class passenger, hence the company being willing to run fairly empty 1st class carriages (as they still make more profit than a standard class).

I must stress I have absolutely no objective evidence to back this up, just anecdotal views from my use of the railways over the past 20 years.

 

[Harlesden]

How about two levels of First Class to increase use of First Class accommodation?
Basic level of First Class (no freebies or personal service other than water)
Premium level of First Class (all the frills)
Identifying who was who would be by notation on the passenger's ticket
FC = Basic level of First Class (accommodation + water)
FCP = First Class with all the frills and freebies.

 

[MP33]

I travel on a Greater Anglia 1st class season ticket.

On a class 321 there are 16 seats in each compartment per 4 car set. Outside of disruption the most seats that have been occupied that I have seen is 10. One morning I had the whole compartment to myself.

Apart from the use of the 1st class lounge at Liverpool Street, you get nothing else apart from more leg room and a wider seat.

Before our resident Greater Anglia basher starts. Yes they do carry out regular ticket inspections.

 

[causton]

How about two levels of First Class to increase use of First Class accommodation?
Basic level of First Class (no freebies or personal service other than water)
Premium level of First Class (all the frills)
Identifying who was who would be by notation on the passenger's ticket
FC = Basic level of First Class (accommodation + water)
FCP = First Class with all the frills and freebies.

But no First Class food/drink is guaranteed anyway! and would that mean that the person would have to show their ticket all the time whenever the trolley came past or would you segregate them further? Sounds like either a lot of hassle or an easy way to pay less and still end up getting the freebies!
--- old post above --- --- new post below ---

I travel on a Greater Anglia 1st class season ticket.

On a class 321 there are 16 seats in each compartment per 4 car set. Outside of disruption the most seats that have been occupied that I have seen is 10. One morning I had the whole compartment to myself.

Apart from the use of the 1st class lounge at Liverpool Street, you get nothing else apart from more leg room and a wider seat.

Before our resident Greater Anglia basher starts. Yes they do carry out regular ticket inspections.

Is this in the normal peak flow in/out of London? I think there are around 10 or so at each end of a class 365 and whenever I see one into London I usually see it about half full - bearing in mind this would be the London end as well though! It must make enough money for them though... wouldn't it?

(I know FCC did remove one of the compartments from the 377s though!)

 

[HST Power]

I think there are around 10 or so at each end of a class 365 and whenever I see one into London I usually see it about half full - bearing in mind this would be the London end as well though! It must make enough money for them though... wouldn't it?

There are twelve at each end. To be honest, as a First Class customer, I don't know why I bother - you get absolutely nothing on FCC, other than a better chance of getting a seat and a bigger table.

If I'm coming home from London I'll use East Coast to Stevenage, that way I can use the First Class lounge, and there's a chance I'll get something (even if its just a cup of tea and a pack of biscuits) as opposed to squat nothing.

But I don't know if season First holders can use East Coast facilities - or if this would require yet more money.

Ultimately, being a commuter franchise, I can't really expect FCC to endeavour to provide anything more. I don't travel to London all that often (once or twice a month max). If I were a season ticket holder I wouldn't bother. The First Class compartments are normally quieter on Cambridge services, but you'll be pushing it on Ely/King's Lynn services.

 

[HowardGWR]

Only in a small number of relevant examples.

For walk-up travel, on trains with significant First Class accommodation (ie, the 'InterCity' services to/from London) typically have much greater markups than that, though the gap does tend to reduce at peak times.

Examples on 'Any Permitted' tickets

Bristol - London

Anytime 1st Return £307
Off Peak 1st Return £187

Anytime Return £187
Off Peak Return £67
Super Off Peak Return £53.50 (Regulated fare)

York - London

Anytime 1st Return £365

Anytime Return £249
Off Peak Return £154 (Valid any train evening peak)
Super Off Peak Return £98 (Regulated fare)

Birmingham - London

Anytime 1st Return £254

Anytime Return £158
Off Peak Return £49 (Regulated fare)
​

As you can see, the regulated walk-up standard fares (which are the most popular sold) are between a fifth and a third of the 1st class fare.

However I do agree that, at certain times, there is vast over provision of 1st class accommodation on certain routes.

Thanks for the replies everyone. I can see that I live in a second class cocoon. I must admit I never look at the 1st fare quotes as they seem only to apply to the 'if you have to ask the price you can't afford it' brigade.

The Bristol - London example was interesting. I suppose if you knew you would travel off peak anyway, as a leisure customer, then the 1st off peak being the same as standard anytime could be considered.

Perhaps that's the way forward. On inter-city trips (it was those I had in mind) it could be a good policy, similar to 'weekend upgrade' offers. The thing is, once you've built the coaches and installed the seating, that's the end of flexibility isn't it?

 

[kieron]

If a train has 100 Standard class seats of which 70 are occupied (70%), and 10 First class seats of which 3 are occupied (30%), and the train is reconfigured to have 108 Standard class seats and 6 First class seats then there will still be 70 Standard class ticketholders and 3 First class ticketholders on the train.

I hope they wait for the passengers to leave the train before they reconfigure it.

Most people have some degree of choice over where they travel and how they travel. If you expect a train to be unpleasantly full, you're likely to look more favourably at using a 'bus or car for at least part of the journey, and also at arranging your affairs so that you don't have to use that train.

If the train is full, and you decide not to use it, because one carriage is devoted to carrying around a small number of people with first class tickets, there would be a real benefit to the railways for this journey from reconfiguring it.

The snag is that you can't reconfigure trains like that during the day, and the first class carriage may actually be full of people on walk-up tickets at some times of the day on some of the routes it is used on.

The TOC will have data to show whether the first class carriage comes any closer to paying its way than the standard ones do, but it's not something those of us who simply pay their bills will ever see.

 

[Metrailway]

I read many moons ago that First Class passengers provided BR with around 15% of ticket sales in the 1990s. I suspect that figure is a lot less nowadays as many businesses no longer allow employees to claim back first class travel expenses.

 

[Train Pilchard]

There should be no class on the trains, everyone should get the same service, all people using trains are equal.

 

[LNW-GW Joint]

Airlines make their money out of Business Class, partly by squeezing the Economy offering to make people upgrade.
Even buying a car, the marketing pushes you to buy the upmarket aspirational model, where the most margin is, rather than the top or bottom models.
If anything the railways are lagging behind with this type of marketing.
"Standard Class Only" isn't much of a come on, is it?
Eurostar comes closest to the airline model.
Where I think our railways miss a trick on First Class is where they generally do not offer discounted fares.
An empty first class seat is useless.

 

[HST Power]

There should be no class on the trains, everyone should get the same service, all people using trains are equal.

I think you're looking at the bigger picture in that respect.

 

[jbb]

A 1st class ticket costing 50% more does not increase profit by 50% it increases it a lot more.

For example say a standard class ticket is £50 and a first class is £75.
Now imaging that the costs of a standard class ticket are maintaining the train,providing station facilites, fuel, maintaining the track, paying management staff, paying the cost of the train, checking tickets, providing security, all of those cost the same for first and second class,say £45 allowing them a 10% margin so they make a profit of £5 per customer.

Now 1st class has a few extra costs. "free" food, say £5 average, extra staff, say £3 per passenger per journey. Better seats, say £2 per passenger per journey over the lifetime of the seat.Total cost £55 giving a profit of £20 per customer. So a 1st class passenger is worth 4 times that of a standard class one even though they might pay only 50% more.

Clearly I made up those numbers but the point is correct.

 

[All Line Rover]

It is a shame that it's often so much more expensive - I'm not sure how it can be considered worthy value for very many hence the very light loadings.

And Yorkie's post highlights the absurdity of certain TOC's First Class pricing policies, particularly Virgin. A large proportion of travellers clearly don't like Advance tickets given the popularity of walk-up Off-Peak tickets (as demonstrated every weekday at Euston at 7pm). If you fall into this category and want to travel between Birmingham and London in First Class, it's £254 if you want to travel on the 07:30 to London and 17:23 back to Birmingham, with full breakfast and evening meal provided, and it's £254 if you want to travel on the 12:30 to London and 21:03 back to Birmingham, with a complimentary egg sandwich provided! Had you booked the night before, the latter option might have cost as little as £47. Where is the sense in that!? It's no wonder everyone chooses Standard Class at just £49.

Virgin cart around 24 First Class carriages on the Birmingham to London route every hour, mostful full of fresh air Off-Peak, especially once you exclude those travelling on cheap 1st APs who might be paying less than those in Standard Class. Why don't Virgin introduce a £99 First Off-Peak Return ticket along this route, with tight time restrictions to ensure it doesn't abstract revenue from those who would normally pay £254 for the Anytime Return? This ticket would surely be popular. Given Virgin are happy to sell First Class Advance tickets for as little as £47 return, £99 for a walk-up ticket seems about right.

 

[broadgage]

IMHO, many off peak first class fares are excessive, thus explaining the limited use of first class space on many off peak services.

I travel frequently between Paddington and Taunton, on a peak service such as the 18-03, the Golden Hind, first class a bit less than twice steerage, and arguably worth it. For this higher fare I can wait in the air conditioned first class lounge and enjoy free refreshments. On the train I get priority in use of the excellent Pullman restaurant, and am virtualy certain to get a seat, and at seat service.

Returning off peak from Taunton, a walk up off peak steerage ticket is about £40 and a walk up first single is about £170, or over 4 times as much !
There is no first class lounge at Taunton, nor freebies whilst waiting.

First class on the Golden Hind is often well filled and must be worth providing.
On the off peak trains it is less well used.
IMHO, TOCs should consider reducing First class of peak fares. If the off peak first class single from Taunton to London was reduced to say about £80 then it would be better used.
Perhaps off peak first class fares should be limited to twice the steerage fare payable on the same train ?

 

[bunnahabhain]

Hmm, you state that there is no costs of first class but then mention additional costs? I'm talking about the true cost of offering a first class service to a passenger.

Try reading it again. Then perhaps you may understand that your statement is incorrect.

 

[Butts]

There should be no class on the trains, everyone should get the same service, all people using trains are equal.

Dream on :roll:

"Some are more equal than others"

 

[HST Power]

Dream on :roll:

"Some are more equal than others"

Animal Farm rides again - or 'Cattle Class Farm' from the grand perspective of we Lords in First Class seats!

 

[SETCommuter]

If first class was removed, where would all the staff sit ?

 

[yorksrob]

I read many moons ago that First Class passeng provided BR with around 15% of ticket sales in the 1990s. I suspect that figure is a lot less nowadays as many businesses no longer allow employees to claim back first class travel expenses.

I also wonder whether the removal of noticeably more luxurious first class compartments has abetted the decline in first class profitability on the Southern Region, particularly during the off peak.