TheGrandWazoo
Veteran Member
TGW. First depreciate vehicles in a 'straight line' (with exceptions I would expect) and so I don't believe there is a need to 'take a chunk' out. Other companies may be different.
True - they do straight line rather than RD but it isn't my point. Rather than having a higher amount of assets in an OpCo against a relatively weak equity position, you can reduce the imbalance and increase ROCE.
Stagecoach used to do it with Manchester, sending Tridents there for 2/3 years and then sending them to places like Gloucester. A smart way of updating the fleet without putting too much strain on the finances and, of course, this had patronage benefits so that they could then get new fleet eventually
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