First Group: General Discussion

[Volvodart]

As I suspected, from the analysts presentation for the results, First bus are intending doing elsewhere what they have just done at Aberdeen regarding cutting drivers' terms and conditions.

 

[winston270twm]

As I suspected, from the analysts presentation for the results, First bus are intending doing elsewhere what they have just done at Aberdeen regarding cutting drivers' terms and conditions.

Surely the reaction & response they got from drivers in Aberdeen to the revised deals should deter management from cutting any drivers benefits, especially when drivers are hard to come by in so areas.

 

[Volvodart]

That was what was said to the audience,

 

[TheGrandWazoo]

As I suspected, from the analysts presentation for the results, First bus are intending doing elsewhere what they have just done at Aberdeen regarding cutting drivers' terms and conditions.

Where is that presentation ?

 

[Goldfish62]

Where is that presentation ?

On the FirstGroup corporate website.

 

[TheGrandWazoo]

On the FirstGroup corporate website.

sorry - blonde moment. Did look and could only see the announcement/releases - got it now. However, can’t see much other than “driving efficiencies in local and divisional cost base” and local companies tailoring costs to local conditions. Am I guilty of more blondeness??

 

[DragonEast]

What else is there to do for FirstBus except look at costs? Borrowing costs are reducing, but it's not an overnight transformation. Where are the missing passengers gagging for a First bus? So what costs are there remaining to look at except staff t&s, which seem to vary quite a bit at least looking at advertised salaries; if First are to be competitive? (The competitors may have greater staff recruitment/retention issues, but they still cope, often better on margins). They've looked at depots, maintenance/replacement and back office, and reduced the lot. Unison hold the key, perhaps? The magic public funding will go to the successful, not the unsuccessful surely - it's not a lifeboat (or if it is, then a leaky one)?

Despite our best wishes FB don't exist in a bubble. Surely how they compare with their competitors/comparitors matters, a bit? Mostly on the operational side I don't see them doing much different to anyone else (except for investment and we know why that is) and t&cs. If buyers would make a success of the business, it'd be because they can tackle those issues where First can't (or can take advantage of consolidation - limited opportunities with the dispersed First "network"), and who is going to pour investment into a loss making business without making it operationally viable? Fares have gone up already, and First aren't the cheapest.

As for sales, should First be concerned that they do the hard work, and someone else then reaps the benefit? As a competitor or successor that's what I'd be interested in. Is that the code for the constant mentions of shareholder value? At least the remnants of Berkshire have one of the closest to a captive passenger base, perhaps?

 

[Blackpudding]

That was what was said to the audience,

sorry - blonde moment. Did look and could only see the announcement/releases - got it now. However, can’t see much other than “driving efficiencies in local and divisional cost base” and local companies tailoring costs to local conditions. Am I guilty of more blondeness??

Are you sure you are talking about the same presentation as 'Volvodart'? Is he talking about an investors conference (audience)?

 

[TheGrandWazoo]

Are you sure you are talking about the same presentation as 'Volvodart'? Is he talking about an investors conference (audience)?

Fair point - Volvodart had originally said the investors presentation so I was more on a powerpoint train of thought and was looking at this http://www.firstgroupplc.com/~/medi...ons/presentation/fy-2018-presentation-may.pdf rather than the audio

Changing working practices through renegotiation at about 12:30 in.... There are doubtless some OpCos where some Spanish practices exist and may be looking at buying these out in some way.

What else is there to do for FirstBus except look at costs? Borrowing costs are reducing, but it's not an overnight transformation. Where are the missing passengers gagging for a First bus? So what costs are there remaining to look at except staff t&s, which seem to vary quite a bit at least looking at advertised salaries; if First are to be competitive? (The competitors may have greater staff recruitment/retention issues, but they still cope, often better on margins). They've looked at depots, maintenance/replacement and back office, and reduced the lot. Unison hold the key, perhaps? The magic public funding will go to the successful, not the unsuccessful surely - it's not a lifeboat (or if it is, then a leaky one)?

Despite our best wishes FB don't exist in a bubble. Surely how they compare with their competitors/comparitors matters, a bit? Mostly on the operational side I don't see them doing much different to anyone else (except for investment and we know why that is) and t&cs. If buyers would make a success of the business, it'd be because they can tackle those issues where First can't (or can take advantage of consolidation - limited opportunities with the dispersed First "network"), and who is going to pour investment into a loss making business without making it operationally viable? Fares have gone up already, and First aren't the cheapest.

As for sales, should First be concerned that they do the hard work, and someone else then reaps the benefit? As a competitor or successor that's what I'd be interested in. Is that the code for the constant mentions of shareholder value? At least the remnants of Berkshire have one of the closest to a captive passenger base, perhaps?

I do get somewhat confused by your posts and don't know what you mean by Unison hold the key. Do you mean UNITE? Also, I don't know which operations you see (is it just First Essex/Eastern Counties). Rest assured that there are many local differences, with Bristol very strong whilst Buses of Somerset is a very sickly child. Different OpCos, different local authorities, different demographics - unless we're now advocating the return of central standardised diktats from Aberdeen

The emphasis on cost control is crucial. I know people have complained about the Rotherham and Bury closures but it really was a no brainer and, arguably, should have been done years ago. I could point to a number of other areas that, IMHO, could also be rationalised. Now, I know that businesses must also promote growth (in the current climate, First have done well to maintain passenger numbers). They do need to be making more money but whilst maintaining the current cost base of better. Note that TAS does measure the major groups and Stagecoach is usually the cheapest but First is relatively close behind and better than Go Ahead et al!

The natural view is to go out for growth but a) there's no point in halving your fares to get twice the patronage and b) it is much easier to save £100k than to generate another £2m of revenue to make £100k. As it is, the steps that UK Bus have taken seem to be one of the few bright spots in the annual results.

As always in any large business, there are some flat spots in UK Bus and it is a challenging environment.

My feeling (and I've shared this with others via PMs - you know who you are) is that there will be some more selective retrenchments with UK Bus and more rationalisation of depots etc. I can think of a few that might be at risk. Clearly, despite what was said, Greyhound will not survive in its current form and I'd back a disposal. However, it also feels like a UK/US split might also be a logical step.

The one curious thing is the TPE statement. My contacts in First Rail had given me the heads up on the challenge with TPE (more relaxed with SWR) but wonder if they're trying to engender goodwill with the government by soaking up £20m a year in losses; will any new CEO accept that or will it depend on GWR (which makes the real money).

 

[DragonEast]

You're right, I am confused.

Yes, I understand that First are trying to turn around their poorly performing OpCos, and that is often one step forwards, two steps back, for anyone. And Buses of Somerset (not the only one) and First Essex may both be basket cases (not the only ones), though one perhaps medium sized, and one larger. I suspect though that Somerset is supported by Bristol, and First seem to me to have what may be a sensible strategy of consolidation in the south-west, and to focus on metropolitan areas where public transport investment is concentrated. They can't find a way to dispose of either unit, well not at a decent price.

Yes, I am trying to work out where Essex fits in this. Norwich doesn't perform the same function as Bristol does; it's not a regional centre in the same way, and doesn't provide anything like the same level of public support.

What nothing seems to help me with is why Essex are in this state. I can explain it. But it's more heavily populated than Somerset, I suspect, and it's geography may be more amenable too. The point is though that First seem to do hardly anything that its neighbours do in the Home Counties to make their services viable, being more of a one track pony that does only one thing: withdraws from and closes peripheral units, as it (and its predecessors) have over the last half-century. But by their own lack of action on the rest of the network they make decline inevitable - and I don't mean using more resources (which First don't have) but I mean using resources efficiently and not wasting resources. They seem more like NBC that just tried to do everything because that was what they'd always done - or gave up. But it's a long-time a-shrinking if that's its chosen route of exit (or by necessity). Its would-be competitors just have to wait, and it will hand them a network on a plate - as in Clacton (though there out of necessity, not choice, and it might turn out a poisoned chalice, though I am inclined to doubt it, in the light of previous history). I just find it strange behaviour for a commercial company (though not unknown - some retailers have been like High Street ghosts for years before they actually gave up the ghost, BHS for example), and nothing in First helps me explain it. They've lost the will - it shows too when they do anything (like the introduction of bus tracking and cashless - the local implementation is a right hash, as often are the introduction of service alterations). Regular travellers tell me the attitude often infects drivers too, though I'm aware that in many places they are a moody bunch, but locally it's more than that. They lost a local MD, and now bring in one from anywhere it seems, as some sort of caretaker. Local management seem to be deserting too. They may have problems but I don't see this "lost the will" elsewhere (and not in Eastern Counties, nor I suspect in Somerset, Berkshire, Manchester or South Yorkshire, for example); the Essex OpCo have more of a suicide note than a business plan, it feels like. Not just to me.

 

[overthewater]

What if First looked around and said lets have let have deal with flixbus? Said company want to expand in the USA, while greyhound has the network it just needs overhauled, could be worthwhile idea long term Especially in the West coast/ Mexico or Texas area?

The natural view is to go out for growth but a) there's no point in halving your fares to get twice the patronage and b) it is much easier to save £100k than to generate another £2m of revenue to make £100k. As it is, the steps that UK Bus have taken seem to be one of the few bright spots in the annual results.

That has raised an eyebrow, surly you want to generate more ...Day and ...Weekly tickets? instead of the cash fares?

 

[GusB]

Interesting snippet from the P&J: https://www.pressandjournal.co.uk/f...ut-potential-take-over-of-first-bus-aberdeen/

Council will begin talks about potential take over of First Bus Aberdeen

High level talks between Aberdeen City Council and First Bus are to take place – with the local authority understood to be maneuvering for a future bid to run the city’s buses in the future.

First Bus took over Aberdeen services in 1989 and senior First figures have poured cold water on the idea of a sale, saying they are “not interested”.

Setting up a council-run bus company, similar to the city’s previous Grampian buses or Edinburgh’s Lothian buses, has however been at the heart of Aberdeen Labour’s manifesto during last year’s local elections.

And council co-leader Jenny Laing, of Aberdeen Labour, said she had instructed civil servants to begin talks about the “company’s intentions” for the future.

The break-up of FirstGroup has been predicted by city analysts since a preliminary takeover bid from North American private equity investor Apollo Asset Management.

It is understood that if the council took over First Aberdeen it would run all the services and take over the bus depot on King Street.

Council leaders are waiting on the publication of a new transport bill this month which is predicted to give powers to councils to run services.

Mrs Laing said: “I have today instructed our director of resources, Steven Whyte, to liaise with First Bus Aberdeen in order to get a better understanding of the company’s intentions for Aberdeen following the announcement that the First Group are looking to restructure the company.

“I am positive that the people of Aberdeen would be pleased to see a municipal bus company established in the city to run buses for and on behalf of the citizens.

“We are obviously at a very early stage of trying to progress these plans and the legislation which would enable local authorities to proceed is currently not in place.

“However, the administration is keen to continue to explore all options regarding the setting up of a municipal bus company in Aberdeen.”

David Phillips, operations director for First Aberdeen said in response: “We are not interested in selling all or part of the business.

“We simply would not have gone through the heartache and pain of scaling the business over the past year in a bid to meet the challenges of the current economic climate in Aberdeen, if our plans were simply to sell up.

“Aberdeen is birthplace of First Group and will remain an important part of our business moving forward.”

On one hand the article states that high level talks are to take place, yet at the end it quotes a First spokesperson as saying they're not interested! There's also the inaccuracy that First took over in 1989 - I assume they meant when the original sale of Grampian Transport took place. It is the P&J, I suppose.

 

[overthewater]

Maybe the First spokesperson should speak with the new CEO about taking the money and running :P I believe this when I see it...

 

[Robertj21a]

This appears to contradict earlier comments from First Group that they would be prepared to consider offers for all or part of the business. I wonder if David Phillips is following a new policy, or simply is not fully in line with his bosses.

 

[Dai Corner]

Isn't 'going through the heartache and pain of scaling the business' just what an owner would do if he wanted to sell it for the best possible price?

 

[TheGrandWazoo]

Isn't 'going through the heartache and pain of scaling the business' just what an owner would do if he wanted to sell it for the best possible price?

Tbf, you can make the argument in any circumstance. Do nothing and invest nothing - it’s because it’s not worth doing as you’re ready to offload. Do something like a new ID or face into IR issues - it’s because you’re prettying it up to be ready to offload.

 

[Jordan Adam]

Saw that news article earlier, typical Aberdeen Journals dribble. Aberdeen City Council can't manage a toilet cleaning rota, never mind a full scale bus service.

Simple answer is it ain't gonna happen!

 

[TubeMapCentral]

As a user of First buses in Colchester for over 20 years, I suggest we should be surprised they have any passengers left at all here. They seem to function better at Chelmsford, but failure to even acknowledge Colchester's chronic traffic congestion proplems has driven the optional traffic away.

Examples? They refuse to time their routes differently during congestion periods versus quiet times, making timetable collapse inevitable. Likewise they structure routes so that they cannot run to time. To add injury to injury, their late-running drivers shut down and run empty to depot, effectively cancelling all evening service at an extreme.

Essex is a prosperous county with good roads and rail services, First Essex are a joke here. Good riddance to them!

 

[overthewater]

Colchester has two other players in the town.. you can't just blame First.

 

[158756]

Saw that news article earlier, typical Aberdeen Journals dribble. Aberdeen City Council can't manage a toilet cleaning rota, never mind a full scale bus service.

Simple answer is it ain't gonna happen!

As the article acknowledges, they can't legally do it anyway. The question must also be asked that if it's in such a state that First want rid, are Aberdeen council in a position to invest to turn it round, or to bear the losses?

 

[Jordan Adam]

As the article acknowledges, they can't legally do it anyway. The question must also be asked that if it's in such a state that First want rid, are Aberdeen council in a position to invest to turn it round, or to bear the losses?

It's very highly unlikely that First want rid of Aberdeen, anyone with a brain and knowledge of the area can realise that! it's a good preforming area that's not got any real troubles. Aberdeen City Council would likely allocate most of the budget to vanity projects such as Marischal Square, pointless bus gates and then moan about them not having the money to run the bus services, leading to cuts.

That said they currently fund the 15A and 94, both of which are really just pointless money pits. The 94 carries more ghosts than passengers, ironic as it goes from the hospital to the crematorium!

It always strikes me as funny when people use examples such a Lothian Buses, they seem to forget that LB operate in Edinburgh the capital with a massive tourist industry. So of course they're going to splash the cash on them! Where as places such as Aberdeen, Dundee and possibly Glasgow would get somewhat ignored.

Personally i think the industry needs to be kept in the private sector, but there needs to be more locally based operators (Craig Group for example) as these large nation wide companies really just don't work.

"rant" over...

 

[GusB]

It's very highly unlikely that First want rid of Aberdeen, anyone with a brain and knowledge of the area can realise that! it's a good preforming area that's not got any real troubles. Aberdeen City Council would likely allocate most of the budget to vanity projects such as Marischal Square, pointless bus gates and then moan about them not having the money to run the bus services, leading to cuts.

That said they currently fund the 15A and 94, both of which are really just pointless money pits. The 94 carries more ghosts than passengers, ironic as it goes from the hospital to the crematorium!

It always strikes me as funny when people use examples such a Lothian Buses, they seem to forget that LB operate in Edinburgh the capital with a massive tourist industry. So of course they're going to splash the cash on them! Where as places such as Aberdeen, Dundee and possibly Glasgow would get somewhat ignored.

Personally i think the industry needs to be kept in the private sector, but there needs to be more locally based operators (Craig Group for example) as these large nation wide companies really just don't work.

"rant" over...

Much as I'd like to see city bus operations returned to local control, I can't see this happening either. Aberdeen is arguably the "spiritual home" of First, as well as the location of a their fairly new headquarters, so I can't see them getting rid of the operation any time soon. Having said that, the Aberdeen operation is very much self-contained and isolated from the rest of the group. If First were to relinquish control, they'd have no real reason to keep head office functions in the area.

 

[bussnapperwm]

In other news, "along the Salt Road" will be the newest brand to come to Worcester.

It is being applied to service 144/A buses.

The launch of the new brand will be in Birmingham tomorrow (Saturday)

 

[TubeMapCentral]

Colchester has two other players in the town.. you can't just blame First.

Um, why not? Do you have evidence that these operators are also guilty of what I outlined?

 

[Volvodart]

Much as I'd like to see city bus operations returned to local control, I can't see this happening either. Aberdeen is arguably the "spiritual home" of First, as well as the location of a their fairly new headquarters, so I can't see them getting rid of the operation any time soon. Having said that, the Aberdeen operation is very much self-contained and isolated from the rest of the group. If First were to relinquish control, they'd have no real reason to keep head office functions in the area.

Most of the Aberdeen operations are now run from elsewhere, or shared with First Scotland East, so the Council would have to reinstate all these functions at Aberdeen, and it would have effect on FSE's profitability as there is no business it could share these functions with.

 

[Dentonian]

As a user of First buses in Colchester for over 20 years, I suggest we should be surprised they have any passengers left at all here. They seem to function better at Chelmsford, but failure to even acknowledge Colchester's chronic traffic congestion proplems has driven the optional traffic away.

Examples? They refuse to time their routes differently during congestion periods versus quiet times, making timetable collapse inevitable. Likewise they structure routes so that they cannot run to time. To add injury to injury, their late-running drivers shut down and run empty to depot, effectively cancelling all evening service at an extreme.

Essex is a prosperous county with good roads and rail services, First Essex are a joke here. Good riddance to them!

Refusing to register realistic timetables and drivers summarily parking up! Don't you have a Traffic Commissioner in the South East?

 

[Bungle965]

What's going on with Manchester and their ticketer machines? Last I heard they were supposed to have been introduced in February February is now turning into July and they still haven't got them and are still on the Almex's.
Sam

 

[Kahuna47]

Offical memo from their staff app - we 'should' have them by the end of August...

 

[DragonEast]

Refusing to register realistic timetables and drivers summarily parking up! Don't you have a Traffic Commissioner in the South East?

Yes, Eastern, and First Essex have been hauled before them, when the (former) management promised to be good boys and do better in future. The future is here and I defy anyone to find any difference. Chelmsford (or Basildon) better . . . that's the biggest joke of the lot! The kindest thing we can probably say is that they are trying (the wrong word, perhaps) to do too much with too few resources. Why? the biggest mystery of the lot. It makes no sense the way they collect and cling on to uneconomic routes. More buses = better buses. It doesn't when reliability goes to pot. Closing Clacton and Braintree doesn't, I suspect, even begin to address their real problems.

PS In my wildest imaginings I wonder if when Essex acquired the former London MD he came with a brilliant idea to try and replicate London style services, without the resources or subsidy to do so? And the management team he brought with him can't quite bring themselves to acknowledge the mistake. But of course no-one could be that stupid, could they?

 

[DragonEast]

Well, First Essex drivers are adding to their benefits, apparently!

Which surely is the point about First. They are so much at sixes and sevens that they couldn't be consistent even if they tried.