The two times I've used the HOW services from Shrewsbury (14:05) they've been pretty much full. A lot of these passengers leave at Knighton, with another large amount leaving at Llandrindod. There are still other passengers on board, trickling on and off request stops en route.
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The last train back to these towns is way too early, .....
I think you are probably getting close to the problem(s) here.
The current timetable, and the one employed for years before that (ie as per a Saturday right now) is really a 'maximum' affordable basic (ie minimum) timetable for the central section of the line, that is between Llandrindod and Llandovery, or perhaps to Llandeilo.
But this basic service is really inadequate for the more populated northern end (Llandrindod and Knighton to Craven Arms/Shrewsbury) and is almost useless for the southern end, most especially the significant populations from Amannford to Llanelli/Swansea.
What the powers at be tried to do with the new service is supplement the basic service with an extra train at each end in the morning, using the logic that five trains a day over the outer sections has to be better than four (even if both options are pretty pathetic).
On paper, that would appear to be true, especially as, at the southern end, the new timetable provides a commuter time arrival in Swansea. (If, perhaps, a bit too early to be ideal.)
But what it seems to have done is alienate some old-time passengers, while failing to be an improvement good enough to attract significant numbers of new clientel.
IMO, one of the key problems is that, however the morning service is strengthened even if three trains were provided - if there is no improved afternoon service back, it must make commuting to Swansea or Shrewsbury a joke for most potential users. Because between 14.00 (or so) and 18.00 plus there is simply no train at either end.
So, as things stand, if you finish school/college/work/shopping in either of the end line between 15.30 17.00, you still have to wait until 18.00 plus for a train home, with an arrival at the doorstep probably at 19.30 at the earliest, more likely around 20.00.
How unnattractive is that?
Yet you advocate an even later last departure! Fine if you can get the stock, but not at the expense of the current last departures.
Considering the the current allocation of stock and crews, the schedule today is probably the best compromise on offer. But it is surely not getting the best out of the fixed assets.
The central section of the HoWL is a basket case. Keep the four trains per day as a minimum service for those without alternative transport
But the current five trains a day at the northern and southern ends is what youmight call a "life support service", it is simply inadequate as a basic service for these areas. As a minimum, both Swansea and Shrewsbury need trains departing around 17.00* in order to offer, together with the current 18.xx departures, some sort of sensible commuting options to Llandeilo and Llandrindod respectively.
*In practice, due to pathing constraints between Llandeilo and the Swansea District line (I forget the name of the Jcn), I think to fit into the current TT, any extra train from Swansea would have to leave around either 16.00 or 17.20.
Longer term, a new loop needs to be put in at Ammanford or Pantyfynnon, and a proper hourly commuter service introduced between Ammanford and Swansea, with maybe a few trains extended to Llandeilo and/or Llandovery.
Whether money, stock and will can ever be found for such an option is another matter.