Open Access Operators

[TheWalrus]

I'm not sure this hasn't been discussed before but could open access operators play a key role in the future of the railways?

Open Access companies identify flows which could be catered for profitably, without government funding. They provide a good service to their customers and are continuously improving and increasing service provision. Hull Trains has been a successful operation for a number of years now and recently have been considering paying for Hull-Selby electrification. This is exactly the sort of private sector investment the railway needs without the need for government support.

On the other hand there are many disadvantages to having Open Access. Abstraction of revenue from franchised operators could lead to increased revenue support which would be counter productive. Also they pay less to operate services (not sure what exactly so maybe someone could clear that up?) which gives them an unfair advantage.

Overall I think Open Access Operators are good for the railway but maybe the system needs revising. I would suggest letting them keep their costs down and maybe temporary financial support until they are established and making a profit. Then maybe they should pay a percentage of their profits to the government as a premium much like franchised operators.

What are your thoughts on this?

 

[ainsworth74]

Open Access companies identify flows which could be catered for profitably, without government funding.

Not sure I'd agree with that interpretation. The two successful OAOs have been good at identifying already profitable flows (London - Doncaster/York) and tacking extra routes on top of that to avoid accusations of being purely abstractive. The situation has improved somewhat, Hull and Sunderland/Bradford are generating more through traffic but I'd imagine that the a lot of their revenue still comes from York/Doncaster tickets and without them they'd most likely go under.

I would suggest letting them keep their costs down

They already do. They only pay variable track access charges rather than the fixed track access charge that TOCs have to (on top of variable track access charges).

 

[westhouses18b]

The two replies above were replies I was going to make, the only things I;d add is that it's a shaem "Glasgow Trains" never quite managed to introduce the Nottingham - Glasgow service they'd proposed, http://en.wikipedia.org/wiki/Glasgow_Trains For that would have ben a genuinly innovatvive OAO Service, all the rest involve London and to some degree an ORCATS http://en.wikipedia.org/wiki/ORCATS rais on a TOC's revune.

 

[TheWalrus]

So ainsworth74 what you are saying is yes they can run a profitable service from say London-Bradford but it is reliant on passengers from Doncaster - with only the revenue from stations north of Doncaster it would not be profitable.

 

[anme]

I'm sympathetic to the idea of open access operators, but the reality is that almost any useful service will be abstractive to some degree, and will negatively affect one or more franchised operators. This affects the viability of these frachised operators who are on long contracts with set levels of subsidy or premiums. These companies will understandably try to block such new operators.

The problem is the frachising system, which locks operators and the government into long term, inflexible contracts while requiring micromanagement from Whitehall.

 

[Metrailway]

Am I right to believe that no Open Access Operator (excluding Heathrow Express) has made year on year profits?

 

[merlodlliw]

Am I right to believe that no Open Access Operator (excluding Heathrow Express) has made year on year profits?

It needs to be mentioned, ATW run an O/A service for Welsh Government, it runs Holyhead/Cardiff/Holyhead once a day Mon/Fri, it has a First Class dining car which very few if any use, WG pays ATW £1.4M a year to run the service, plus WG paid for the rolling stock.
This service makes a loss even with the subsidy, so reliable sources tell me.

Bob

 

[TheWalrus]

Metrailway what about First Hull Trains?

 

[ainsworth74]

Metrailway what about First Hull Trains?

My understanding is that they've been in profit for a few years now. It fluctuates (last years was worse than the year before) but they are profitable. Presumably this is why First Group are willing to splash some cash on wiring in exchange for a nice long track access agreement.

 

[westv]

Sorry to go off topic but, if wiring was put in between Hull and Selby, how long would such an operation take to complete?