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Rail revenue

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David Sinnett

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As a comparative newbie to the rail industry, I'm curious how an Open Access operator gets its revenue. A lot of station pairs are connected by several operators so I'm guessing the revenue of each ticket sold is divided in some way between the operators. Open Access operators, I believe, can't milk the main routes so have to open up new flows and, it seems, have more attractive ticket prices. If that is the case, they need a greater generation of revenue yet ticket revenue is still shared??
How does it work? Presumably GrandCentral share all revenue from York to London with NXEC and also get a cut of other operators revenue and then Sunderland to York with Northern and any other operator on the route.
 
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djw1981

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It is called ORCATS and teh Rail Settlement Plan (RSP) and there is more info on the ATOC website, and on wikipaedia. they use flow numbers from LENNON for the actual numbers.
http://www.rail-reg.gov.uk/server/show/ConWebDoc.8090
http://www.guardian.co.uk/money/2006/may/27/consumernews.travelnews
http://www.savethetrain.org.uk/info/361_A_new_operator_improved_business_case.html
http://www.atoc.org/rsp/
--- old post above --- --- new post below ---
If a ticket is marked GC only, as the GC tickets sold by them on their train are, then they keep all the money, as NXEC do on NX only tickets sold. A York-London Open ticket will be split according to teh relative loadings between York and London.
 

Mojo

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It's also worth adding that the TOC which prices the flow can't set their own TOC-specific ticket that is lower than the Any Permitted fare. For example York to London which is priced by NXEC who can't create a NXEC only ticket which is lower than the Any Permitted. This is probably why many InterCity TOCs create their own TOC-specific tickets priced slightly higher than the Any Permitted which include money off in the buffet, car parking, tube travel, etc.

ORCATS (Operational Research Computer Allocation of Tickets to Services) was developed under BR to allocate revenue between the sectors and is now used under privatisation to allocate money to TOCs.

You've also got the practice of 'ORCATS raiding' where TOCs run a number of services between stations to get a disproportionate amount of money compared to the number of passengers they actually convey. Some suspect that this is what GC are doing with their Midday run and York stops, but there are plenty more arguments against this so I think it can be discounted. Other examples include the daily Crosscountry services to Cardiff via Bristol TM, but cynics amongst us now suspect the DfT has something to do with these trains as they provide capacity FGW don't have on the busiest train of the morning from Cardiff to Temple Meads, as they use the 0700 Cardiff path (but don't call Lawrence Hill or Stapleton Rd.)

"An arbitrator may be requested to order an alternative basis of allocation where a passenger operator entitled to an allocation does not consider that the exisiting ORCATS allocation properly reflects actual passenger miles travelled. The arbitrator will base his decision on evidence of the actual passenger miles travelled presented to him by the passenger operators concerned." There are many stories of TOCs getting people to ride on other TOCs trains to try & challenge their allocation by taking passenger counts.
 

Tom B

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What about AP tickets? You can get a £9.50 AP ticket valid on a specific NEEC service only, whereas the cheapest Saver Single is £62.80! (NB pre January fares, but the point stands).
 

Mojo

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It never applied to Advance Purchace tickets.
 
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