14 November 2009

Perverse and irrational?

Stagecoach lashed out on Wednesday, following news that the Competition Commission (CC) has ordered it to sell its recently-acquired Preston Bus company. Calling the CC's decision "perverse and irrational", Stagecoach said that it was an "irrational contradiction of competition law and common sense."

So that's no merger with NEG and no Preston Bus. What now?

I read a very candid rant on a transport news forum some weeks ago by a transport planner for a local authority, who lambasted the CC, following its preliminary report, for even contemplating that Stagecoach's acquisition of Preston Bus was likely to reduce competition. It's safe to say that this individual had nothing to do with any party involved and yet despite his position, and openly naming himself, paragraph after paragraph was churned out, slagging the CC off (my favourite was "don't these b*stards realise the car, yes the ****ing car, is the competition here, not other bus operators"). It's perhaps not strange to see that he no longer posts to this forum.

"The CC concludes that the sale of a reconfigured Preston Bus will be the most effective way to restore competition and safeguard passenger interests. The CC will approve the successful bidder to ensure that it is capable of operating as an effective competitor to Stagecoach. The sale will include a bus depot, other assets and a network of routes, including services formerly run by Preston Bus but since transferred to Stagecoach following the acquisition." forms the opening paragraph in the CC's full report.

Taking each aspect in turn, we first come to 'network of routes'. Since Stagecoach purchased Preston Bus, changes have been swift and relatively wholesale. Does Stagecoach have to turn the clock back to its competing routes pre-purchase and agree the newcomer to operate routes akin to Preson Bus' upon its commencement?

'The depot' could be construed to be relatively straightforward, but with the changes to routes comes inter-vehicle swaps between depots to operate the existing services. Sure, the services can continue to be operated but from separate bases, but this will mean additional dead running and therefore an increase in costs.

Who is likely to want to buy Preston Bus? The nearest large group is Transdev's Blazefield subsidiary, who've taken on work from Stagecoach in Burnley during 1998. First in Manchester, Arriva in Merseyside? Will smaller operators try and have a go? Remember MAS Transit in Grantham, when RoadCar closed its depot there - a complete disaster; today, Centrebus operates services a shadow of their former selves. A year ago, you might have thought Veolia could come and have a go - maybe they will, especially since their planned merger with fellow French operator Transdev is well advanced.

Finally, the CC made a lot of noise about safeguarding the best service for the passenger, which is fair enough. But at the moment, a Preston-wide Megarider is available, offering travel on all Stagecoach and former Preston Bus routes. This will surely be offered only Stagecoach services after the Preston Bus sale has taken place. With the Tories thought to be against Quality Partnerships, even this possibility for trunk routes in the area is likely to be a non-starter.

What if no operator shows an interest in the former Preston Bus business? What if they, like MAS Transit in Grantham, cannot make a go of it and head off to the hills with their tail between their legs, what then? (GWB)

The CC report in full (86 pages in pdf form) can be read by clicking here.