How much of the downturn is a result of the sharp fall in petrol prices last year - to as low as 99p per litre at one point? It’s now rising again and is currently around £1.20 - if that was the problem, is it now in the past?
“For some time the models were predicting growth, and the reality was even higher than that. So what’s happened is almost certainly a correction - we’re now back to what the model predicted. All of the scenarios we are currently modelling are actually giving us more confidence in those models, and in many cases they are broadly right. And yes, we got to a critical point on petrol prices which had a bigger effect than we might have expected. So we can expect to see growth coming back. But we shouldn’t be complacent about the other things going on in car technology.”
Autonomous vehicles or driverless cars?
“Indeed. Are we really going to see self-driving cars bringing masses of people into central London? Or is it more likely that such technology will get people to their commuter station? I think it is. So that would not be competition for the railway. The big question is how we deliver that end-to-end journey and how cleverer interfaces potentially change things like the car parking, which is becoming a huge constraint.
“I just find it very difficult to believe that mass commuting will change significantly - likewise for long-distance business and leisure travel. The train is a very powerful market. Is it best for everything? Of course not. But is it a competitive product? Absolutely.”
What about the thorny question - certainly for established TOCs - of open access passenger operation?
“One of the biggest issues is again that there is consistency between DFT, ORR, the franchise model and the way in which track access is granted. That’s another one of those difficult conversations needed to ensure that the industry does not get pushed in different directions in either franchises or regulation.
“I agree that there is a really powerful place for open access competition. But we need to be clearer about whether we see that on some parts of the railway as being very open, liberal competition for paths, while on other parts of the railway it might be limited competition for spare capacity. On other parts of the railway we’ll say there’s no prospect of open access. I think it’s powerful to have separate infrastructure and operations because it gives you the opportunity to do things differently in different places rather than the current ‘one size fits all’ open access mindset.”
Liberal competition hasn’t worked well where it has been tried, has it? In Europe, there has been chaos where it has been applied.
“Where could it work?” he asks. “Where could you apply that liberal approach? There are only limited places where you could do it. We could collectively decide that on some of those long-distance corridors we are going to have a more liberal approach rather than a few bits at the edges. But we should be explicit about that decision and then be consistent with it, rather than pushing people in different directions.
We keep coming back to the DfT, don’t we?
“It’s not just the DfT but ultimately, yes, they need to decide some key things.”
What about freight? The freight operators are key RDG members and yet don’t seem to get much air time?
“One of the things I’m most pleased about is the RDG freight group, which is bringing all those operators together. In the past they haven’t really had that sort of forum, and therefore haven’t had the basis for expressing a common voice with legitimacy. I think that’s really good.
“In terms of freight marketing, we need to get a whole lot better at it. Coal was always going to disappear, and that’s very painful, but we can’t be shocked. For many years the railway has had to respond to what was happening in power generation and was under huge pressure to provide more capacity. That’s now gone away, and this time it’s very unlikely that it will come back. The flipside is that the intermodal market continues to be strong, and we need to promote that. It’s where rail freight can make a really significant contribution to the economy as well as to the environment and road safety.”
I’m slightly… frustrated. I’ve heard all that a thousand times before. Isn’t it time for something different? Can there ever be a breakthrough into a genuinely new market - there’s never going to be a better driver or incentive than the collapse of coal?
What about the rapidly escalating air/diesel engines concerns in London? Was there ever a better time to hand London Mayor Sadiq Khan a solution? Is it not time for a really bold trial of roll-cage freight into London at night, with a fleet of clean electric lorries delivering in the small hours?
It would tick so many boxes that it’s a no-brainer in principle. And guess what: all the infrastructure you’d need for a trial is there, unused at Euston. The old parcels deck above the platform could handle hundreds of road vehicles, and there’s easy road access to the platforms below….
“I don’t see a great momentum for that at the moment…”
No, neither do I. That’s a big part of the the problem. Maybe the Rail Delivery Group should create one?
This feature was published in RAIL 820 on 11th February 2017
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Nick Jones - 25/04/2017 18:18
Good searching and very relevant questions. Unfortunately answers were punctuated with " we need that debate /conversation.......". In other words no real answers. Disappointing but not surprised.
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