Now they\’e just being silly

According to a Department for Transport report, some off-peak single tickets cost just 10p less than returns.

The report says: “Passengers who expect fares to be roughly consistent on a distance basis may perceive inconsistencies where in fact fares have been set on a commercial basis (within the constraints of fares regulation).

\”This may leave passengers feeling that they are paying more than they should, for example where a return is only marginally more expensive than a single.

Twattery, all around me nothing but twattery.

Off peak returns are deliberately cheap because railways have a large fixed cost and a very low marginal cost. Thus you\’ve large spare capacity in the middle of the day because you set things up to deal with peak demand. Why not offer tickets at above your marginal cost but below your average cost in order to fill some of that spare capacity? To encourage people who otherwise would not travel to give you some of their money? You know, awaydays.

If you\’re then going to start using those deliberately below average cost tickets as the baseline for the prices of all tickets you are being a massive and absolute twat.

Either that or we\’ve been infested by Marxists again. That very Soviet idea that the value of transport is the weight transported times the distance transported (no, really, that\’s how Soviet GDP figures were calculated. Moving 2,000 tonnes 3,000 km obviously, obviously, created more value than moving it 50 metres. Which is why you had plants using raw materials from 3,000 km away rather than building them next door to their supplies.).

10 comments on “Now they\’e just being silly

  1. Also encourages those who do not need to use peak travel to use off peak, spreading the load of humans and not causing even more overcrowding.

  2. Ha. what pisses me off is that here you cannot even choose to pay your way out of the peak crush without months of advance planning. The train company (Deutsche Bahn anecdote alert) sells 75% of the seats as reservations to the people getting the €29 tickets purchased months in advance. Even on peak trains. So if you have the temerity to want to pay full whack, you end up standing.

    It gets worse in first class – they continue to sell discounted first tickets, at _below_ the full second class fare once they have run out of discounted tickets in second. So you get all the hoi-polloi taking ten of the complimentary newspapers each (because they’re complimentary and Germans like nothing more than free stuff), and getting all the seats with their cheap ticket reservations. At least you get a slightly wider aisle to stand in.

  3. I was thinking about return tickets the other day; I realised that I see them as buying an option on returning. If I do in fact use the same means of transport to get home, then it’s cheaper than buying two singles. If I don’t, it’s wasted money. So the single is a ‘fair’ price for a journey, and the return is a hedge for both me and the transport provider.

  4. Goes the other way with airlines, on most routes the singles are more expensive than the returns, and indeed if you book a return and only fly the out leg, the airline reserves the right to charge you the difference. Though I’ve never heard of it happening.

  5. @ JamesV

    That’s interesting about airlines. My rationale for that would be thus: Airlines make more money if there’s someone in a seat than if there’s noone in a seat. This applies even if the person in the seat doesn’t buy anything from the airline, because most airports pay for passengers (the ‘no-frills’ boys flying from Doncaster to Costa Del Obscura probably charge the airports more than they charge the passengers).

    So.. Someone who goes to a place and doesn’t come back (or comes back with another airline) is worth much less than someone flying return. Given that the plane needs to come back anyway, there’s actually almost zero cost to the airline for the return trip.. so there’s no point charging the passenger for it at all.. may as well, indeed, subsidise it a little (or, rather, fine the passenger who won’t come back).

    Of course, the ‘non-ticket’ passenger income can be such that both legs of a trip can be subsidised.. which is where yr £1 Ryanair flights come in.

    But, broadly speaking, the price you pay for the ‘single’ journey needs to cover whatever the airline needs to get the plane there and back. And if you don’t come back then that’s costing them.

    I wonder if it works differently for domestic flights in the US? I’d expect they have a lot more round trips or other non-return journeys, and probably less competition between marginally sustainable airports leading to subsidies.

  6. @TTG, I’m talking about real airlines. I think the cheaponasty airlines full of sweaties heading to Antalya, Benidorm or the Algarve (ducks) technically only sell one-way tickets anyway. The higher one way charge is thus all about rooking business travellers, though the overwhelming majority are wise to it and, as I said, unless you did this on a regular basis the chances of the airline trying to charge you the difference are minimal.

    You might not be coming back, but someone else almost certainly is. I’d guess generally one-way traffic is more or less balanced by direction. So the “cost” for the return trip is opportunity – someone else’s bum could be on that seat. Which is where it gets silly to sell returns cheaper than one-ways, because someone not returning will rarely bother to cancel, rather they will just no-show. Again, this is more relevant to the business routes than Aybeefuh.

    Most airports don’t pay for pax, they charge the airlines for them, (a few odd exceptions where passengers pay direct – like NQY where you have to pay 5 quid to get a ticket to get into the departure “lounge”). The airport passenger charge at my local is around €30, so a good proportion of the ticket price, if you get a cheap deal. Ruinair are experts at milking airports prepared to pay the airline for passenger traffic rather than charging the airline for a slot. That trick presumably works at any airport with idle runway and handling capacity but busy enough to not be able to shut down.

  7. The Telegraph have got it all upside-down: their 10p is the extra for the cheapest off-peak return versus a single. The marginal cost of an off-peak passenger on a train that the franchisee is mandated to operate is actually less than 10p – probably 1p (to the nearest p) for the increased fuel consumption, less than 1p for the ticket (unless he/she pays by credit card – in which case the cost is proportional to the difference between the single and return fare) – all other costs are fixed, So if it costs me 10p more for an off-peak return than a single it is highly sensible pricing because it motivates me to travel both directions off-peak and the train company gets more money than if I bought a peak-hour single, putting pressure on their resources, and walked home (it would take too long but in theory I could).

  8. Re; airlines. Isn’t part of the single/return price difference that since airlines have to to the passport screening they are liable/in trouble if someone overstays their visa. Selling a return means they can say to whichever govt. is complaining “They had a return ticket, how were we supposed to know they were going to stay?”

  9. Airlines aren’t generally liable for overstaying, but they do have to bear the costs of returning people they transported who were not entitled to enter in the first place. Besides, the single/return price effect holds within the Schengen zone, where 9 times out of 10 no one, not even the airline, looks at an ID document before you board and no one ever looks at it after you disembark.

Leave a Reply

Name and email are required. Your email address will not be published.

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>