24 June 2008

$13846 per passenger

According to the NZ Herald that's what Auckland ratepayers (and taxpayers) have already paid for each person expected to use the new trial daily Helensville to Auckland commuter train service. It will be an extension of a single service and carry 65 passengers a day, in addition to those it will pick up on the Waitakere to Auckland section (which would have run anyway).

However, that without a single passenger having been moved, that was just to build the platforms to take the trains. It will be another $400,000 a year in operating costs for the service, around $26 per day per commuter. So you better hope the fare would be that, but you can be sure it wont be. ARC's leftwing Chairman Mike Lee said "he would be most surprised if the Helensville service did not follow the trend of every other recent improvement to the rail network, in becoming over-subscribed very quickly." Well, if you give people something they have only had to pay part of the costs for, that's quite possible. However if you can charge the passengers $35 a day for the privilege (which would cover opex and recover the capital costs), then it will make sense.


Anonymous said...

Well, Liberty Scott, there are some things that need to be cleared up.

First of all, while passengers aren't going to be paying $26 a day; they will be paying $9.10 in each direction (if they are coming from Helensville), with the natural discounts should they use ten trips, monthlies and so on. Quite a good proportion of the operating costs, considering that there is only 35% cost recovery at the present.

Also, the platforms that have been constructed at Huapai and Waimauku are planned to be there on a permanent basis; the plan is already that Huapai would get a permanent service after electrification has occurred. So, while it may seem like $14k of capital costs per passenger, should the trial succeed, wouldn't your capital costs be spread over more passengers?

Of course, Liberty Scott, also remember that in 2003, the Pukekohe service was not attracting that many passengers. Today, it numbers at least a hundred and justifies four return peak services, as well as two return off-peak services per day; both of which are due to increase with the July timetable.

Finally, if the service gets 90 passengers (which seems possible), the operating costs would be covered. Would you be happy then?

Libertyscott said...

Yes, on a marginal cost basis it is better than most, although yes the capex for the platforms should be borrowed and paid back over a depreciated period.

I'm happy if Auckland rail can fully recover operating costs, like buses largely did.

Anonymous said...

"I'm happy if Auckland rail can fully recover operating costs, like buses largely did."

Actually, buses don't all recover costs - remember that more than 50% of our routes are subsidised, and the non-subsidised ones are largely the old "tram-era" legacy routes, where the development is suited for public transit.

I suppose the main thing that rail needs to do over the next few years is ensure that it gets a more efficient form of fare collection (thereby reducing costs), and try to encourage more people to use off-peak services. Most peak services I am confident recover their operating costs.