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What’s next for public transport operators?

Craig Strudley Director 22/09/2020

Following today’s announcement, the ‘stay at home’ message for office workers is back. For public transport operators, and many other industries, their worst fears have been realised.

Despite hoping for something more dramatic, many public transport operators anticipated that we would only see a gradual increase in passenger numbers...

Alongside a raft of new announcements by the PM at lunchtime today, the message will extinguish any hopes of ‘getting back to normal’ and for transport operators specifically, any expected increase in public transport usage over the coming weeks and months.

As we entered July, the message had been less strict but there was seemingly still a reluctance to endorse the use of any form of communal transport. At the time, our team of travel and transport experts at Savanta asked: “Should the Message Change?” and the answer was a resounding yes!

From 1st August, we had entered a new phase as Boris Johnson gave employers the discretion to bring back staff to safe work environments. Schools re-opened from September and the message regarding public transport did change. Suddenly, we were expected to ignore everything we had been previously been told; despite anticipated higher passenger numbers, we’d all be fine on the bus or train.

However, today’s announcements, and the change in tone, will once again limit and deter public transport usage, and with it, the transport operators hopes that we get back to the old commuting routine.

Even in recent weeks, despite hoping for something more dramatic, many public transport operators anticipated that we would only see a gradual increase in passenger numbers. All the evidence so far showed this to be the case. There have clearly been regional variations but, whereas road traffic numbers were almost back to pre-Covid levels, trains, buses and other forms of public transport were, on average, reporting passenger numbers at 30% of historical figures. Our own figures from the second week in September back up these reports:

  • 1 in 4 of us have used public transport in the previous 7 days
  • This represents just 40% of all those who stated they regularly used public transport pre-Covid   

So, why was this? Was the message about safety simply not cutting through? Or was it something else?

Not everything is under the control of operators

This seems obvious but it’s worth stating the facts. For instance, although home working has declined from a peak of nearly 40% during the height of lockdown, recent ONS figures suggest that 1 in 5 employees are still working from home every day. Many businesses simply do not see the need to rush their employees back into the office (and less so now). There is clear evidence that many of us enjoy our home offices and firms have taken the opportunity to save money on rent by cutting down on office space.

In addition, ONS have also reported that more than 10% of the workforce are still on furlough in September and it’s been hard to escape the daily news reports of redundancies. Not all those made redundant, on furlough or working from home would previously have been public transport users; however, it is clear that there are millions who, for the foreseeable future, will not be commuting to work in the way they once did.

Though it’s hard to see what public transport operators can do to tackle this issue directly, we do know that there is still work to be done, even when things finally open up again. One potential step is to conduct research with business leaders in the regions in which they operate. What are their plans in the medium to long term? Understanding topics such as flexible start times and working from home policies could be invaluable when making plans for the future.

Control the controllables

Accepting that operators will have a difficult time influencing some of the macro trends that affect travel, it is absolutely essential that they maximise public transport usage amongst those who are regularly making journeys – whether that be for commuting, leisure or business. Here the major consideration is simply; is it safe?

Savanta’s Covid-19 tracker also posed this question:

With only slightly less than 4 in 10 agreeing with this statement, it appears that operators will still have a huge job on their hands to persuade us that public transport is safe.

There is some hope when you break down the results by recent experience:

How much do you agree or disagree with the following statement?

“Public transport is just as safe as other places such as pubs, restaurants and shops”

It is clear that the majority of those who have actually used public transport in recent times do actually feel safe. The fear and mistrust are driven by people who have not yet experienced the reality. Operators have undeniably been working hard to make travel safe and to publicise what they have done; however, it appears there is no substitute for experience.

One solution would be to incentivise people to get back on the train, bus or tube when the time comes. To test this theory, we also asked our national representative sample of 2,000 about one potential idea:

Transport Focus, the independent watchdog for transport users, has already started to push for a ‘Head Out to Help Out’ scheme. This would seem a sensible move and our data does show some support. Of course, a lot would depend on the details of the incentives and how they are positioned, however, one drawback appears that there is much stronger appeal amongst those who are already using public transport. Could such a scheme actually end up costing money by giving discounts to those who already feel secure, whilst having minimal effect on the actual target group?

It would seem swift market research is required before rushing into what could potentially be an expensive failure, to be funded by taxpayers for years to come.

Back-to-school = back-to-work?

As mentioned above, there was hope, particularly in Government circles, that back-to-school would have a very positive effect on the economy. Parents would suddenly be free to return to their regular place of work, thus having a knock-on effect on local economies – public transport operators would, of course, also benefit. As it stands (mid-September), the jury is still out. There has certainly not been a huge and immediate impact, although some routes and services are reputably busier. Whilst progress may have been made in recent weeks, this will now be undone with the latest lock-down announcements. We also asked a direct question on this in our tracker:

The first thing to note is that 65% of respondents reported that they either had no children of school age or were not currently working i.e. are unemployed, furloughed, retired or students. Therefore, for the majority, the return of schools was never going to make a real difference to their travel behaviour. Of the remainder, 4 in 10 did report that the schools being back would mean they would be travelling to their place of work from now on, but this only equates to 14% of the population.

And, of course, travelling to work does not necessarily mean travelling to work by public transport. Our data shows that just 1 in 5 of ‘the 14%’ usually travel to work in this way. Of course, our figures do not take in to account other factors such as journeys undertaken by school children themselves or the potential effects on business or leisure travel, however, it is not hard to reach the conclusion that the return to school was never going to have a dramatic effect on the public transport passenger levels hoped for.

In conclusion, what should public transport operators be doing?

The first inescapable truth is that the potential market for public transport operators has been considerably reduced and will remain that way for some time, especially with the latest work from home message. The ‘for some time’ phrase is crucial here.

In order to properly plan, operators must try and get a handle on what businesses in their areas of operation are planning and when.

Are city centre locations closing permanently? Will start times be flexible? Is working from home here for good? Is business travel a thing of the past? We may not like the answers, but this insight is required to move public transport businesses forward in a sustainable way.

Secondly, if the number of people travelling to work is down for good, it means our target market is also down and so we must fight for every passenger, with the car being the biggest threat. As we have seen, this means two things:

  1. Messaging and communication must be spot on. We really need to understand our target audience and their motivations. Operators have done so much to make us safe, but are they getting their actions across to the right audience in the optimum way?
  2. Incentives may well be necessary. We do not have months to develop and test the optimum scheme, however, it is critical that potential solutions are researched both qualitatively and quantitatively with target audiences to avoid a very expensive mistake.

Speak to Savanta

It is this understanding of both businesses and consumers where Savanta come in. We take a consultative approach to market research with commercial focus driving everything we do. We have many years of experiences working in the travel and transport sector. As such, we have the necessary expertise in your industry and believe we are the perfect partner in these uncertain times.

To find out more please get in touch with one of the team at [email protected]