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The Cost of Running Buses
Page 123
Page 124
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FIE overall flexibility of road transport is largely dependent dal its freedom from the restrictive influence of a specialized track and because of the large number of relatively small tional units which comprise a substantial proportion of the .ry. Particularly does this apply to road haulage. Although eat years there has been an increasing trend for financial Ts in most cases the operational unit has been wisely left existing size.
road passenger Side of the transport industry in this ry, however, is generally accepted as being dominated by operators. and on March 31 this year there were 63 such tors with fleets of 200 vehicles or more. But as with all of statistics even these few figures can be misleading if out of context. Also shown in the Annual Reports of raffic Commissioners for 1962/63 is the fact that out of a of 5,263 licensed operators in all areas 4,541 have less 10 vehicles. Moreover, of an overall increase of 14 tors as compared with the previous report covering the d up to March 31, 1962, there has been an increase of era tors with less than 10 vehicles and an actual decrease f. operators with fleets of 10 or more.
hough the reports from the several traffic areas comment ;dining revenues and passengers both in urban and rural record is also made of new entrants to the industry50 during the year in more than one area. Moreover, there variety of reasons for the authorization of the services ; provided by these new entrants. These include the t inevitable workers and schoolchildren's services but, in on, during the past year Traffic Commissioners have I new licences to cover p.s.v. services to provide transport d from football matches, bingo halls, late transport to :e stations, church services and agricultural shows. A recent innovation is a combined coach/hovercraft sion, whilst experimental free bus services to attract lers have been organized by local Chambers of ,Trade .al. areas.
:LOSE TOUCH
;ause many of these new entrants work and live in the in which they propose to operate the new service, they inderstandably be in close touch with the needs of their tial passengers. In other words, they will have access to I information as to traffic potentialities. They may, howbe in ignorance as to licensing procedure and the cost of ting whatever vehicle they have in mind. Because of the
d field in which it is still profitable to run a new p.s.v.
e it is more than ever necessary that any prospective tor should be in no doubt as to the actual expenditure to he is likely to be committed. Not only will he be faced competition from existing p.s.v. operators, but even more tna the ever-growing number of private motorists.
sling first with the statutory requirements governing the don of road passenger transport, it is first necessary to ; a public service vehicle. This is any motor vehicle used arrying passengers for hire or reward which either is ng passengers at separate fares or is not carrying passenet separate fares but is adapted to carry eight or more ngers.
with all motor vehicles used on the highway, public service vehicles are liable to payment of excise duty, the amount payable being in accordance with the rate for hackney carriages, varying according to seating capacity. Additionally, compulsory vehicle insurance is required as with other motor vehicle.
Public service vehicles for the purpose of passenger licences are divided into ,three classes: stage carriages, express carriages and contract carriages. A stage carriage is a public service vehicle carrying passengers at separate fares but not operating as an express carriage. When none of the separate fares is less than Is. (or such greater sum as may be prescribed) it is termed an express carriage. Contract carriages are vehicles which do not carry passengers at separate fares, a contract being expressed or implied for the use of the vehicle as a whole.
Whichever type of work the new entrant is intending to undertake, a public service vehicle licence must he held for the vehicle, whilst the driver (and conductor, if any) must hold a driver's or conductor's licence. Additionally, for stage and express carriages a road service -licence must be held for the particular service it is proposed to operate. But a road service licence is not required for contract carriage.
CERTIFICATE OF FITNESS
Before a public service licence can be granted a certificate of fitness must be in force in respect of the vehicle. These are issued by the certifying officers of the appropriate traffic areas. Applications for the licences already mentioned are made to the Traffic Commissioners of the area in which it is proposed to operate. Prior to applying for such licences guidance can be obtained from the appropriate traffic area headquarters as to the manner in which such applications shbuld be submitted.
The fee for a public service vehicle licence is £8 10s. with a validity of one year. The fee for a certificate of fitness is E5 10s. and may be valid for a period of one to seven years as the certifying officer may determine.
But whilst it is obviously necessary for a would-be operator of such vehicles to gain some knowledge of licensing procedure and seek the advice of a legal expert qualified in this particular field as to the presentation of the application, the cost Of operating the vehicle will subsequently be his sole responsibility. Any mistake be may have made in his original estimate— particularly as regards underestimating--will have to he rectified at his own expense. It is therefore vitally necessary that he should have acquainted himself with the principles of commercial vehicle operating costs and the details of such costs as applied to the vehicle he proposes to run.
As an indication of such likely costs, the following examples are given relative to a 44-seater single decker and a 60-seater double decker, both fitted with oil engine as • is virtually universal now with larger passenger vehicles. Unlike the goods vehicles, however, the specified sating capacity of a passenger vehicle is to some extent arbitrary, dependent upon individual operator's particular preferences. The particular capacities just stated are therefore nominal and indicative of the group rather than the actual capaCities.
It is an unfortunate factor with which many passenger operators have to contend that one or more of their vehicles might be put only to spasmodic use. This could be either as a duplicate over a relatively small mileage at morning and evening peaks, or alternatively—on contract carriage work—for a short season each year. For this reason the following castings are shown in respect of average weekly mileages of 600 (single shift), 1,200 (double shift) and only 200 when used as a spare vehicle.
Dealing first with the 44-seater single-decker it will be assumed that the combined cost of chassis and body is £5,372. Allowing for the appropriate proportion of licence fees according to their varying validity, the equivalent weekly cost of licences, including excise duty, is estimated to be 12s. 9d, This calculation is based on a 50-week year to allow for driver's holidays or vehicle overhaul.
SINGLE SHIFT BASIS Assuming in the first instance that the vehicle is operated on a single-shift basis only, the coif of wages to the employer is reckoned at £23 16s. 9d. This amount includes 'payment for a basic working. week to both driver and conductor, with additions for insurance contributions and holidays with pay. Rent and rates in respect of garaging the vehicle are estimated to be the equivalent of £1 6s. per week.
The-amount of premiums payable to provide comprehensive insurance is dependent on a basic amount plus additions relative to seating' capacity and initial cost. In this instance the resulting premium is £144 18s. or £2 17s. 11d, per week. At a nominal, rate of five per cent on the initial outlay, interest charges amount to £268 12s. per annum or ES 7s. 5d. per week.
The total for these five items of standing costs when working the single shift is £34 Os. 10d. Where the average weekly mileage is 600 the standing cost per mile becomes 13-62d. If, however, only occasional use is, made of this vehicle-say 200 miles a week-the standing cost per mile would be increased to 40.85d.
With oil fuel purchased in bulk at 4s. 2id. a gallon and a rate of consumption of 10 m.p.g, maintained, the fuel cost per mile is 5-03d. Lubricants are reckoned to cost 0.27d. and tyres 1.32d. per mile, assuming a -mileage life per set of 40,000. Maintenance is assessed at 3.47d. per mile whilst, with a vehicle life of 300,000, depreciation adds 3.70d. Per mile.. The amount to be written off as depreciation is obtained by first deducting the equivalent cost of the original set of tyres from the initial price of the vehicle with a 'further deduction in respect of the ultimate residual value.
This gives a total running cost of 13.79d. per mile, or 134 9s. 6d. a week, still assuming a weekly average of 600 miles. Similarly, the total operating cost, i.e. the addition of standing and running costs,. becomes. 27.41d. per mile, or £68 10s. 4d. per week
Where the vehicle was operating only 200 miles per week some adjustment would be needed to two of these five items of running costs. As maintenance includes washing and servicing in addition to major repairs, it will be customary to undertake some of the minor tasks, such as washing and greasing, on a weekly basis rather than by actual mileage. That being so, when expressed as a cost per mile, maintenance is increased to 5.79d. a mile at 200 miles a week. Similarly, because of the relatively low mileage, some additional allowance must' be made for obsolescence over and above the normal rate of depreciation. With this item therefore adjusted to 4.63d, per mile the total for the five items of running costs is 17-04d. per mile, or £14 4s. per week. The corresponding operating cost at 200 miles a week is 57.89d. per mile, or £48 4s. 10d. per week.
Where a double shift is worked wages are increased to £47 13s. 6d. per week, so giving a total standing cost of 157 17s. 7d. a week, or 11.58d. per mile at 1,200 miles per week. With running costs remaining the same the total operating cost is 25-37d. per mile or £126 16s. 7d. a week.
In the case of the 60-seater 'double-decker the initial outlay will be reckoned at 16,128. The equivalent weekly cost of licences will now be 15s. I id., whilst wage's for the double shift are again £47 13s. 6d. Rent and rates afe slightly, higher at £1 7s. 9d. a week; whilst vehicle insurance is increased to £3 5s. 5d. a week. Again, because of the increased initial outlay, interest charges become. the equivalent of £6 2s. 7d., so giving a total standing cost of £59 5s. 2d. per week, or 11.85d. per 'mile at 1,200 miles per week for the double shift: With a rate of consumption of 8 m.p.g. the fuel cost becomes 6-28d. per mile, whilst the cost of lubricants is increased to 0-29d. and tyres to 1.68d. per mile. Maintenance costs 3.93d, per mile and depreciation, calculated on the same basis as before, becomes 4.19d. per mile. The total running cost for this double-decker is then 16-37d. per mile,. or £81 17s. 'per week; and correspondingly the total operating costs 28.22d. per
mile, or £141 2s. 2d.per week, . .
If this double-decker had to stand by for peak hour duplications only, or other spasrbOdic work, with a weekly 'average of 200 miles, the following adjustments to,costs will be necessary. Wages will, be reduced to £23 16s. 9d., i.e. single shift, giving a 'total standing cost of £35-.8s. 5d. per week, or 42.5Id. per mile. Making increases to maintenance and depreciation on the same basis as before, the total running costs become 19-63d. per mile, or £16 7s. 2d. per week. Correspondingly, when averaging only 200 miles per, week. with this 60-seater double-decker, the total operating cost is 62.14d. per mile, or £51 15s. 7d. per week