The Wiki Man

Rory Sutherland: How to improve journey times without HS2

Just give me £500,000 and a roomful of software coders

9 November 2013

9:00 AM

9 November 2013

9:00 AM

I am still waiting for someone to refute my argument that it would be possible to reduce the journey time between London and Manchester or Birmingham for many rail passengers by between 20 and 40 minutes — and to improve effective capacity — at about 0.001 per cent of the cost of HS2. This would be done simply using software, not hardware.

Last Thursday I travelled to Manchester to give a talk in the afternoon. The journeys up and back were flawless. But they did take 40 minutes longer than necessary — in both directions. Why?

A month before, once I knew that I had to travel to Manchester, I did what every sane person would do. I booked an ‘Advance’ ticket there and back on specified trains. This means you can travel up and back in first class for about a quarter of the £400 it costs for a fully flexible return — and for less than it costs to buy an off-peak second-class return.


The risk is that if you miss your train, you have to pay the full price for a replacement ticket and all the money you have paid for the Advance ticket is forfeited. This prospect understandably frightens my inner Calvinist. So unless you live within walking distance, you need to set off insanely early in order to leave a large margin for error. I duly arrived 48 minutes before my train was due to leave. This meant two Virgin trains to Manchester left half-empty before I was allowed to board the 10.20 a.m. train I had booked. I spent the intervening time unproductively mooching around Euston.

Now, with a roomful of coders and £500,000 it would be perfectly possible to create a revised pricing system and a mobile phone app which would allow anyone to switch to an earlier train, capacity permitting. You would simply arrive, click a button marked ‘I’m here’ on your phone (or on a touch-screen terminal) and wait to be offered any available seat on an earlier departure. Perhaps you would pay £5 to £10 for the switch.

This would actually be good yield-management practice. You always want passengers to switch to an earlier train (or flight) if there is spare capacity, since seats are a perishable good: by occupying an earlier seat which is definitely empty, I free the train company to resell my later seat to someone else. Which is why easyJet already offers this option on its flights. (I don’t want to bore you with the intricacies of yield management but, as you have probably guessed, this argument does not apply in reverse. You should not allow people to switch easily to later trains.)

So with £500,000 spent on software, you have door-to-door journey times reduced by 20-40 minutes, wasted seat inventory reduced, less overcrowding on trains, not to mention the people of Buckinghamshire dancing in the streets. What’s not to like?

There is only one possible objection. By making Advance tickets more flexible and hence more attractive, you discourage people from buying full-fare tickets. This problem was identified in the 19th century by the French economist Jules Dupuit, who inferred that, although it would cost little to add a roof to third-class railway carriages, it was in the interests of railway companies to make third class disproportionately unpleasant in order to encourage all but the most destitute to pay the extra money for a second-class ticket.

I don’t know how much Virgin Trains would lose through this ‘revenue abstraction’ if they were to make the Advance ticket slightly more flexible than before. But I am sure that if you were to offer Richard Branson £1 billion and a new balloon he might be encouraged to overlook the problem.

Got something to add? Join the discussion and comment below.

Rory Sutherland is vice-chairman of Ogilvy Group UK.

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Show comments
  • nick

    Nobody arrives at the station 48 minutes before their train leaves so you could save 40 minutes by just leaving your start destination 40 minutes later. Unless you have a very specific and limited ticket you can travel on other trains at other times as long as they have the same price. The reason why peak tickets are so expensive is due to lack of capacity to run more trains.

    So if you missed the first off peak train you could catch the next one. In any case your suggestion would not reduce the actual train journey time nor would it do anything whatsoever to increase capacity, especially on overcrowded commuter trains, which is the main reason why HS2 is needed.

    • rorysutherland

      The trains into Euston are the least crowded of any London station other than HS1 into St Pancras.

      • nick

        the london midland services are seriously overcrowded. by removing some services to another line you gain more capacity for commuter trains and you get seats freed up from those now using another line. hs2 adds another two tracks between London and Birmingham so more tracks means more capacity it is as simple as that

    • rorysutherland

      I come from Sevenoaks in Kent. If I don’t allow a 45 minute buffer, any cock up on my journey can render my ticket worthless. Besides who cares about the time on the bloody train – it’s the door-to-door time that matters.

      • nick

        If you currently allow a 45 minute buffer and intend to do the same with hs2 then the hs2 part of the journey will be faster making the end to end journey faster then it is now. If they implemented your suggestion now then using your scenario this would save you 40 minutes, but this would then also apply to hs2. The part of the journey which is on hs2 will be 40% faster then it is now !

        • Quentin Vole

          If you want a job as an HS2 shill, you really need to keep up with the argument (difficult, I know, as the HS2 justification changes every few weeks). Time saving through faster journeys was the original cost-justification, but this was soon dropped as people pointed out that train journeys have not been dead time since the mobile phone was invented.

          This week’s justification is that we’re running out of capacity, but is based on rigged data (Euston is the least busy London terminus) and simplistic assumptions (that recent traffic growth will continue unabated for decades).

          • nick

            ah ritual abuse the first sign of completely losing the argument as you have. The main reason for hs2 has always been capacity as can be shown by reading the original and subsequent reports and interviews with Adonis etc.

          • HS2PoisonedChalice

            Judging by the up and down arrows the Vole argument does not appear to have lost at all.

    • rtj1211

      You are more likely to leave a margin of safety if your ticket is non-transferable and the cost of a new single is 3 times what you paid for a return. You might be a millionaire but most aren’t.

      • nick

        I think over 40 minutes is quite enough time and if you have a cheaper off peak ticket this can usually be used on other services at the same price.

  • masabaer

    Rory,

    Take a look at this proposal which nixes the idea that we need to go faster in the first place.

    http://bit.ly/SmootherTransport

    The current situation in the UK for (each of) ticket prices, capacity utilisation of rolling stock and congestion management on the UK rail network is both wasteful and delay inducing.

    A far better way to run this railroad would be to allow prices to vary continuously and to also sell tickets via national capacity exchanges, where options, futures and forwards on seats could be traded transparently.

    • nick

      you are still going to need more capacity however

    • rtj1211

      OH, so you want Goldmans to buy up all the train tickets and then profiteer by selling them on to the public, controlling the pricing without either running the railroad or bearing any responsibility for its performance, eh??

      What an absolutely rubbish concept: you lot always say that ‘State ownership’ leads to poor service. Well, how about ticket ownership by Goldmans doing the same?? The operating company can’t control how many tickets are bought and sold because some speculator has warped the market.

      We all know that commodities trading has done that for oil, food etc etc. It’s just that far right dogmatists won’t tell the truth.

      Nothing wrong with exchanges, but options, futures and forwards must be specifically banned.

      • masabaer

        @rjt1211

        Funny, because commodity markets did wonders for farming and food distribution. In those cases the “speculators” do exactly what you are saying is bad.

        Forwards, Futures and Options changed airlines, long distance coaches and hotel bookings.

        Do you know what futures and forwards did for farming? They gave the producers a way to guarantee some kind of payment for future work not yet delivered. The same analogy can be made for providers of transport – who have poor information on demand, but certain fixed costs or perishables they are producing.

  • Phil Reed

    If only the UK’s rail capacity issues could be cured by an app! Yield management can’t work for rail operators the same as it does for airlines for one simple reason: walk-on. You can’t just turn up at an airport with any old ticket and get on a plane. Also, there are no mechanisms, currently, to check how many people are on a particular train, so you don’t know what free capacity is available. OK, we could introduce pre-boarding ticket checks, but that will eat into any journey time savings – and cause untold chaos at Waterloo, Euston etc.

    The second problem with the ‘solution’ is that it ignores the fundamental problem of there being insufficient capacity on the network to run more trains. If passenger numbers continue to increase, any yield management programmes will be useless. Shuffling chairs on the Titanic springs to mind.

    If we are to avoid the rail network falling over in 10 to 20 years, there are only two viable solutions: substantially increase capacity (ie more lines and more trains) or significantly reduce passenger numbers (ie by increasing prices substantially or making the journeys intolerable). Which do we want?

    • masabaer

      Interesting how intercity coaches manage to do this in that case then. Double Decker Trains can help and by digging into the ground under existing bridges and tunnels to lower the rail track, a solution could be found to enable such rolling stock to pass, no?

      • Phil Reed

        I’m not a rail engineer (or even work in the industry), but my understanding is that it’s not just the height of the bridges that’s a problem, it’s things like loading gauges. And it would cost billions, as well as years of disruption to existing services. Hard to imagine that not having any opposition!

        • masabaer

          Better to do that than build a pointless boondoggle.

          • andrewbowden

            Changing to a loading guage on key lines that is suitable for double decker trains would cost billions and cause huge amounts of disruption. tracks would need to be moved, platforms shifted, bridges raised. tunnels widened.

            It’s the reason Crossrail in London isn’t being built to be double deck compatible. Whilst the new central section could have been, converting the existing track on each side would have been a complete nightmare.

            Double decker trains are great but we built our railway infrastructure in a Victorian era where they weren’t anticipated – and later the investment wasn’t made to bring them up to the same standards commonly used in continental Europe.

            Improving our mainlines to run on the continental loading gauge would be wonderful in principle. In practise it’s simply never going to happen.

          • Quentin Vole

            Luckily we already have a main line built to continental (‘Berne’) loading gauge running from London to Manchester and Sheffield, called the Great Central. Unluckily, Beeching closed it in the 60s. But most of the trackbed still exists and it could be reopened for a fraction of the cost of HS2.

            Of course, it wouldn’t support 400 kph running, depriving our politicians of bragging rights at euro conclaves. But it must be a better investment than HS2.

          • andrewbowden

            Ah, the Great Central. Being built to the continental loading gauge must have been about the only thing they actually did right on that line. Indeed the reasons for closure are pretty much the reasons why it will never re-open. It was a basket case. Certainly in the context of a HS2 alternative, it is next to useless

            For passenger services it doesn’t serve – or have any hope in serving – some of our biggest cities. Leeds, Birmingham, Liverpool completely left out. Manchester could be served, but only at great cost by a slower route than the present one. Re-opening it would be great for providing extra capacity on the Midland Mainline, but there’s no real need too. Capacity on that line is not a massive problem, unlike the East and West Coast Mainlines.

            And for freight, the West Midlands again proves a blocker – this being one of the key areas for freight traffic. There was a suggestion towards the end of the British Rail era about re-opening the GC for freight traffic, but after analysis, it simply didn’t make sense.

            There’s other problems. Rugby would suffer mightily as much of the line there has been lost to redevelopment.

            But the real massive problem comes near Aylesbury. The line here connected with the lines Chiltern run today. Trains using a re-opened Great Central therefore hit a problem. The days when the Chiltern lines were a sleepy backwater are long gone – this is a busy line, hemmed in with not much chance of extending. And at the end is a tiny station that’s got nowhere to expand to.

            So from Aylesbury you pretty much need to built a new route into London – in other words you need to build that chunk of HS2. You might build it at lower speeds, but that won’t save you that much money, nor will it please the people in the Chilterns who still won’t get their way.

            Many people agree that the Great Central – if it hadn’t been closed – would have provided a useful diversionary route, or alternative for some traffic. But ultimately it was a bonkers line that didn’t serve many useful places. In a modern era, its loading gauge is about the only thing it’s got going for it.

            Of course there is a use for some of the Great Central – the proposed HS2 route does follow some of its old trackbed.

          • Quentin Vole

            You HS2 nuts need to sort out your arguments. Yes, of course reopening GCML would not be trivial and would cause disruption. It’s just that it would be an order of magnitude less in time, cost and pain than building HS2. Since this week’s argument in support of HS2 is capacity (based on skewed data and ludicrous assumptions of future growth, but let’s pretend it’s reasonable just for the sake of argument), GCML would address this just as effectively as HS2 can do. But no doubt the argument for HS2 will just be changed once more.

            My prediction: HS2 will be built as far as Birmingham – politicians would lose too much face to cancel it now. It will then be quietly dropped, leaving us with most of the cost and negligible benefits. Future generations of economists will be taught its history as the biggest boondoggle since the groundnut project.

          • rtj1211

            YOu know better than the professional engineers who did the detailed consultancy, do you??

            Present the figures then.

          • Quentin Vole

            The first question any consultant tasked with producing a report will ask is: “what would you like the conclusion to be?”

            The fact that so many consultants have been used in different attempts to justify HS2 should tell the unbiased observer all they need to know.

          • nick

            funny that they all conclude that capacity is the main reason for hs2 though. presumably the only consultants you would agree with would be the ones who said hs2 was not needed. I see no reason to doubt Atkins or KPMG or the BCC or Network Rail.

          • rorysutherland

            We are certainly less self-interested than the engineers who did the consultancy work. “Never ask your barber if you need a haircut”.

          • nick

            so never ask a software engineer to do consulting work on a software project. ask a mechanical engineer. or your barber.
            This is tongue in cheek, but should a consultant not be from the area of expertise from which that advice is sought ? Would you consult out of your knowledge comfort zone ?

          • andrewbowden

            Actually the argument for HS2 has always had a strong capacity basis. It was designed to provide capacity relief on the West Coast Mainline. Unfortunately capacity isn’t sexy to politicians, hence they initially chose to concentrate on what was – speed. (So if the argument is capacity, why make a new line high speed? Well why not? the big cost comes from building a new line in the first place – a high speed line is basically just track when all is said and done.)

            The West Coast is increasingly full. Network Rail have recently turned down requests to run new passenger services to Blackpool and Shrewsbury for that reason.

            Great Central would not help that capacity problem for all the reasons I outlined above.

            The big user of the WCML is passenger services. With no connection for Birmingham, you can’t divert the Intercity services between London and Birmingham down a re-opened Great Central. Nor intercity services from London to Holyhead or Liverpool. Great Central had links to Manchester, but not very good links. They weren’t particularly direct and re-opening and making them a viable replacement for the existing lines would be extremely difficult. And finally Great Central would be of limited use for diverting Scotland bound services – you’d probably end up pushing them down the Settle to Carlisle Line which would need substantial upgrades to cope because that’s actually quite a busy line. It’s busy because it takes a lot of freight off the West Coast Mainline.

            So that’s no diversion options for Virgin Trains. London Midland is mostly a commuter service so no hope there either.

            Freight? Well much of that goes via the West Midlands because it’s an important freight centre. No doubt some trains could be re-routed down Great Central but not enough to release any significant capacity for the WCML. So no additional commuter trains could be run between London and Milton Keynes.

            There’s no doubt at all that re-opening Great Central would create a lot of capacity. But it it doesn’t create it where it’s desperately needed.

          • nick

            HS2 was based upon passenger growth of 2.5%. The actual growth has been 5%. Growth has doubled over the last 15 years. So no “skewed data an ludicrous assumptions etc” as you erroneously claim. The main need for hs2 as it has been from day one is capacity.

          • John Burns

            The Great Central was a directly north line taking in Rugby-Leicester-Nottingham-Sheffield and Leeds. Substantial locations I must say. It was designed to be “fast” and direct. It can also be used for freight and passengers, and alleviate the WCML & ECML. Only 14 miles of it are built on. These can be CPO’d and/or the line diverted or put in tunnels.
            The Great Central was closed down because of silly Beeching and that crook Marples.

          • Jackthesmilingblack

            km/h (or km/hr) is the abbreviation you want. kph? Where`s the metre, Muppet? Check your car speedo if you doubt the veracity of what I say.

          • nick

            HS2 provides more capacity, faster journey times, wider economic benefits and much less disruption to exisitng services. the existing lines also go right throuh the middle of towns, cities and villages. Did you notice the reaction to hs2 through west London before tunnels were agree ? Yet this part of the line runs alongside the existing route

          • rtj1211

            not if it costs as much and delivers more disruption for many years.

      • nick

        hugely expensive and hugely disruptive

    • John

      Currently software can improve the long haul services.

      • nick

        but not enough to meet demand.funnily enough hs2 will use the latest software

        • rorysutherland

          Yes, fine, but do the damned software first. And put wifi on all UK trains first. Do the simple, cheap stuff first. Then you can decide what needs to be done next.

          • nick

            wifi is being implemented but will not help capacity. apart from software upgrades or adjustmenst many other schemes are being implemented to improve speed and capacity. £37b is being spent over the next 5 years on the existing lines. HS2 will not be available for at least ten years. We cannot do as we have done previously, which is to wait until lack of capacity is reducing connectivity and increasing delays. We have to have a plan, of which all of the above form a part

          • rorysutherland

            One idea to improve capacity is to reintroduce Third Class standing-only carriages (with lower fares) on peak commuter trains for journeys under 40 minutes. This means that 23 year olds can save money and space by standing up, just as I did on the tube in my 20s.

    • rorysutherland

      Why do you need walk-up fares for journeys to Manchester? You need the freedom of a walk-up fare for a commuter or local rail service, but who the hell decides to undertake a 300 mile journey on a whim?

      The German Railways experimented with a system where all journeys would need to be prebooked. It was, in principle, a good idea but was poorly executed and introduced too precipitously.

      I also dispute the idea that more (or longer) trains could not be run on the network. It is possible for trains to run much closer together if you abandon the current signalling systems.

      • Phil Reed

        Just because you get a Manchester train at Euston doesn’t mean you’re going all the way to Manchester. Trains stop at stations. People do turn up and buy a ticket for those services, not just commuter.

        Yes, in theory you could run more trains on any line, but increased utilisation inevitably leads to more issues of service perturbations and, consequently, a much less reliable network.

        • John

          There are express services from London to Liverpool/Manchester. The very recent Atkins report stated that times of 1hr 46min & 1hr 43min are achievable from London to Liverpool and Manchester on the WCML and ECML. It that slow? No one in the right mind would think so.

          • nick

            The only way of achieving those times would be to remove most if not all of the slower services thereby massively reducing local services. Explain in as few words as possible how this can actually be achieved without new lines

      • mikewaller

        Cannot help but feel that the last paragraph in the main article is a cop out. The reasoning concerning the open-top third class seems unchallangeable, so who in your world would be so daft as to pay out the £400 when for £100 + a small transfer fee, they could take their chances on three trains?

        • rorysutherland

          You still couldn’t travel back on a later train, and you would not be allowed to travel in a train more than, say, 40 mins earlier. So not wholly flexible.

  • John

    Pendolinos go 125mph max only on certain stretches. If they implement in-cab signalling the trains can go 140mph. Get local and regional rail off the WCML & ECML, by improving greatly local and regional rail (where the need is) and the ECML and WCML become 140mph expressways.
    Read the Atkins report. There is no need for HS2. Currently it will be a sluice for wealth into the capital.

    • nick

      You keep repeating this over and over again.I suggest that your read all of the Atkins reports as they clearly do NOT state that there is no need for HS2. The conclusion is that hs2 offers a better alternative.

      You keep stating that we should or can “get local and regional rail off the WCML and ECML” etc etc but you have not ONCE explained how you can do this. You are of course correct that if we removed some trains that intercity services could be faster. Since hs2 offers the separation of services that you agree with then you should support hs2 and not be against it.

      • John

        The Atkins report gives times from London to Liverpool and Manchester as 1hr 43min & 1hr 46min. Do you think that is slow?

        This super-expensive HS2 project only services a sliver of traffic. The £50bn can be spent on giving Liverpool the metro that was planned (work was started and abandoned on some large sections) in the 1970s. Tunnels under Birmingham and Leeds centre’s can join up the commuter lines creating needed crossrails which also act as metros. £50bn would also give lots of change doing all this. The need is local and regional rail not another Concorde.

        HS2 only benefits London. Many even in the south east do not want it.

        • nick

          You still have not explained how you are going to remove all non-intercity trains from the ecml and the wcml without building new lines. How much are the Birmingham and Leeds tunnels going to cost ? As I said the best solution is to build a new high speed line which would remove the non-stop intercity services from the existing lines leaving more room on those existing lines for commuter and freight trains as well as regional express trains.

          Also, as HS2 runs to Birmingham, Leeds, Manchester, Sheffield and onward via existing lines to Liverpool New,castle Glasgow and Edinburgh etc, I am not clear how this can be seen in any way to “only benefit London” !

          There are not any similarities to Concorde which in any case was a technological marvel. HS2 will use existing technology, will only be slighty faster then existing hsr and in capacity terms is more of a 747 or Airbus 380. And also unlike Concorde, premium fares are not planned.

  • Tom

    While I agree with you in so many ways and this is a wonderful piece, the reality is that you are arguing against good business practice.

    The advanced ticket is a product of intentional discomfort to maximize yields using first order price differential.

    If they were to make it a better and “more fair” product then a significant number of people who currently hate the stress caused by the fixed time, would not be forking out more for flexible tickets.

    If the numbers of people that would do that are so small as to not affect the revenue so much, then clearly not really improved the journey for many people.

    Either way, the 40 mins of time saved, won’t be applicable to a large number of people on the train who are able to board any train.

    • nick

      I have pointed out just now in reply to him that if this system were implemented now (ie travel on any train with cheap seats for last minute bookers) whilst this might save him his 40 mins now, the system would then apply when hs2 was built so the journey would still be 40% faster.however cheap seats can only be offered where there is capacity, which as hs2 provides guge capacity, will make it more likely that cheaper seats can be offered. the current system prices people off peak hour services due to lack of capacity for any more trains on the wcml south of rugby

    • rorysutherland

      This is Dupuit’s point. But I buy Advance tickets even when I am not paying for my trip – and even when a client, not my employer, is paying for my trip. I do this for simple reasons of common sense. I suspect most people who routinely pay full fare are employees of monolithic organisations such as the BBC, the civil service, etc.

  • nick

    The main reason for hs2 is capacity as it has been from day one. Anyone denying this fact should read the original and subsequent Atkins reports and statements by Lord Adonis.

  • Jackthesmilingblack

    While you still agonizing whether or not to build the first leg of a high-speed rail link, Vietnam will have theirs up and running. Get with the programme Britisher pals. Be there or be square.

  • Jackthesmilingblack

    While you still agonizing whether or not to build the first leg of a high-speed rail link, Vietnam will have theirs up and running. Get with the programme Britisher pals. Be there or be square.

    • rorysutherland

      If you live in Japan, as I seem to remember, you might be able to help me answer a question. I was told that the Shinkansen trains only allow you to travel by pre-booking a reserved seat. This seems a bit odd to me – what is the point of having fast trains running every five minutes from Tokyo to Osaka if you have to wait around at the station for a pre-ordained train? Or is there an easy system of changing your ticket?

      • Jackthesmilingblack

        “I was told that the Shinkansen trains only allow you to travel by pre-booking a reserved seat.”
        You were misinformed.

  • Cumberland

    Reintroduce/build slow lines,and extended loops to get slow trains off the fast lines out of the way of the faster trains..

  • Ricky Strong

    The one thing I notice quite often is the sheer number of first class carriages to standard class. I can honestly say I have never seen a first class carriage full, even when all other carriages are packed like sardines.

    • rorysutherland

      I went in First Class last time – I was at risk of suffering agoraphobia.

    • post_x_it

      I am an infrequent rail traveller so I don’t know if the following is common, but I forked out for first class once from North Wales to London. Initially it was not very full, but at Chester the conductor suddenly announced that my carriage had been “declassified”, at which point it became rammed full of standard ticket holders, including the aisles. I was allowed to keep my seat, but there was no offer of compensation for the loss of comfort and personal space. I felt rather ripped off.

  • e2toe4

    I don’t know much about High speed rail but I know a bit about the continuing cascade of calamity that the Edinburgh Tram Project was, still is, and even after it starts running will continue to be..another big headline, trophy project where everyone involved constantly talks with blithe authority about what the world will be like in 20, 30 or more years

    Like the grown ups in 1912 looking say 35 years ahead, or the grown ups in 1985 in the media, music and whatever looking 35 years ahead.

    So I am more attracted to the approach advocated by Rory Sutherland of trying small stuff first at least… and to the person banging on about ‘walk ups’ spoiling the software macros; most stations are now getting barriered and even before they were I can’t remember the time anyone I know, family, friends, business acquaintances- EVER ‘walked up’ and stepped on a train ready to pay on board.

    That seemed like a bit of a manufactured argument.

  • Mark McIntyre

    NO2 HS2 – turn the clocks forward !

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