TfGM Bus franchising

[WatcherZero]

Should be pretty steady apart from changes caused by roadworks and such until 2025 when rollout is complete and they are planning a recast.

 

[WatcherZero]

Bus industry as a whole hasnt recovered from the number of drivers that transferred to Trucking when Co-vid and Brexit caused a shortage forcing wages up to more than double what you could earn as a bus driver.

The pharmaceutical company I worked for lost loads of warehouse staff who went to become supermarket delivery drivers for a £10,000 per year increase because the former delivery drivers also went over to trucking for a £20,000 salary boost.

 

[johncrossley]

The evidence so far is that franchised operations have suffered less from staff shortages. London and Greater Manchester have both gone to great effort to find staff from outside their areas, whereas deregulated bus operators simply make cuts and/or have cancellations because of the lack of financial sanctions.

 

[Goldfish62]

Bus industry as a whole hasnt recovered from the number of drivers that transferred to Trucking when Co-vid and Brexit caused a shortage forcing wages up to more than double what you could earn as a bus driver.

The situation generally though very tight is a lot better than it was 18 months ago. There have been some substantial pay rises (not before time) and some of those who went lorry driving have found that the grass isn't always greener.

 

[TheGrandWazoo]

Bus industry as a whole hasnt recovered from the number of drivers that transferred to Trucking when Co-vid and Brexit caused a shortage forcing wages up to more than double what you could earn as a bus driver.

The pharmaceutical company I worked for lost loads of warehouse staff who went to become supermarket delivery drivers for a £10,000 per year increase because the former delivery drivers also went over to trucking for a £20,000 salary boost.

The situation generally though very tight is a lot better than it was 18 months ago. There have been some substantial pay rises (not before time) and some of those who went lorry driving have found that the grass isn't always greener.

Sadly, part of that has been enabled through the widening of headways to reduce headcounts. Someone I know has just left First - gets paid as much for driving a rigid tanker, doesn't work nights or Sundays, and only 1 in 3 Saturdays.

Of course, there are very definite variations even in local labour markets. Bristol is a tricky area simply because of the disproportionate number of retail distribution centres around Avonmouth/Almondsbury. Less so in South London, for example!

The evidence so far is that franchised operations have suffered less from staff shortages. London and Greater Manchester have both gone to great effort to find staff from outside their areas, whereas deregulated bus operators simply make cuts and/or have cancellations because of the lack of financial sanctions.

Based on Greater Manchester having been running for NINE days... Talk about interpreting information to fit your own views

The reason why deregulated operators make cuts/cancellations isn't because of the lack of financial sanctions. It's because they have the commercial exposure on costs vs. farebox revenue. That doesn't happen in London, and as every operator is in the same boat, staff costs are higher but that is simply reflected in the price charged to TfL.

 

[Megafuss]

The evidence so far is that franchised operations have suffered less from staff shortages. London and Greater Manchester have both gone to great effort to find staff from outside their areas, whereas deregulated bus operators simply make cuts and/or have cancellations because of the lack of financial sanctions.

Oh come off it. Just because you don't see the problem doesn't mean there isn't one. There may be a very big problem in Manchester when all the Go Ahead drivers return home

 

[markymark2000]

The evidence so far is that franchised operations have suffered less from staff shortages. London and Greater Manchester have both gone to great effort to find staff from outside their areas, whereas deregulated bus operators simply make cuts and/or have cancellations because of the lack of financial sanctions.

Or, to look at it another way, operators have bid so much higher than needed to accommodate the loan/agency drivers and they can afford to do this short term and then longer term, they can make substantial profits. Whereas with commercial routes, the cost of loan/agency drivers is too high and would make the services unviable and therefore subject to withdrawal so the better of two evils is to reduce the frequency to avoid a full withdrawal due to the route and possibly depot losing too much money.

 

[johncrossley]

Oh come off it. Just because you don't see the problem doesn't mean there isn't one. There may be a very big problem in Manchester when all the Go Ahead drivers return home

Maybe they will bring in other drivers, or some people will stay on in Manchester?

 

[M803UYA]

Oh come off it. Just because you don't see the problem doesn't mean there isn't one. There may be a very big problem in Manchester when all the Go Ahead drivers return home

Worth considering also that this pool of agency drivers is just that, a pool of people. They can't be in two places at once. So it's a temporary sticking plaster whilst new people come into the industry. The problem will arise when those new people don't stay around.

 

[Goldfish62]

Worth considering also that this pool of agency drivers is just that, a pool of people. They can't be in two places at once. So it's a temporary sticking plaster whilst new people come into the industry. The problem will arise when those new people don't stay around.

But that's the same everywhere.

 

[Megafuss]

Maybe they will bring in other drivers, or some people will stay on in Manchester?

A very small percentage may stay and they may well bring in drivers from elsewhere. But I bet it isn't from London, where it was reported in MyLondon earlier this year that 1 in every 20 services didn't run due to staff shortages....

 

[Goldfish62]

A very small percentage may stay and they may well bring in drivers from elsewhere. But I bet it isn't from London, where it was reported in MyLondon earlier this year that 1 in every 20 services didn't run due to staff shortages....

You can disregard MyLondon. The situation is very much better now.

Every GA OpCo has sent drivers to Manchester. That makes it an average of 8-10 per operator. Absolute peanuts.

People should be more focussed on how GNW are going to replace the 280 agency staff they've got with full time employees.

 

[markymark2000]

People should be more focussed on how GNW are going to replace the 280 agency staff they've got with full time employees.

Can I ask is there a public source for that number or do you know that number because of internal info?

(Not disputing it, just so I know before I quote that number elsewhere)

 

[Goldfish62]

Can I ask is there a public source for that number or do you know that number because of internal info?

(Not disputing it, just so I know before I quote that number elsewhere)

From more than one source close to the action, that's all I can say.

 

[markymark2000]

From more than one source close to the action, that's all I can say.

Fair enough. To be fair, it sounds like a good number given the operation and seeing the desperation of the agencies to get staff.

Now, just imagine if Burnham hadn't made a complete hash of this franchising and done it the London way, staff shortages would have been significantly lower, independents would have been included (note London has Uno and Sullivan's running TFL routes) and with more companies bidding, it would have meant cheaper contracts. Staff could have them stayed with their employer if they wanted to or gone to other firms. Instead Burnham has managed to get rid of 3 depots and change the ownership of 2 depots as well as rid 2 cross border operators off services (WOB & Hattons), expected all of the drivers to happily cross over to GoAhead and it means there is a shortage of 360 drivers short. Would never have happend if they went down the London franchising style or left it as it was.

 

[mangad]

Fair enough. To be fair, it sounds like a good number given the operation and seeing the desperation of the agencies to get staff.

Now, just imagine if Burnham hadn't made a complete hash of this franchising and done it the London way, staff shortages would have been significantly lower, independents would have been included (note London has Uno and Sullivan's running TFL routes) and with more companies bidding, it would have meant cheaper contracts. Staff could have them stayed with their employer if they wanted to or gone to other firms. Instead Burnham has managed to get rid of 3 depots and change the ownership of 2 depots as well as rid 2 cross border operators off services (WOB & Hattons), expected all of the drivers to happily cross over to GoAhead and it means there is a shortage of 360 drivers short. Would never have happend if they went down the London franchising style or left it as it was.

I can see your argument. But I suspect the reason they went the route they did with franchising is simple. In some areas there's one dominating operator. Stagecoach basically own Stockport and most of Tameside for example. They have the depots, they have the routes, they have the knowledge and experience. Apart from a handful of minor routes, Stockport's basically Stagecoach-town. So imagine a London style franchising system in Stockport. Who is going to get a look in? Everyone else would have massive setup costs and that would impact their bid price. Meanwhile London has operators who are strategically located in certain areas, there's enough depots and overlaps that they can do some competition. But even then there's areas of London where one company dominates.

It seems like the small franchises were supposed to be for the smaller operators. Your Stotts, Vision Bus, High Peak, hey, at one time, Little Gem. It feels exactly what those were targetted at. But it's not happened because the big operators like Diamond have swept them all up. Good intentions but it didn't work. Maybe it's something they can learn from in the future. or maybe the small franchises basically are not a long term prospect anymore.

And let's not oversell the presence of indies in London. Those that there are are tiny in comparison. It's mostly a big operator game - as it is in most cities - and the few attempts there have been to create new operators in the last few decades, have often been very shortlived and long gone. It's not likely to be a massive increase in indies running in London any time soon. In that, Greater Manchester will be no different.

 

[markymark2000]

In some areas there's one dominating operator. Stagecoach basically own Stockport and most of Tameside for example. They have the depots, they have the routes, they have the knowledge and experience. Apart from a handful of minor routes, Stockport's basically Stagecoach-town. So imagine a London style franchising system in Stockport. Who is going to get a look in?

High Peak & D&G both run stuff in south Manchester. Nexus Move and Stotts both have routes in Stockport. Companies can, and do travel about for work of their choosing. Wythenshawe depot isn't a million miles away. Yes it would have been difficult to ensure that it was fair but it could have been done. It's not hard to put in the tender specs that no company will be awarded more than a certain percentage of the network.

GoAhead happily opened up the Heywood depot for some short term contracts so clearly some firms are happy to look at new areas to get contracts.

Meanwhile London has operators who are strategically located in certain areas, there's enough depots and overlaps that they can do some competition.

If it was franchised a routes, more firms may have opened depots of small operating centres. There was no point setting up depots to compete in the deregulated market because of how Stagecoach reacts, with it contracted though, it's very different and more firms could have opened more depots and it become like London, all strategically placed with overlap for competition.

It seems like the small franchises were supposed to be for the smaller operators. Your Stotts, Vision Bus, High Peak, hey, at one time, Little Gem. It feels exactly what those were targetted at. But it's not happened because the big operators like Diamond have swept them all up. Good intentions but it didn't work. Maybe it's something they can learn from in the future. or maybe the small franchises basically are not a long term prospect anymore.

Firstly, if it was done on a per route basis, companies could then bid for as much of as little as they wanted and it could have been that operators only wanted certain routes but how it was done meant you got a selection of routes set by TFGM. Some routes are less favourable than others perhaps due to vehicle requirements or distance from the depot or just generally difficult to run operationally.

It's worth saying, TFGM awarded the tenders. Nothing stopped them swaying it toward the independents. Instead First and Diamond has won small bus tenders! Burnham wanted it to look like he was accomodating smaller operators, he had no intention of awarding to small operators though.

And let's not oversell the presence of indies in London. Those that there are are tiny in comparison. It's mostly a big operator game - as it is in most cities - and the few attempts there have been to create new operators in the last few decades, have often been very shortlived and long gone. It's not likely to be a massive increase in indies running in London any time soon. In that, Greater Manchester will be no different.

Agreed in part. The London tendering system at least gives options for smaller operators to easily bid. Take on a small bit of work to dip their toe in the water. The small tenders help anyone join though, even say Tower Transit wanted in but didn't want to take on too much incase they didn't like it. 1 route, give it a try, nice local route next to the yard. Like it get a depot, don't like it, rid the contract in a few years. In Manchesters tenders though is though lock into a bigger contract with multiple routes which may not be as close to your yard. You need a decent depot and the setup costs for that are too prohibitive for any new entrant and that is for most businesses.

 

[WatcherZero]

Fair enough. To be fair, it sounds like a good number given the operation and seeing the desperation of the agencies to get staff.

Now, just imagine if Burnham hadn't made a complete hash of this franchising and done it the London way, staff shortages would have been significantly lower, independents would have been included (note London has Uno and Sullivan's running TFL routes) and with more companies bidding, it would have meant cheaper contracts. Staff could have them stayed with their employer if they wanted to or gone to other firms. Instead Burnham has managed to get rid of 3 depots and change the ownership of 2 depots as well as rid 2 cross border operators off services (WOB & Hattons), expected all of the drivers to happily cross over to GoAhead and it means there is a shortage of 360 drivers short. Would never have happend if they went down the London franchising style or left it as it was.

There were nine separate bidders for franchises and the bids were cheaper than expected (they used the average subsidised service fee per mile as the baseline for franchise budget forecasts) leading to a 5% underspend in the franchising budget to 2025, 1 of the Wigan small franchises attracted no bids so it was rolled into the large franchise while 1 of the other small franchises there were two bids but they were considered uncompetitive so that was rolled into a larger franchise as well. The main issue they have had is with the Bolton and Wigan depot transfers where the bus companies previously had a leasehold rather than owned their depots outright, The 150 year leaseholds were bought by GMCA from the bus companies and then leased to TfGM for £1 p/a and subleased back to the Bus operators until Tranche 1 began, however the freeholders were demanding that commercial depot rental fees be charged by TfGM to the interim users as that allowed them to claim back property taxes but as TfGM didnt own the leases they would be unable to claim a VAT rebate for the rent they charged to the interim operators so its proposed that for tranche 2&3 TfGM will own the leaseholds rather than GMCA and the leaseholds for Tranche 1 will be transferred as assets to TfGM.

 

[Goldfish62]

There were nine separate bidders for franchises and the bids were cheaper than expected (they used the average subsidised service fee per mile as the baseline for franchise budget forecasts) leading to a 5% underspend in the franchising budget to 2025, 1 of the Wigan small franchises attracted no bids so it was rolled into the large franchise while 1 of the other small franchises there were two bids but they were considered uncompetitive so that was rolled into a larger franchise as well. The main issue they have had is with the Bolton and Wigan depot transfers where the bus companies previously had a leasehold rather than owned their depots outright, The 150 year leaseholds were bought by GMCA from the bus companies and then leased to TfGM for £1 p/a and subleased back to the Bus operators until Tranche 1 began, however the freeholders were demanding that commercial depot rental fees be charged by TfGM to the interim users as that allowed them to claim back property taxes but as TfGM didnt own the leases they would be unable to claim a VAT rebate for the rent they charged to the interim operators so its proposed that for tranche 2&3 TfGM will own the leaseholds rather than GMCA and the leaseholds for Tranche 1 will be transferred as assets to TfGM.

Very interesting. Thanks for the insight.

 

[Andyh82]

Is anyone able to summarise the depot situation, who is operating from where in Phase 1 and which depots have changed hands/disposed of/been set up new?

 

[johncrossley]

There are probably more examples of bus tendering done the Manchester way than the London way. In hindsight TfL would probably prefer doing it the Manchester way but they were trailblazers, not only for the UK but for Europe and maybe the whole world.

 

[Goldfish62]

There are probably more examples of bus tendering done the Manchester way than the London way. In hindsight TfL would probably prefer doing it the Manchester way but they were trailblazers, not only for the UK but for Europe and maybe the whole world.

Certainly area tendering has been looked at in London, but it's always been a case of, "if it ain't broke, etc".

 

[Deerfold]

Now, just imagine if Burnham hadn't made a complete hash of this franchising and done it the London way, staff shortages would have been significantly lower, independents would have been included (note London has Uno and Sullivan's running TFL routes)

Sullivan's have said they'll not be bidding again. Uno run half a dozen school routes.
In the last 20 years half a dozen independents have been sold to larger operators or gone bust.

 

[mangad]

High Peak & D&G both run stuff in south Manchester. Nexus Move and Stotts both have routes in Stockport. Companies can, and do travel about for work of their choosing. Wythenshawe depot isn't a million miles away. Yes it would have been difficult to ensure that it was fair but it could have been done. It's not hard to put in the tender specs that no company will be awarded more than a certain percentage of the network.

If you look at commercial services, it's pretty much Stagecoach. they play a very big role in the local schools contracts.

Stotts have a few small routes, High Peak have the 199 and the two hourly 394. D&G have a few bits and pieces. But stand in the town centre and you will see how much Stagecoach dominate.

There are probably more examples of bus tendering done the Manchester way than the London way. In hindsight TfL would probably prefer doing it the Manchester way but they were trailblazers, not only for the UK but for Europe and maybe the whole world.

London was also a different situation in that London Buses was broken up, tenders were introduced, and the companies sold off. Consolidation then happened later.

 

[WatcherZero]

Is anyone able to summarise the depot situation, who is operating from where in Phase 1 and which depots have changed hands/disposed of/been set up new?

All the large depots will be owned by TfGM and leased to the operators, they are also running a residual value scheme for buses similar to railway Tocs assets where they will buy them for residual value at the end of the franchises and sell them on or lease them to the succeeding franchisee.

Wigan depot was owned by Stagecoach and Bolton depot by Diamond both large franchises have been won by Go-Ahead while Diamond (Rotala) will operate the small franchises.
Goodwins depot in Eccles has been bought by Rotala to operate small franchises from.
Stagecoach had Middleton, Oldham was First, and Queen’s Road Go-Ahead, all three large franchises have been won by Stagecoach while small franchises have been won by Diamond and First.
School contracts were won 50/50 by Stagecoach and Vision (vision have their own depot in Bolton while Stagecoach will likely operate them from one of its tranche 2 depots or an outstation).

TfGM/GMCA have paid for Bolton, Oldham and Stockport bus depots to be electrified.

 

[johncrossley]

Incumbency would have been a huge advantage. That's why Rotala bought into the area, specifically so they could take advantage of future tendering.

 

[cnjb8]

Wigan depot was owned by Stagecoach and Bolton depot by First both large franchises have been won by Go-Ahead while Diamond (Rotala) will operate the small franchises.
Stagecoach had Middleton, Oldham was First, and Queen’s Road Go-Ahead, all three large franchises have been won by Stagecoach while small franchises have been won by Diamond and First.
School contracts were won 50/50 by Stagecoach and Vision (vision have their own depot in Bolton while Stagecoach will likely operate them from one of its tranche 2 depots or an outstation).
Goodwins depot in Eccles has been bought by Rotala to operate small franchises from.

TfGM/GMCA have paid for Bolton, Oldham and Stockport bus depots to be electrified.

Stagecoach opened a depot in Little Hulton for school work.

I do find it interesting Stagecoach have bought nearly 150 BZLs for Stockport when they may not be the operator there soon

 

[WibbleWobble]

I wonder if the "area" approach is a bit of a sly move by TfGM - if authorities are ever able to set up their own operators, then it would allow TfGM to easily and cheaply take over the network and run it all in-house. They've already got the depots, the buses will have depreciated somewhat and will be easy to take on (as they would all return to the "notional pool") and the drivers would TUPE across.

 

[pokemonsuper9]

and Bolton depot by First

Bolton depot was sold to Diamond years before franchising.

 

[WatcherZero]

The electric buses in Stockport transfer to TfGM ownership when Tranche 3 starts for a small residual remuneration, their purchase was partly funded by TfGM grants.

Bolton depot was sold to Diamond years before franchising.

Mid 2019, corrected.