Road winning over rail

by The Times 100 on Monday 14th April, 2008

Road winning over rail

Official figures undermine the Government's claim that it is working to switch commuters from cars to trains. They indicate that the road network is growing 15 times faster than the rail network. Statistics show that more than 405 miles of motorway and trunk road have opened since 1997 compared with just 27 miles of railway. (The Times, 11 March 2008)

The rail network grew by only six miles a year in 2001 and 2002 and in five out of the past 11 years no track has been added. In contrast, the system of main roads has increased by up to 85 miles a year with a further 40 large-scale road schemes in development by the Highways Agency. The only significant new rail line planned for England is Crossrail. This will not open before 2017, despite the fact that since 1997 rail passenger miles have risen by 50% and road traffic by 12%. In January, Network Rail said that Britain would need up to 1,000 miles of new high-speed line by 2020. (The Times, 11 March 2008).

Norman Baker, Liberal Democrats transport spokesman, said: 'What we need is a programme of rail investment which includes new and re-opened track and stations and without which, overcrowding on our railways will become intolerable within ten years.' (The Times, 11 March 2008)

A spokesperson for ETA (the Environmental Transport Association) said: 'The railway deserves proper investment, but passengers deserve a decent, value-for-money service. Until recently a rail ticket from Inverness to King's Cross cost £298 for an open return fare – £2 more than a flight to Antigua.' (ETA website)

The Times 100 includes two case studies on businesses involved in different aspects of rail transport, although some of the business issues they face are similar. They both need to meet the needs of their customers within organisational and market constraints.

  1. Go-Ahead's history is closely tied to the story of transport privatisation in this country. In 1996 British Rail (the government-owned-and-run rail industry) was privatised with some companies maintaining the rail tracks, signalling and stations and others offering passenger services. Go-Ahead holds the franchises for Southern as well as Southeastern rail, making it the largest commuter train operator in London. Contracts for regulated bus and rail franchises are renewed every few years. Go-Ahead has to prove it provides competitive services and offer customers value for money to retain its position.
  2. Network Rail owns and operates Britain's rail infrastructure. The company strives to provide Britain with a safe, reliable and efficient railway fit for the 21st century. It has a clear instruction from the Department for Transport to improve operating efficiency. Network Rail does not pay dividends to shareholders but does aim to make a profit. Profits are used to cut debt and most importantly, to invest in the rail infrastructure. Network Rail needs to take account of all the external environment factors that could affect its business.

Sources:

The Times Online – Road system growing 15 times faster than railway line network, 11 March 2008

ETA – Roads growing 15 times faster than railway

The Times 100 Edition 12 Case Studies – Go-Ahead, Meeting needs in a competitive sector

The Times 100 Edition 12 Case Studies – Network Rail, Using PESTEL to design effective strategies

Potential Study Questions:

  • What does the acronym PESTEL stand for?
  • What does a PESTEL analysis investigate and how can a business use this information?
  • Information from a PESTEL analysis can feed into a SWOT analysis. What does a SWOT analysis identify and evaluate?

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