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Rail Travel - UK - July 2014

“Fast growing tablet ownership, in connection with emerging superfast Wi-Fi, offers opportunities to provide bespoke online entertainment packages to travellers, for example by partnering with content providers such as Netflix, Spotify Premium, tablet magazine/newspaper publishers and e-booksellers.”

–    John Worthington, Senior Analyst

This report looks at the following areas:

  • How can rail attract more older travellers?
  • Combating perceptions of poor value for money
  • How can train companies maximise the opportunities of mobile technology?

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Table of contents

  1. Introduction

      • Definition
        • Abbreviations
        • Executive Summary

            • The market
              • Full steam ahead
                • Figure 1: Volume forecast of UK passenger rail journeys, 2013/14-18/19
                • Figure 2: Value forecast of UK passenger rail journeys, 2013/14-18/19
              • London/South East in driver’s seat
                • Figure 3: Volume of UK passenger rail journeys*, percentage growth, 2008/09-2013/14
              • Market factors
                • Fares rising but so are motoring costs
                  • Figure 4: Retail Price Index: Transport components, 1997-2013
                • Airline-style pricing yields success
                  • Figure 5: UK domestic passenger rail journeys, by ticket type, percentage growth 2008/09-2012/13
                • Nearly £40 billion investment over next five years
                  • Companies, brands and innovation
                    • Govia is market leader…
                      • Figure 6: UK train operating companies, number of franchises* and passenger journeys, July 2014**
                    • … but FirstGroup covers most ground
                      • Eurostar goes Dutch
                        • The consumer
                          • Six in ten adults use UK trains
                            • Figure 7: Purpose of train travel within the UK over the past 12 months, May 2014
                          • Six in ten book in advance
                            • Figure 8: How last rail trip was booked, May 2014
                          • Women choose table seats
                            • Figure 9: Preferences/behaviour during last rail trip, May 2014
                          • Five hour tipping point
                            • Figure 10: Maximum time people are prepared to travel by train for personal/leisure and business purposes, May 2014
                          • Comfort/cost concerns
                            • Figure 11: Attitudes towards travelling by train, May 2014
                          • What we think
                          • Issues and Insights

                              • How can rail attract more older travellers?
                                • The facts
                                  • The implications
                                    • Combating perceptions of poor value for money
                                      • The facts
                                        • The implications
                                          • How can train companies maximise the opportunities of mobile technology?
                                            • The facts
                                              • The implications
                                              • Trend Application

                                                  • Trend: Mood to Order
                                                    • Trend: Entrepreneurial Spirit
                                                      • Trend: Who are the Joneses
                                                      • Market Drivers

                                                        • Key points
                                                          • Travel market performance patchy despite economic upturn
                                                            • Figure 12: Great Britain domestic overnight travel, volume, total and split by purpose, 2008-13
                                                            • Figure 13: Overseas travel, volume, total and split by purpose, 2008-13
                                                          • Tunnel has weathered storm better than air/sea travel
                                                            • Figure 14: Overseas travel, volume split by mode, total, holiday, business & VFR, 2009-13
                                                            • Figure 15: Overseas travel volume, UK to France, Belgium, Netherlands and Germany, split by mode, all purposes, 2013
                                                          • Has UK reached ‘peak car’?
                                                            • Figure 16: Licensed cars in Great Britain, 2004-2013
                                                            • Figure 17: Car ownership in Great Britain, 2004/05-2011/12
                                                            • Figure 18: Percentage of households in Great Britain with no car/van, by region 1995/96-2011/12
                                                          • Car running costs driving people to rail…
                                                            • Figure 19: Retail Price Index: Transport components, 1997-2013
                                                          • … but still small swings in overall context
                                                            • Figure 20: National Travel Survey 2012: Percentage of domestic distance travelled, by purpose and mode
                                                            • Figure 21: National Travel Survey 2006: Percentage of domestic distance travelled, by purpose and mode
                                                          • Long distance rail outstrips domestic flights
                                                            • Figure 22: Long-distance domestic rail vs domestic airline passengers, 2003/04-2012/13
                                                          • Green(ish) rail
                                                            • Figure 23: UK carbon dioxide emissions, by transport mode, percentage share of all UK emissions, 2008-11
                                                          • £38 billion to be invested in rail network by 2019
                                                            • HS2 be or not to be?
                                                              • Fares fair?
                                                                • Long distance offers more mixed picture
                                                                  • Figure 24: Comparison of long distance rail journey fares, UK, France, Italy and Germany, 2014
                                                                • Class act
                                                                  • Eurostar diversifies
                                                                    • High Speed Europe
                                                                      • Figure 25: High speed rail networks in Europe, November 2013
                                                                  • Who’s Innovating?

                                                                    • Key points
                                                                      • Two’s company
                                                                        • Split the difference
                                                                          • Mixed mode
                                                                            • On track
                                                                              • New bike scheme
                                                                                • Sleeper service gets wake-up call
                                                                                  • London to the rest of the world departing from platform 1
                                                                                  • Market Size and Forecast

                                                                                    • Key points
                                                                                      • Rail journeys up by a quarter in past five years
                                                                                        • Figure 26: Volume of UK passenger rail journeys, 2008/09-2018/19*
                                                                                      • Rail travel spend has doubled in a decade
                                                                                        • Figure 27: Value of UK passenger rail journeys*, 2008/09-2018/19
                                                                                      • Discounted fares account for 40% of ticket revenue
                                                                                        • Figure 28: Estimated value of UK domestic rail passenger journeys, by fare type, 2008/09-2013/14
                                                                                      • Eurostar passes 10 million mark
                                                                                        • Figure 29: Eurostar passenger volume and expenditure, 2008-13
                                                                                      • Forecast
                                                                                        • Figure 30: Volume forecast of UK passenger rail journeys, 2013/14-18/19
                                                                                        • Figure 31: Value forecast of UK passenger rail journeys, 2013/14-18/19
                                                                                      • Forecast methodology
                                                                                      • Market Segmentation

                                                                                        • Key points
                                                                                          • South East the key driver of growth
                                                                                            • Figure 32: Volume of UK passenger rail journeys, by type of service, 2008/09-2013/14**
                                                                                          • Long distance accounts for a third of passenger expenditure
                                                                                            • Figure 33: UK passenger long distance rail journeys, volume, value and average fare, 2008/09-2013/14
                                                                                          • Commuter journeys growing twice as fast as leisure/VFR/business
                                                                                            • Figure 34: Estimated proportion and volume of UK domestic rail passenger journeys, by purpose, 2008/09 vs 2012/13
                                                                                          • Rise of discount culture
                                                                                            • Figure 35: UK domestic passenger rail journeys, by ticket type, 2008/09 vs 2012/13
                                                                                        • Market Share

                                                                                          • Key points
                                                                                            • First ScotRail, Northern and First Great Western cover greatest distance
                                                                                              • Figure 36: Great Britain rail operating companies, July 2014
                                                                                            • New franchise developments
                                                                                                • Figure 37: UK train operating companies, number of franchises* and passenger journeys, July 2014**
                                                                                            • Companies and Products

                                                                                                • Arriva Trains Wales
                                                                                                    • Figure 38: Financials for Arriva Trains Wales, 2011 and 2012
                                                                                                  • CrossCountry
                                                                                                      • Figure 39: Financials for CX Trains Limited, 2011 and 2012
                                                                                                    • East Coast
                                                                                                        • Figure 40: Financials for Directly Operated Railways, 2012 and 2013
                                                                                                      • First Great Western
                                                                                                          • Figure 41: Financials for First Group plc, 2012 and 2013
                                                                                                        • First ScotRail
                                                                                                            • Figure 42: Financials for First ScotRail Limited, 20102 and 2013
                                                                                                          • Northern Rail
                                                                                                              • Figure 43: Financials for Northern Rail Limited, 2012 and 2013
                                                                                                            • Southern Rail
                                                                                                                • Figure 44: Financials for Southern Railway Limited, 2012 and 2013
                                                                                                              • Virgin Trains
                                                                                                                  • Figure 45: Financials for Virgin Rail Group Limited, 2012 and 2013
                                                                                                                • Eurostar
                                                                                                                    • Figure 46: Financials for Eurostar, 2012 and 2013
                                                                                                                  • Great Rail Journeys
                                                                                                                      • Figure 47: Financials for Great Rail Journeys Limited, 2012 and 2013
                                                                                                                    • The Man in Seat Sixty-One
                                                                                                                    • The Consumer – Domestic Rail Usage

                                                                                                                      • Key points
                                                                                                                        • Six in ten adults use the train
                                                                                                                          • Figure 48: Purpose of train travel within the UK over the past 12 months, May 2014
                                                                                                                        • 16-34 age group leads for all types of rail travel
                                                                                                                          • Figure 49: Train travel within the UK over the past 12 months, day trips and overnight trips, by age group, May 2014
                                                                                                                          • Figure 50: Train travel within the UK over the past 12 months, purpose of travel, by age group, May 2014
                                                                                                                        • Half of adults use train for longer journeys
                                                                                                                            • Figure 51: Train travel within the UK over the past 12 months, journeys of 1 hour+ (excl. commuting), by age group, May 2014
                                                                                                                        • The Consumer – Frequency of Longer Distance Domestic Rail Travel

                                                                                                                          • Key points
                                                                                                                            • Londoners are most regular rail travellers (and not just commutes)
                                                                                                                              • Figure 52: Number of train journeys of one hour or longer taken over the past 12 months, May 2014
                                                                                                                              • Figure 53: gender profile of regular longer distance travellers over the past 12 months, May 2014
                                                                                                                              • Figure 54: Age profile of regular longer distance travellers over the past 12 months, May 2014
                                                                                                                              • Figure 55: Socio-economic profile of regular longer distance travellers over the past 12 months, May 2014
                                                                                                                          • The Consumer – Overseas Rail Travel

                                                                                                                            • Key points
                                                                                                                              • Eurostar travel show clear male bias
                                                                                                                                • Figure 56: Purpose of train travel via Eurostar over the past 12 months, May 2014
                                                                                                                                • Figure 57: Gender profile of Eurostar passengers over the past 12 months, May 2014
                                                                                                                                • Figure 58: Age profile of Eurostar passengers over the past 12 months, May 2014
                                                                                                                                • Figure 59: Socio-economic profile of Eurostar passengers over the past 12 months, May 2014
                                                                                                                              • Three in ten Eurostar travellers have taken 7+ trips in past year
                                                                                                                                • Figure 60: Number of train journeys made by Eurostar over the past 12 months, May 2014
                                                                                                                            • The Consumer – How Longer Distance Rail Travel Is Booked

                                                                                                                              • Key points
                                                                                                                                • Six in ten book in advance but mobile remains low
                                                                                                                                  • Figure 61: How last rail trip was booked, May 2014
                                                                                                                              • The Consumer – Rail Travel Behaviour

                                                                                                                                • Key points
                                                                                                                                  • Table seats prove popular
                                                                                                                                    • Figure 62: Preferences/behaviour during last rail trip, May 2014
                                                                                                                                  • Seating
                                                                                                                                    • Buying behaviour
                                                                                                                                      • Technology
                                                                                                                                        • Bike carriage
                                                                                                                                        • The Consumer – Length of Time People Are Willing To Travel By Train

                                                                                                                                          • Key points
                                                                                                                                            • Five-hour tipping point for leisure/four for business
                                                                                                                                                • Figure 63: Maximum time people are prepared to travel by train for personal/leisure and business purposes, May 2014
                                                                                                                                            • The Consumer – Attitudes Towards Rail Travel

                                                                                                                                              • Key points
                                                                                                                                                • Trains seen as relaxing but concerns over cost and cramming
                                                                                                                                                  • Figure 64: Attitudes towards travelling by train, May 2014
                                                                                                                                                  • Figure 65: Attitudes towards travelling by train, May 2014
                                                                                                                                                • High speed enthusiasts
                                                                                                                                                  • Poor value perceptions
                                                                                                                                                    • Different ticket options still causing confusion
                                                                                                                                                      • Affluent Londoners among the most positive about rail travel
                                                                                                                                                        • Pre-retirement age group don’t see value
                                                                                                                                                          • Making rail more family-friendly
                                                                                                                                                          • Appendix – Market Size and Forecast

                                                                                                                                                              • Figure 66: Forecasts for holiday car hires abroad, volume, 2013/14-18/19
                                                                                                                                                              • Figure 67: Forecasts for holiday car hires abroad, value, 2013/14-18/19
                                                                                                                                                          • Appendix – Domestic Rail Usage

                                                                                                                                                              • Figure 68: Most popular purpose of train travel within the UK over the past 12 months – Any journey, by demographics, May 2014
                                                                                                                                                              • Figure 69: Next most popular purpose of train travel within the UK over the past 12 months – Any journey, by demographics, May 2014
                                                                                                                                                              • Figure 70: Other purpose of train travel within the UK over the past 12 months – Any journey, by demographics, May 2014
                                                                                                                                                              • Figure 71: Least popular purpose of train travel within the UK over the past 12 months – Any journey, by demographics, May 2014
                                                                                                                                                          • Appendix – Frequency of Longer Distance Domestic Rail Travel

                                                                                                                                                              • Figure 72: Number of train journeys of one hour or longer taken over the past 12 months, by most popular purpose of train travel within the UK over the past 12 months – Any journey, May 2014
                                                                                                                                                              • Figure 73: Number of train journeys of one hour or longer (1-6) taken over the past 12 months, by demographics, May 2014
                                                                                                                                                              • Figure 74: Number of train journeys of one hour or longer (7+) taken over the past 12 months, by demographics, May 2014
                                                                                                                                                          • Appendix – Overseas Rail Travel

                                                                                                                                                              • Figure 75: Most popular purpose of train travel via Eurostar over the past 12 months, by demographics, May 2014
                                                                                                                                                              • Figure 76: Next most popular purpose of train travel via Eurostar over the past 12 months, by demographics, May 2014
                                                                                                                                                              • Figure 77: Number of train journeys made by Eurostar (1-6) over the past 12 months, by demographics, May 2014
                                                                                                                                                              • Figure 78: Number of train journeys (7+) made by Eurostar over the past 12 months, by demographics, May 2014
                                                                                                                                                          • Appendix – How Longer Distance Rail Travel Is Booked

                                                                                                                                                              • Figure 79: How last rail trip was booked, by purpose of train travel within the UK over the past 12 months – Any journey, May 2014
                                                                                                                                                              • Figure 80: How last rail trip was booked, by purpose of train travel via eurostar over the past 12 months, May 2014
                                                                                                                                                              • Figure 81: How last rail trip was booked, by demographics, May 2014
                                                                                                                                                          • Appendix – Rail Travel Behaviour

                                                                                                                                                              • Figure 82: Preferences/behaviour during last rail trip, by purpose of train travel within the UK over the past 12 months – Any journey, May 2014
                                                                                                                                                              • Figure 83: Preferences/behaviour during last rail trip, by number of train journeys of one hour or longer taken (1-4) over the past 12 months, May 2014
                                                                                                                                                              • Figure 84: Preferences/behaviour during last rail trip, by number of train journeys of one hour or longer (5+) taken over the past 12 months, May 2014
                                                                                                                                                              • Figure 85: Preferences/behaviour during last rail trip, by purpose of train travel via Eurostar over the past 12 months, May 2014
                                                                                                                                                              • Figure 86: Most popular preferences/behaviour during last rail trip, by demographics, May 2014
                                                                                                                                                              • Figure 87: Next most popular preferences/behaviour during last rail trip, by demographics, May 2014
                                                                                                                                                              • Figure 88: Other preferences/behaviour during last rail trip, by demographics, May 2014
                                                                                                                                                          • Appendix – Length of Time People Are Willing To Travel By Train

                                                                                                                                                              • Figure 89: Maximum time people are prepared to travel by train for personal/leisure purposes, by most popular purpose of train travel within the UK over the past 12 months – Any journey, May 2014
                                                                                                                                                              • Figure 90: Maximum time people are prepared to travel by train for personal/leisure purposes, by purpose of train travel via Eurostar over the past 12 months, May 2014
                                                                                                                                                              • Figure 91: Maximum time people are prepared to travel by train for personal/leisure purposes, by demographics, May 2014
                                                                                                                                                              • Figure 92: Maximum time people are prepared to travel by train for personal/leisure purposes, by demographics, May 2014 (continued)
                                                                                                                                                              • Figure 93: Maximum time people are prepared to travel by train for business purposes, by most popular purpose of train travel within the UK over the past 12 months – Any journey, May 2014
                                                                                                                                                              • Figure 94: Maximum time people are prepared to travel by train for business purposes, by demographics, May 2014
                                                                                                                                                              • Figure 95: Maximum time people are prepared to travel by train for business purposes, by demographics, May 2014 (continued)
                                                                                                                                                          • Appendix – Attitudes Towards Rail Travel

                                                                                                                                                              • Figure 96: Attitudes towards travelling by train, by most popular purpose of train travel within the UK over the past 12 months – Any journey, May 2014
                                                                                                                                                              • Figure 97: Attitudes towards travelling by train, by next most popular purpose of train travel within the UK over the past 12 months – Any journey, May 2014
                                                                                                                                                              • Figure 98: Attitudes towards travelling by train, by other purpose of train travel within the UK over the past 12 months – Any journey, May 2014
                                                                                                                                                              • Figure 99: Attitudes towards travelling by train, by least popular purpose of train travel within the UK over the past 12 months – Any journey, May 2014
                                                                                                                                                              • Figure 100: Attitudes towards travelling by train, by most popular preferences/behaviour during last rail trip, May 2014
                                                                                                                                                              • Figure 101: Attitudes towards travelling by train, by next most popular preferences/behaviour during last rail trip, May 2014
                                                                                                                                                              • Figure 102: Agreement with most popular attitudes towards travelling by train, by demographics, May 2014
                                                                                                                                                              • Figure 103: Agreement with next most popular attitudes towards travelling by train, by demographics, May 2014
                                                                                                                                                              • Figure 104: Agreement with next most popular attitudes towards travelling by train, by demographics, May 2014 (continued)
                                                                                                                                                              • Figure 105: Agreement with least popular attitudes towards travelling by train, by demographics, May 2014
                                                                                                                                                              • Figure 106: Agreement with least popular attitudes towards travelling by train, by demographics (continued), May 2014

                                                                                                                                                          Companies Covered

                                                                                                                                                          • Association of Independent Travel Operators (AITO)
                                                                                                                                                          • Eurostar UK Ltd
                                                                                                                                                          • First Capital Connect Ltd
                                                                                                                                                          • FirstGroup plc
                                                                                                                                                          • Great Rail Journeys
                                                                                                                                                          • Keolis
                                                                                                                                                          • National Express Limited
                                                                                                                                                          • Network Rail
                                                                                                                                                          • Serco Group plc
                                                                                                                                                          • Stagecoach Group plc
                                                                                                                                                          • The Association of Independent Tour Operators
                                                                                                                                                          • Virgin Group Ltd.
                                                                                                                                                          • Virgin Trains

                                                                                                                                                          Rail Travel - UK - July 2014

                                                                                                                                                          £1,995.00 (Excl.Tax)