Category Archives: Flights v. Trains

What does Warren Buffett’s train investment say about airlines?

Posted on by
Reply

So, Warren Buffett has invested some $26 billion buying American freight operator BNSF, with news commentators hailing this as an ‘all-in’ bet on the future of the US economy. But there’s more to it than that – it is, of course, a huge leap of faith into the future of railways, even if lumping coal isn’t exactly as glamarous as swish new high speed train sets. But Buffett has never been about style over substance, and trains in Europe are usually associated with massive subsidies.

In typical long-term Buffett style, he has talked about growth potential of rail in the USA over the next 3 decades, and even if this investment is in freight railways, there is no doubt that passenger rail networks will also see substantial development over this period.

Compare this to Buffett’s attitudes towards airlines, after he lost 75% of his $385 million investment in US Airways back in 1995. He pointed out that the he didn’t think the US airline business had ever made money – and this was in an industry without the kind of state carrier subsidies which were common elsewhere in the world. Buffett is quoted as saying, in respect of the Wright brothers’ first flight:

“If there had been a capitalist down there, the guy would have shot down Wilbur. One small step for mankind, and one huge step for capitalism.”

Has anything changed in the airline industry since 1995? Well, there’s been plenty of deregulation across the pond, and plenty of former big names are no longer with us. In Europe, we have Ryanair’s Michael O’Leary echoing many of Buffett’s sentiments, describing the current situation facing European airlines as a ‘bloodbath’, and the ‘perfect storm’. Of course, Ryanair are one of the few airlines to buck the trend, whereas this morning’s announcement from Lufthansa that they can’t find a suitable bidder for bmi, and that consequently bmibaby are shedding jobs hardly comes as a surprise.

Despite all this, Warren hasn’t been put off from investing in flying alltogether, having ditched his own private jet, aka ‘The Indefensible’ back in 1998, in favour of buying private jet hire company NetJets.

At last they admit it – flight taxes pay for bank bailouts

Posted on by
Reply

At long last, Chancellor Alistair Darling has said what we’ve known all along – that flight taxes (Air Passenger Duty) are used to sort out the dodgy banks, and nothing to do with the environment. Speaking to Northeast website The Journal last week, Darlin said:

I am quite blunt about it, we need to raise money to pay for some of the things we have done. If unemployment goes up there is a cost obviously to the family, there is cost in increased benefits, Northern Rock has cost a lot of money.

Now to be honest, no-one is going to step forward and offer their sympathy for the bankers, but many would still say that the bailouts had to be made in order to save the financial services industry. So, should airlines be made to suffer so another sector can survive?

Well, Darling seems to think so:

But if you think about it, what we are doing is putting a pound on to your average ticket, which about three quarters of people travel on. And you consider the cost of an air ticket, I don’t think a pound is that unreasonable.

The problem of course is that it isn’t “just a pound” on the average flight ticket. Last year, air passenger duty was doubled overnight in a move which saw one of the few taxes to have been reduced under the Labour government get re-stealthed. To make matters worse and add insult to injury, taxes had to be collected on flights which were already paid for – as if the chancellor (and former transport minister) was more interested in act of vengeance than a fair tax. Of course, Mr Darling, as MP for Edinburgh Central, is a fully paid-up member of the “you shouldn’t fly but I will” brigade, and that’s long before we bring up the issue of MP’s expenses.

Unlike some airlines and passengers, I don’t have a problem with air passengers paying their way through a ‘reasonable’ level of taxation – and I fully accept that the aviation industry must pay for its environmental costs. But let’s not forget that whereas motoring taxes are supposed to pay for the upkeep of the roads, usage of airports is already covered by separate airport handling fees levied by the (predominantly) private companies who run Britain’s airports.

Environmental costs should be covered by a global carbon trading agreement, due to be discussed in Copenhagen next month. Of course there’s loads of other arguments about the benefits of switching passengers from short hop flights to high speed rail, but that’s for another time. Or maybe, if that’s where APD funds were being directed, the travelling public wouldn’t mind so much. Mr Darling, if you are reading this, that isn’t an excuse to double APD again on you’re next whim!

 

 

 

 

Don’t fancy flying all the way to Australia? Why not go by bus?

Posted on by
Reply

When I first read about Oz-bus.com, I thought that April fools day had come early. A long distance bus service running all the way from London to Sydney – someone had to be taking the xxxx!

But it turns out that the service is real – and that they will take you by bus as far as the prevailing conditions will allow. This should essentially mean an overland journey to Iran, a possible flight across the border into Pakistan and then again to get through Burma, and a final flight between Bali in Indonesia and Darwin in Australia – but the rest of the journey is exactly as it says on the tin, by comfortable long distance coach, apparently limited to 35 passengers per trip, so I would presume a little bit more roomy than your average scoot through London on a crowded #73 Boris-baiting bendy bus!

With a one-way journey starting at £4399, you are going to spend a lot more than a business class flight, but we think this journey is going to be more about what you see on the way than what you do when you get there, so for a three month trip, this works out at a very reasonable £50 per day, including breakfast and basic accommodation.

I’ll have to admit to being a bit ‘bussist’ myself. If I’m going to do long distance surface transport, I’d rather go by rail or sea – but given a choice between a professional bus driver and the company of a 35 strong group, or going by car, I’d still take the bus any day. Oz-bus also offer an eastbound journey to New York – via China and Alaska, and journeys through Africa, so it really does look like they are carrying on where Eurolines and Greyhound leave off. It will be interesting to see if this kind of travel ‘takes off’ (very lame pun I know) as people look for low-carbon alternatives to flying, and it will certainly be an indicator of the ability for different countries to stimulate cross-border co-operation. Iran, Pakistan and Burma might be problem areas for now, but how long before the Facebook generation catches up and reaches parts Heineken can’t reach! Twitter has certainly lead the way in Iran at least, so let’s see!

The BNP v Eco-fundamentalists – both are equally fascist

Posted on by
Reply

I have no problem with the vast-majority of environmental campaigners, but there are a dangerous few out there who seem to think it is perfectly reasonable to impose a total ban on all domestic flights within the UK. More worrying than this opinion being widespread is the way it is allowed out on news reports without any kind of counter-argument. Yet whenever there is a suggestion of the BNP getting more air time, there is uproar.

So what is so wrong with suggesting a ban on domestic flights, in the name of the environment?  As the United Kingdom is made up of many islands, a sizeable portion of travel within her borders is always going to be made by air. Even over-land, there are many journeys which are totally unrealistic to make by rail, especially for business travellers wanting to head to important meetings and make it back in a day. People who think that it is an easy switch from air to rail tend not to be the ones that take the trains all that often.

Where rail services have improved, such as between London and Manchester, the proportion of people travelling by train has increased, but there will always be some people who will want to choose to fly, or who want to take a plane because the next step of their journey is an onward flight to another destination. As the network currently stands, travelling by train from Manchester to Heathrow is a great deal less convenient than flying.

Of course, some communication can be done by electronic means, but if travel broadens the mind, then those people who seek to prevent people from travelling must have very narrow minds. Except that they masquerade as intelligent, educated people acting in our best interests. At least we know what we are getting with the BNP – mindless thugs who want to see certain sectors of the population sent away. But we should never forget that freedom to move within our borders is just as important as the freedom to cross borders. I have spent time in Saudi Arabia, where we had to get a ’50k pass’ to travel internally, and it was a bureaucratic nightmare.

The environmental damage caused by flying is already healthily compensated for by existing APD (Air Passenger Duty), which is levied twice on internal flights – both on the outbound, and on the inbound journey. Even moderate increases in APD, when not counter-balanced by our European neighbours, result in a huge discouragement to travel within the UK, as flights abroad are proportionally taxed at a lower rate.

So by all means, let’s have a reasoned debate about choices in travel mode, and about their environmental impacts. But let’s not be fooled by people who think an outright ban on domestic flights, or even steep increases in their taxes, is remotely in the UK’s best interest.

As BMI scrap flights, is Heathrow’s loss just Amsterdam’s gain?

Posted on by
Reply

If ever there was a clear-cut argument in favour of Heathrow third runway, then it would be the fact that BMI have just scrapped their flights from Leeds Bradford and Durham Tees Valley to Heathrow. Anyone looking to transfer onto other flights will now have no option but to travel to Amsterdam with KLM instead, as neither of these airports offer hub feeder flights from any other airline.  

Proponents of Heathrow’s third runway argue that the extra capacity that would be created could be used to keep open domestic routes like these two, and also to connect other British cities with Heathrow which have lost their links due to the high taxes imposed on UK domestic flights. Obvious cities which might otherwise support flights into Heathrow would include Liverpool and Inverness in the north and Plymouth and Newquay in the southwest. Meanwhile, opponents argue that people should travel to Heathrow by rail, and that the overall number of flights should be reduced anyway, thus reducing the prospect of these routes from ever becoming viable again. 

Right now, the facts would appear to speak for themselves when it comes to connecting flights, but what about people who just want point-to-point travel between British regional cities and London? We would expect some passengers from Leeds Bradford and Durham to transfer to flights from Manchester and Newcastle respectively, but a far more significant number will travel by train. Both airports also talked about finding replacement airlines to open up new routes into London, but we heard the same rhetoric when VLM scrapped their Liverpool to London City flights. Perhaps Flybe could come onto the scene at Leeds Bradford, where they already have a presence, but I don’t see them operating Gatwick to Durham Tees Valley flights alongside their existing Gatwick to Newcastle route. 

When it comes to the economic arguments about losing jobs to Amsterdam, there is nothing new here. For many years, KLM have offered more feeder flights from UK regional airports than any other airline, and they are set to increase this further still when they open up their new Liverpool to Amsterdam flights at the end of this month. Naturally, this isn’t good news for the UK economy, but we shouldn’t forget that Heathrow’s third runway would come with considerable economic and environmental costs as well. Nor should we forget that the ‘hub and spoke’ model is an inefficient way of operating flights, even if there is always going to be a need for it on some routes.

The cheapest flights to Switzerland involve flights to a neighbouring country, but not France

Posted on by
Reply

Switzerland might have much more a reputation as a tax haven van as a bargain basement paradise, but here is a little-known option of finding the cheapest flights to Switzerland, and enjoying the scenery along the way. It is well-known that cheap flights to Geneva are available from a huge range of different airports throughout the UK, and that you can also get cheap flights to Basel, whose airport is technically in neighbouring France, from Stansted and Dublin courtesy of Ryanair, and Liverpool courtesy of easyJet. So what’s our little secret? Cheap flights to Zürich — that bastion of palatial airport facilities? Surely not? Well, with Aer Lingus and easyJet now fighting it out amongst each other to offer cheap flights from London Gatwick to Zürich, easyJet also offering Zürich flights from Luton, you might well be able to bag a bargain, but if you’re prepared to travel with only hand luggage and if you have got yourself one of those otherwise pointless electron cards then you should probably know that the very cheapest fares on flights to Europe are still offered by Ryanair.

We looked at cheap flights to Switzerland in April 2009, and Ryanair’s prices on flights to Basel were very compatible with what easyJet and Aer Lingus had to offer on flights to Zürich. The real bargain was on flights to Friedrichshafen in neighbouring Germany, which are available for £20 return “all-in.” All very well you might say, but you asked the cheap flights to Switzerland, not cheap flights to Germany. Well, as it happens, Friedrichshafen is a mere 45 minutes away from Romanshorn in Switzerland, on the other side of Lake Constance by ferry (hourly service). From here, there are regular trains throughout Switzerland via Zürich.

Trains connect from Friedrichshafen Airport (Flughafen) to downtown (Stadt) Friedrichshafen in just 6 minutes, and there are at least 4 services each hour. And the cost of this ferry transfer, with scenery thrown in? A mere €7 – but if you are using a Swiss Transfer Ticket (strongly recommended), you will pay half price. So next time you are thinkinh of cheap flights to Switzerland, why not give this route a try? 

Lose Angeles flights & rail suggestions

Posted on by
Reply

Suggestions for combining flights to Los Angeles with onward travel by train within and beyond California:

Trains within California

Compared to the US East Coast, rail travel in California is pretty poor, although there are a number of commuter rail routes which fan out from Union Station in Los Angeles. These are operated by ‘Metrolink’, and are not to be confused with ‘Metrorail’, who operate subway services in the county of Los Angeles. Although there is no direct fixed rail link between Los Angeles airport and the rail network, shuttle buses operate every half hour between Los Angeles airport and Union Station. Alternatively, a free shuttle bus service operates between the airport and the ‘Aviation/LAX’ stop on the Metro green line.

Flightmapping insider suggestion — we would certainly recommend paying a visit to the elaborately designed Hollywood and Vine station on the Metro red line, which takes its inspiration from the nearby Egyptian Theatre. Inside the station, support columns represent palm trees, whilst the interior ceiling is covered with metal film reels.

Further north, Caltrain does offer a limited commuter service within the San Francisco Bay area, which includes a link to San Francisco airport at Millbrae, and connections to San Jose and other towns within Silicon Valley. Passengers wanting to take the train from Los Angeles to San Francisco can take an Amtrak Thruway coach from Union Station to Bakersfield, and continue to Oakland by train, from where there is a connection to the San Francisco BART (Bay Area Rapid Transport) system. For passengers with a little bit more time to spare, the Coast Starlight, which runs from Los Angeles to Seattle via Oakland, offers a superb scenic route along the Pacific coast.

Long distance trains from Los Angeles

Rail buffs might also enjoy taking the Southwest Chief towards Chicago. This route includes a stop at Williams Junction and Flagstaff, both of which offer through connections to the Grand Canyon. However, for an even more scenic route, we would recommend taking the Coast Starlight to Sacramento, and then continuing towards Chicago on the California Zephyr. This route offers fantastic views as it winds its way through the Rocky Mountains between Grand Junction and Denver.