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Old September 10th, 2010, 01:21 PM   #1
Suburbanist
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MISC | Deregulation of Bus Services

I know this article has a title on buses, but is deals mostly with DB, hence I decided to put it here for discussion. Highlights are mine..
======================================================

Quote:
FRANKFURT —

A bus left Berlin last week. The country's largest international bus service is usually not allowed to drop passengers in Germany.
They will travel to Munich, or perhaps Düsseldorf or Stuttgart. They are bus journeys that, for the last 79 years, have been illegal.

Long-distance domestic bus service has, with a few exceptions, been outlawed in Germany since 1931. But the ban, originally intended to protect the state-owned railway system, is likely to soon fall away under pressure from a recent court decision and a decision by Chancellor Angela Merkel’s government to deregulate domestic travel.

Despite the country’s status as the economic locomotive of Europe and a model of competitiveness, some say that the fact that it has taken so long to lift the bus ban says something about how slowly things change in Germany.

“It’s an anachronism,” said Roderick Donker van Heel, general manager of Deutsche Touring, which offers bus service from Frankfurt and other cities to foreign destinations, but is usually not even allowed to drop off passengers within Germany.

The anti-bus law is also a reminder that, despite steady changes over the last decade, barriers to free enterprise remain in Europe. Germany and other countries still shield certain professions and industries from new competitors with thickets of regulation.

“Deutsche Bahn can do whatever it wants,” Mr. Donker van Heel said, referring to the state-owned railroad. “The airlines can do what they want.” But when a bus company wants to offer intercity service, “the answer is no. And we’re in the year 2010.”

Even now, abolition of the law, which allows bus service only when it would bring substantial improvements over existing train service, is not a done deal.

Germany’s highest court for administrative law ruled in June that Deutsche Touring, the country’s largest provider of international bus service, could offer service from Frankfurt to Dortmund. The court set a precedent by accepting the company’s argument that lower prices alone constitute a substantial improvement in service.

But Deutsche Bahn could still undercut the legal victory by matching the prices that Deutsche Touring would offer.

A Deutsche Bahn spokesman declined to comment, but provided a statement in which the company pointed out that local authorities, and not the rail operator, decided whether to authorize bus services. The company also maintained that future providers of bus transport should be required to provide regularly scheduled service, as Deutsche Bahn does.

German transportation law “is not designed to protect Deutsche Bahn the company, rather it serves to protect the rail system, which is used by Deutsche Bahn and many other competitors,” the company said.

Mrs. Merkel’s government has pledged to sweep away such barriers. Promoting entrepreneurship is a central goal of the Free Democrats, junior partners in the governing coalition with the Christian Democrats, Mrs. Merkel’s party.

Patrick Döring, deputy chairman of the Free Democrats in Parliament and the party’s spokesman on transportation issues, said he was hopeful that a draft of a revised law could be presented to Parliament within a few months. The revised law could take effect in time to allow wide-open bus competition by mid-2011.

“I am very optimistic it will quickly become an established form of transport,” Mr. Döring said.

Mr. Donker van Heel said he was eager to start. Deutsche Touring is already making plans for new routes, probably focusing on connections to major cities.

Still, he is keeping his expectations in check. He noted that even some smaller German bus companies were lobbying against full competition. They would prefer that regulators allocate routes to companies, which would then enjoy quasi-monopolies.

Why has it taken so long to allow a form of transportation that is taken for granted in most other countries?

“Deutsche Bahn is a power in Germany,” said Gunther Mörl, president of the Association of German Bus Companies. “And the bus companies have a smaller lobby. It’s as simple as that.”

Deutsche Touring was actually owned by Deutsche Bahn until 2005, when the railroad sold it to Ibero Eurosur, a consortium of Spanish and Portuguese bus companies with ties to counterparts in France and Britain. Deutsche Bahn, via subsidiaries, remains by far the biggest provider of local bus service in Germany.

With a fleet of Setra buses made by Daimler, Deutsche Touring specializes in serving the Poles, Croatians, Serbs and other Eastern Europeans who work in Western Europe and need an affordable way to visit home. On a recent day, passengers boarded a bus bound for Kosovo from Deutsche Touring’s depot on the outskirts of Frankfurt.

The fares are cheap. A one-way ticket to Pristina, the capital of Kosovo, costs 50 euros, or about $64, on Deutsche Touring, but also requires patience. The journey of about 1,050 miles takes 30 hours.

Because buses tend to be slower than trains, the prime customers will be budget-conscious young people, the jobless and elderly people “for whom the journey time is of secondary importance,” a recent study by Deutsche Bank said.

Bus companies are unlikely to steal many customers from Germany’s clean, fast and comprehensive train network, analysts said, though buses could put pressure on prices.

“The main effect is that we create a new opportunity for cheap mobility for people who can’t afford to go by train or plane,” said Alexander Eisenkopf, a professor at Zeppelin University in Friedrichshafen, Germany, who teaches mobility management.

Signs are that demand for bus travel could be strong. Nighttime service offered by Deutsche Touring from Mannheim in southwest Germany to Hamburg in the north, by way of several airports, is booming, Mr. Donker van Heel said, though he declined to give figures. The route exploits a loophole in existing law that allows bus service to airports.

Bus routes to and from Berlin, which are allowed for reasons dating to the city’s status as a cold war outpost, are also booming, according to Deutsche Bank. About 370,000 people ride the Hamburg-Berlin bus line each year. Still, that is only a little more than Deutsche Bahn carries between the two cities every day.

Michael Svedek, chief operating officer of Deutsche Touring, estimated that bus service might take 5 percent of the roughly 5 billion-euro transport market. Currently, bus travel accounts for only a 0.1 percent share of total passenger traffic in Germany, according to Deutsche Bank.

“For them, it’s peanuts,” Mr. Svedek said, referring to Deutsche Bahn. “For us, it’s good money.”
It is completely outrageous that a government precludes the national passenger operator company in a so anti-competitive way. If DB is as good as it likes to say it is, it shall have no problem with a bunch of buses running around and undercutting it. Let's the fare wares begin, hopefully to end national schedule coordination in Germany.

As I usually write here, national multimodal coordinated schedules are tantamount to preventing competition on its inception. They should be abolished altogether, as they relegate buses to a second position as feeders of trains, which makes sense in engineering and system consistency, but is a brutal attack on free market too, which we cannot tolerate.

Source: http://www.nytimes.com/2010/09/10/bu...ef=global-home
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Old September 10th, 2010, 02:36 PM   #2
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the free market is just an idea

Quote:
Originally Posted by Suburbanist View Post
As I usually write here, national multimodal coordinated schedules are tantamount to preventing competition on its inception. They should be abolished altogether, as they relegate buses to a second position as feeders of trains, which makes sense in engineering and system consistency, but is a brutal attack on free market too, which we cannot tolerate.
I think we can easily tolerate it! This "free market" is not a person and has no human rights. Society and goverments are there for the people. Having a smooth running multi-modal regularly scheduled public transportation system is big benefit to a lot of people.

There could be some benefit in allowing long distance bus lines in Germany, just as Germany might have gained from having this prohibition. Would it have a clean, fast and comprehensive train network if that law never existed ? We should look at the positive and negative impacts this change might have. Not just say free market = GOOD, regulation = EVIL.

The article seems to suggest that there are only positive impacts.
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Old September 10th, 2010, 04:39 PM   #3
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As always, there won't be only positive impacts, that's for sure.
However, I think that long-distance coaches can provide additional services especially on connections where no direct train connections exist. And it will certainly result in price pressure on the rail operators.
Nevertheless, we won't see such an elaborate coach network like the ones of countries like Spain.
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Old September 10th, 2010, 04:52 PM   #4
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As always, there won't be only positive impacts, that's for sure.
However, I think that long-distance coaches can provide additional services especially on connections where no direct train connections exist. And it will certainly result in price pressure on the rail operators.
Nevertheless, we won't see such an elaborate coach network like the ones of countries like Spain.
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Old September 10th, 2010, 05:01 PM   #5
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Quote:
Originally Posted by thun View Post
As always, there won't be only positive impacts, that's for sure.
However, I think that long-distance coaches can provide additional services especially on connections where no direct train connections exist. And it will certainly result in price pressure on the rail operators.
Nevertheless, we won't see such an elaborate coach network like the ones of countries like Spain.
Spain had an abysmal rail transportation network under Franco regime, that never caught up with the Italian, French and let alone German ones: not widespread, slow, mostly non-electrified, and long neglected. When highways started being built in the late 80's, buses provided far better connections than many crap rail links.

Spain is far less dense than Germany too, hosting half the population (44 X 81 millions) in 140% of the area of Germany (505 X 362 thousand sq. km).
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Old September 10th, 2010, 05:03 PM   #6
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That's really sad!

It's the tip of the iceberg, believe me!
I've seen it in Argentina.

First they allow bus connecting cities that are not served by train directly, then they allow bus between cities that are connected by train. Then they close "unprofitable" passenger train lines.

Allowing buses now, the government is preparing arguments for closing cross-subsidised lines in a near future.

It will be like Spain, HSR or bus; less and less intercity.

I've seen it in Argentina 20 years ago.
This free market guy must have powerful friends.
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Old September 10th, 2010, 05:21 PM   #7
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Quote:
Originally Posted by Luli Pop View Post
That's really sad!

It's the tip of the iceberg, believe me!
I've seen it in Argentina.

First they allow bus connecting cities that are not served by train directly, then they allow bus between cities that are connected by train. Then they close "unprofitable" passenger train lines.

Allowing buses now, the government is preparing arguments for closing cross-subsidised lines in a near future.

It will be like Spain, HSR or bus; less and less intercity.

I've seen it in Argentina 20 years ago.
This free market guy must have powerful friends.
That would be a good outcome. I can tolerate (though not support) cross-subsidy in metropolitan and commuter lines (those catering mostly for compulsory house-workplace-house trips), but there is no justification for a Western developed country where almost every adult can afford to own a car to cross-subsidize train services.

If a train route has a too small ridership, it would have better being closed altogether if it can't stand competition from buses (!!!) that are slow, have to pay hefty fees and taxes embedded on road diesel prices, can't get over 100km/h and have to deal with regular traffic jams faced by cars due to underinvestment in highways. If given such favorable scenario a rail line can't still compete, better shut it down.

We have a nice precedent in Europe, indeed, two: Italy and UK. In UK, 40% of overall trackage was closed down in the 60's and early 70's to save money. Italy closed less in % terms (around 16%) but those 16% were more than 40% of non-electrified, single-track regional trackage that couldn't either cover its costs or provide enough of a feeder ridership to main lines.

Maybe it is time for Germany, the powerhouse of Europe and the most budget-conscious big country in EU, to take the lead on this.
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Old September 11th, 2010, 02:10 AM   #8
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>>> That would be a good outcome. I can tolerate (though not support)
>>> cross-subsidy in metropolitan and commuter lines (those catering mostly
>>> for compulsory house-workplace-house trips), but there is no
>>> justification for a Western developed country where almost every adult
>>> can afford to own a car to cross-subsidize train services.

Everyone can afford to own a car : 1) this is a myth. Lots of people own a
car only because they have no choice. But it makes such a dent in their
budget that they would gladly do without, if given the possibility. 2) many
people own a car simply because road trafic is so heavily subsidized by
governments. If road transport had to pay for all its real costs, it would
cost every car user 3 or 4 times more, and almost noone could afford it.
And we can even say that this means of transportation is heavily subsidized
by our children and grandchildren, who will be left to cleanup the mess
that we are creating now.

>>> If a train route has a too small ridership, it would have better being
>>> closed altogether if it can't stand competition from buses (!!!) that are
>>> slow, have to pay hefty fees and taxes embedded on road diesel prices,
>>> can't get over 100km/h and have to deal with regular traffic jams faced
>>> by cars due to underinvestment in highways. If given such favorable
>>> scenario a rail line can't still compete, better shut it down.

Buses do not pay enough taxes, far from that. They cost the states far more
than they are paying. Just for the wear and tear they are causing to roads :
This is proportional to the 4th power of the axle load. Do bus owners pay
taxes 10.000 times higher than car owners ? I don't think so. You, being
so much against cross-subsidizing, have a good opportunity to prove your
faith here : car owners cross-subsidize buses and lorries. Unfair !

>>> We have a nice precedent in Europe, indeed, two: Italy and UK. In UK,
>>> 40% of overall trackage was closed down in the 60's and early 70's to
>>> save money. Italy closed less in % terms (around 16%) but those 16%
>>> were more than 40% of non-electrified, single-track regional trackage
>>> that couldn't either cover its costs or provide enough of a feeder
>>> ridership to main lines.

You obviously haven't looked hard enough. All countries in Europe have seen
a drastic reduction of their rail network right after WW2. Belgium has lost
40% of its standard gauge network and almost all 5000 km of its metre-gauge
network. The same thing happened to all other countries, Germany included.
What you are calling for now has ALREADY happened. We sure don't beg
for a second wave.

>>> Maybe it is time for Germany, the powerhouse of Europe and the most
>>> budget-conscious big country in EU, to take the lead on this.

Please do us a favor : il you like the american way of life, just move over
there and enjoy. But don't expect many of us to follow you, and stop trying
to transform Europe into America-bis. Most of us have other aspirations.
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Old September 11th, 2010, 02:53 AM   #9
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Quote:
Originally Posted by MarcVD View Post
Everyone can afford to own a car : 1) this is a myth. Lots of people own a
car only because they have no choice. But it makes such a dent in their
budget that they would gladly do without, if given the possibility.
Most human beings like freebies. If they can buy, insure and run a car, they can afford it, even if they'd rather not buy it.

Quote:
2) many people own a car simply because road trafic is so heavily subsidized by governments. If road transport had to pay for all its real costs, it would
cost every car user 3 or 4 times more, and almost noone could afford it.
And we can even say that this means of transportation is heavily subsidized
by our children and grandchildren, who will be left to cleanup the mess
that we are creating now.
I don't bite the "externalities" bait. Technology advancement and innovation, much more of it - not less - will deliver us cars than run on renewable fuels and whose material can be almost 100% recycled.

Quote:
Buses do not pay enough taxes, far from that. They cost the states far more
than they are paying. Just for the wear and tear they are causing to roads :
This is proportional to the 4th power of the axle load. Do bus owners pay
taxes 10.000 times higher than car owners ? I don't think so. You, being
so much against cross-subsidizing, have a good opportunity to prove your
faith here : car owners cross-subsidize buses and lorries. Unfair !
Road pricing is tricky, though I favor a more fair approach to it. There are two major components: one, the wear and tear. The second one is lane space. I'm not sympathetic to any PT, I just like the idea of bus competition because it is a free market solution where one can be applied at expense of centralized planning, which is evil IMO (reminds my of quinquennial soviet-style plans).


Quote:
Please do us a favor : il you like the american way of life, just move over there and enjoy. But don't expect many of us to follow you, and stop trying to transform Europe into America-bis. Most of us have other aspirations.
Where? On SSC? We are all citizens. Fortunately, the silent majority is adopting American lifestyles in Europe (some aspects of it) more than the other way around in terms of housing and transportation. Car ownership and usage have never been so high in a country-specific basis. I'm happy with that.
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Old September 11th, 2010, 02:29 PM   #10
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Quote:
Originally Posted by MarcVD View Post
You obviously haven't looked hard enough. All countries in Europe have seen
a drastic reduction of their rail network right after WW2. Belgium has lost
40% of its standard gauge network and almost all 5000 km of its metre-gauge
network. The same thing happened to all other countries, Germany included.
What you are calling for now has ALREADY happened. We sure don't beg
for a second wave.
Switzerland is a notable exception here. Almost all railways every build are still operating there. Switzerland is one of the most competitive economies in the world. Amongst other things because of its great infrastructure.
I asume Switzerland is one of those countries Suburbanist has trouble tolerating.

One of the reasons why still so much rail operate is that a lot of it was never integrated in to the national system. A lot of local lines were (and still are) run by local companies to whom closure would have meant extinction. A lot more narrow gauge would have survived in Belgium if the lines had been owned by locally owned companies, in stead of the national NMVB... Belgium had it's own "greast streetcar conspiracy", and it was executed by the state.
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Old September 11th, 2010, 05:03 PM   #11
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Quote:
Originally Posted by Suburbanist View Post
Most human beings like freebies. If they can buy, insure and run a car, they can afford it, even if they'd rather not buy it.
A large part of the population is actually not able to drive a car. Either because they're to young, or to old, or to frail, handicapped, or blind.

Quote:
I don't bite the "externalities" bait. Technology advancement and innovation, much more of it - not less - will deliver us cars than run on renewable fuels and whose material can be almost 100% recycled.
There are other externalities. There is the constant road carnage.
I find it a bit strange (seeing your other posts) that you are OK with people operating a motor vehicle without background check, blood test and a full body orifice inspection.
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Old September 11th, 2010, 05:08 PM   #12
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Quote:
Originally Posted by Luli Pop View Post
First they allow bus connecting cities that are not served by train directly, then they allow bus between cities that are connected by train. Then they close "unprofitable" passenger train lines.
If a bus manages to steal market share from a railway than it is clear that the railway is not really offering a good service. The solution is not to force what the public apparently finds the better alternative of the market.
From what I know of the history of railway in Southern America they weren't exactly examples of good management.

As a counter example I give you the UK: There bus companies are free to compete with the railroads (and each other) as much as they wish. Nevertheless passenger numbers on the trains have soared.

Let bus companies serve the lower end of the market. I see no problem there. The biggest problem a properly run railway in Europe has nowadays are to many passengers, not a lack of passengers.
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Old September 12th, 2010, 12:24 AM   #13
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the more choices the consumer has... the fairer the system will be

I honestly have no idea how anyone can argue against this.
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Old September 12th, 2010, 12:41 AM   #14
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There has always been long distance buses in the UK.

The thing is, they are just awful. If you have no money then they are useful as the prices can be ridiculously low.

There are very few journeys that are quicker by bus than train, however some do exist, and these routes can be quite useful.

I was surprised when i couldnt get a bus in austria, because i expected it to be a cheaper alternative when i was a student.

They cater for different markets, DB has nothing to fear.

I was surprised when
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Old September 12th, 2010, 12:42 AM   #15
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Like K said, long-distance coaches exist in the UK and the railways are still just as crowded and fares just as high. If DB are doing things right(and from what I hear about the German rail network, they are), they have nothing to worry about.

And the Beeching Axe(assuming that's what you were referring to) actually is a horrible precedent for cutting rail services for the sake of profitability, seeing how the savings from it were minimal. The lines cut were mostly rural lines that were very cheap to run, and yet generated valuable feeder traffic for the main intercity and commuter routes. The only thing it effectively did was isolate many towns and villages.

The Axe is widely seen as a failure and a mistake, and several of the lines that were closed have since been rebuilt or reopened, with more on the way.
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Old September 12th, 2010, 01:06 AM   #16
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Quote:
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There has always been long distance buses in the UK.

The thing is, they are just awful. If you have no money then they are useful as the prices can be ridiculously low.

There are very few journeys that are quicker by bus than train, however some do exist, and these routes can be quite useful.

I was surprised when i couldnt get a bus in austria, because i expected it to be a cheaper alternative when i was a student.

They cater for different markets, DB has nothing to fear.

I was surprised when

Quote:
Originally Posted by Apoc89 View Post
Like K said, long-distance coaches exist in the UK and the railways are still just as crowded and fares just as high. If DB are doing things right(and from what I hear about the German rail network, they are), they have nothing to worry about.
That is the point! Let's competition roar. A side-effect (positive one, indeed) would be to abolish distance-based fares altogether (I know ICE don't have them anymore), as to make DB able to compete against buses by slashing prices in key routes, without this ridiculous policy of being obliged to, in some services, charge "fair fares" according to distance only.

We'll see DB extracting more money from whom it cans and forced to low prices where competition is more fierce. It will not bankrupt, but it might be forced to adopt a less outdated pricing strategy at least.

Quote:
And the Beeching Axe(assuming that's what you were referring to) actually is a horrible precedent for cutting rail services for the sake of profitability, seeing how the savings from it were minimal. The lines cut were mostly rural lines that were very cheap to run, and yet generated valuable feeder traffic for the main intercity and commuter routes. The only thing it effectively did was isolate many towns and villages.

The Axe is widely seen as a failure and a mistake, and several of the lines that were closed have since been rebuilt or reopened, with more on the way.
The Beeching Axe was a visionary measure in which people would be feed by bus until the main lines, AFAIK. Rural lines were only cheap to run because they lack modern stuff like electrification, ATC etc. Some of them used staff-only traffic control (e.g., no in-cab, no block system, not at all, you miss your radio com, you crash your train).

It would, if fully completed, left Britain with a set of core routes in which it could throw all the money needed to improve, electrify, modernize and also build new high-speed corridors. Nice roads would connect major stations and transfer points in the main lines to these towns and villages. A pity (just my opinion) Beeching Axe II was never completed, and a pity Margaret Thatcher didn't have the guts to do it like she did with so many (by then) outdated British industries like mining or telecom.

But I'll try to find a thread on Beeching Axe, I'm sure there is an old one about that. Quite interesting policies of UK for transport back then.
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Old September 12th, 2010, 04:22 AM   #17
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Originally Posted by Suburbanist View Post
That is the point! Let's competition roar. A side-effect (positive one, indeed) would be to abolish distance-based fares altogether (I know ICE don't have them anymore), as to make DB able to compete against buses by slashing prices in key routes, without this ridiculous policy of being obliged to, in some services, charge "fair fares" according to distance only.
My point is that there is no competition. Long-distance buses and trains serve completely different markets, with trains being for those who need speed and/or comfort, while buses serve those who want to save money at any cost. It's like comparing a Kia to a Mercedes.

Quote:
The Beeching Axe was a visionary measure in which people would be feed by bus until the main lines, AFAIK.
Except the replacement buses quickly failed because they could not match the speed and comfort of a train.

Quote:
Rural lines were only cheap to run because they lack modern stuff like electrification, ATC etc. Some of them used staff-only traffic control (e.g., no in-cab, no block system, not at all, you miss your radio com, you crash your train).
And what's wrong with such a simple system for branch lines that are only served by a few tiny trains? It's perfectly sensible, and installing advanced equipment that only really benefits high-speed high-capacity lines is just pointless waste. You wouldn't build a six-lane motorway to a village of a few thousands, and likewise you wouldn't do the equivalent with a railway. As with any mode of transport, infrastructure is kept at a level appropriate for the traffic served.

Besides, in the 1960s electrification over the whole UK was still in its early stages and ATC didn't exist outside of a few simple electronic warning systems.

I think the saddest loss to the Beeching Axe was that of the Great Central Main Line: A nearly completely grade-seperated, high-speed railway built to the continental loading gauge in anticipation of a Channel Tunnel that came 30 years too late.
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Old September 13th, 2010, 11:31 AM   #18
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Quote:
Originally Posted by JeroenMostert View Post
I think we can easily tolerate it! This "free market" is not a person and has no human rights. Society and goverments are there for the people. Having a smooth running multi-modal regularly scheduled public transportation system is big benefit to a lot of people.

There could be some benefit in allowing long distance bus lines in Germany, just as Germany might have gained from having this prohibition. Would it have a clean, fast and comprehensive train network if that law never existed ? We should look at the positive and negative impacts this change might have. Not just say free market = GOOD, regulation = EVIL.

The article seems to suggest that there are only positive impacts.
Well - since most of Germany's neighbors never had this law on the books, but still have:
A. A clean, fast and comprehensive train network, while:
B. Companies offering longer-range bus services lead a rather marginal existence there,
I'd say that this is a bit of a non-issue. Sounds a bit like a law forbidding people to hop over distances longer than 100 km. A bit silly, but since no one is actually hopping to cross distances like that it doesn't actually affect anyone, so who cares?
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Old September 13th, 2010, 04:34 PM   #19
wonwiin
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DB is one of the largest bus operators in Germany. They already have experience in international long distance busses. So if long distance busses are allowed in Germany DB will propably be one of the biggest operators.
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Old September 13th, 2010, 05:01 PM   #20
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Quote:
Originally Posted by Apoc89 View Post
I think the saddest loss to the Beeching Axe was that of the Great Central Main Line: A nearly completely grade-seperated, high-speed railway built to the continental loading gauge in anticipation of a Channel Tunnel that came 30 years too late.
And it was closed not because it was unprofitable or underutilised. It was closed because of rivalry between different BR sectors dat dated from the time before the nationalisation.
If the Great Central had been allowed to exist as an independent company things would have been quite differently.
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