In the face of increased competition on core routes, local authority-owned Cardiff Bus is setting up a new low-cost operation. Rhodri Clark reports

 

cardiffbusOne of Cardiff Bus’s older vehicles. A candidate for the VBL fleet?

 

 Cardiff Bus is preparing to transfer some of its services to a sister company which will have lower operating costs. The vehicles of Vale Busline Ltd
(VBL) will carry a different livery from the Cardiff Bus fleet but will operate from the same depot south west of the city centre.

One industry source said Cardiff Bus and its owner, Cardiff council, would not be embarking on this course without taking “extreme legal advice”. The operator was severely censured by the competition authorities for its predatory conduct in 2004 and 2005 when it operated no-frills services on the same routes as new competitor 2Travel, which subsequently became insolvent.

Competition in the Welsh capital intensified last May, when local independent New Adventure Travel launched a high-frequency, cross-city service. NAT recently began a second commercial service linking the city centre and Newport Road to the eastern suburbs. Cardiff Bus has also seen significant competition in the northern suburbs, through which Stagecoach services pass as they travel in from the outlying valleys.

VBL will initially focus on cutting the operating costs of its loss-making suburban routes. Passenger Transport understands that VBL is likely to recruit staff on different terms and conditions from those applying to Cardiff Bus staff.

VBL has been registered with Companies House for some years but lain dormant. It has the same directors and non-executive directors as Cardiff Bus. It has now received authorisation from the Traffic Commissioner to operate 20 vehicles from the Cardiff Bus depot in Sloper Road.

Councillor Ben Thomas, chairman of Cardiff Bus, was unable to say how the terms and conditions and pension arrangements for VBL staff would differ from those of Cardiff Bus. He said the decision to activate VBL was a response to Cardiff Bus losing passengers for a variety of reasons, including the closure of the city’s bus station, increased competition and bad weather. He said that some of Cardiff Bus’ old vehicles would be transferred to VBL instead of being sold or used for spares, and would be deployed on routes with low passenger footfall.

The industry source said there was a strike at Cardiff Bus last year. “If you look at their terms and conditions, they’re pretty restricted. They don’t give change on the bus.

“It sounds as if they [Cardiff Bus] are trying to put a lower-cost operation out on the road to compete against NAT, but don’t forget that Cardiff got stung by the Competition Commission for the way they responded to 2Travel. They should tread really carefully. They would have taken extreme legal advice about this and not done it lightly.

“In order to compete on a like-for-like basis and not be accused of using their might and weight to smash the opposition, setting up a low-cost company would be one way they could potentially do it.

 

The full story appears inside the latest issue of Passenger Transport.

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