Some would say it’s poor taste to pass judgment on competitors’ services and pricing plans but we cannot sit idly by and watch our competitors flood our route with cheap buses whilst putting prices up everywhere else to pay for it all. Yesterday afternoon our competitors announced bus fare increases on all services… except the ones that compete with ours. And this is after prices on competing service were reduced substantially in January to match our cheap fares.
From 18th September a day return bought on the bus on most city routes will be £4. However on the 23 and 25 services that compete with ours along the Lewes Road it’s just £2.50. Brighton & Hove Bus Company’s website blames the rise on the price of diesel and the expiry of their fixed-price fuel deal. But is diesel cheaper on the Lewes Road than everywhere else? Of course not.
Also announced are increased frequencies on the 25 services, so that at the busiest times there will be a 25 bus every 3 minutes. This means that frequencies at these times have been increased by 67% whilst the price of a day Saver on this route has dropped 32%. And in order to pay for this, everyone else in the city has been given an 8% increase.
The Big Lemon was initially proud to see that competition on the Lewes Road was proving good for passengers, with increased frequencies and better deals on all the buses, whatever colour they were. However now it’s gone a step too far as it’s clearly hurting bus users in other parts of the city. Why should someone on a Number 1 bus pay 60% more for a day return than someone on a Number 25 bus?
In a recent market study, the Competition Commission concluded that “there are features of local markets for the supply of local bus services which in combination prevent, restrict or distort competition.” (http://bit.ly/nepdp6) Interestingly, the possible remedies include ideas to limit the extent to which dominant operators can change prices and frequencies following the entry of a rival (http://bit.ly/ohpKrI). Even according to existing legislation (Competition Act 1998) it is illegal to engage in predatory pricing (which occurs when a dominant company sustains losses in the short run in order to eliminate a competitor). Obviously we have no idea whether or not these conditions are met on the 23 and 25 services, but in any case it is clearly ludicrous to claim that £2.50 per passenger per day is sufficient on two routes but £3.70 on every other route is not enough. The only possible explanation is that it is all designed to eliminate us from the route, and that is something that we simply cannot allow to happen.