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Is the Coastal Pacific Really Losing Money?

The Coastal Pacific is KiwiRail’s scenic rail service that operates both ways between Picton and Christchurch on a daily basis.

In 2011 it had a major revamp, with new carriages featuring panoramic windows like the one below as well as a new café car.

CoastalPacific

 

However, last week KiwiRail announced that the Coastal Pacific scenic rail service between Picton and Christchurch was moving to a seasonal timetable, and would not be operating from 6th May to 26th September:

“The Coastal Pacific is losing almost $3 million annually, due in most part to a significant drop in the tourism and domestic travel market to and from Christchurch after the earthquake. These losses are highest through winter,” says KiwiRail’s General Manager, Passenger, Deborah Hume.

“Winter demand for KiwiRail Scenic’s long distance passenger services (May through September) is much slower than the summer tourist season. For the Coastal Pacific service, the drop in demand in these winter months is even more pronounced than the TranzAlpine, as this train serves a less well known and travelled route. Added to this, since the February 2011 Christchurch Earthquake, travel to and from the city has dropped significantly due to the loss of tourist related facilities and accommodation.

“Very low numbers of people used the train during last winter, although there was an increase during the school holidays. However, KiwiRail needs to sell 130 seats on each service to break even, and on some days only 30 people were on board.

To be losing three million dollars a year seems like a staggering amount, but it isn’t clear from the press release which costs are direct costs and which costs are contributions to KiwiRail’s fixed costs such as track access fees.

The management and cost accountants among you will know that as long as revenue from the service is covering the direct costs of operation and is therefore making a contribution to overheads, then in the short term it is viable for the service to continue.

Suspecting a significant amount of the claimed “loss” was in fact fixed cost charging,  I asked KiwiRail if they could provide a bit more detail, which they have done:

TOTAL REVENUE                    3,404,925
EXPENDITURE

  • People Related Expenses     403,429
  • External Services                    302,441
  • Lease and Rentals                   42,715
  • Materials & Supplies              248,754
  • Incidents, Casualties & Insurance 6,051
  • Other Expenses                       86,225
  • Track Access                            790,144
  • Hook & Tow                              2,349,051
  • Mechanical                              798,662
  • Corporate Overheads           216,481
  • Allocated Costs (Including insurance, marketing, finance and administration, HR, management, website, general operational expenditure etc)    1,183,908

TOTAL EXPENDITURE         6,427,860

EBITDA        -3,022,935

There still isn’t absolute clarity about which of these expenses are fixed cost charges imposed by Kiwirail, but the internal charges that really stand out though are the “Hook & Tow” of $2.3m, the “Allocated Costs” of $1.2m and the “Track Access” fee of $790K.  Combined, these transfer charges add up to $4.3 million and so are the major reason why the Coastal Pacific is “losing” $3m. (That figure of $3.4m in revenue from the service must be very pleasing for KiwiRail, by the way.)

From what I understand Hook and Tow is a cost recovery for the use of the locomotives that haul the scenic carriages. This seems excessive when the cost of a brand new diesel locomotive is just $4m.  Presumably there is a distance based charging formula involved here, and also possibly a salary component for the engineer.

Track access fees seem high, but then it is a relatively long stretch between Picton and Christchurch, and there are fewer services to spread the cost over.  As for “Allocated Costs” it isn’t clear if these are direct costs that relate to the operation of the service or if they are simply a contribution to head office expenses.

For comparison, someone has helpfully pointed out the projected costs of the Capital Connection for 2013/14 on the Better Transport forum:

  • Hook and Tow – $843,028
  • Track Access – $219,924
  • Mechanical Costs – $368,640 (I presume this is for the carriages and genset van)
  • Allocated Costs – $357,502
  • Labour – $305,903

These figures were sourced from page 33 of this Greater Wellington Regional Council document.

Obviously the Capital Connection and the Coastal Pacific services are very different, but you do have to wonder about KiwiRail’s internal charging formulae.   Presumably the Coastal Pacific won’t be required to make a fixed cost contribution during the period that the service isn’t running. It would be interesting to know if the freight services have to pick up the track access fee to compensate over winter.

This isn’t to say that the decision to cut the Coastal Pacific during the winter months was the wrong one (and obviously Kiwirail have access to the needed marginal direct cost data to make the call), but to blame a drop in tourism for a loss of $3m seems the wrong thing to be putting in a press release, as it feeds the public perception that regional rail can never be “profitable” in New Zealand.

 

46 comments to Is the Coastal Pacific Really Losing Money?

  • Mr Anderson

    Watch as this move leads to declines in Tranz Alpine patronage and an even steeper drop in Coastal Pacific patronage as we enter the death spiral.

  • The current board and senior management of KR appear to be dismantling the nation’s rail system as quickly as is politically expedient. Their favoured tool is shown above, using all their creativity to frame as many services as financially underperforming as a pretext to cancellation. The aim looks like to leave a small rump of freight services basically run by dispatchers at Fonterra [and some other big clients]. This is a disaster for the nation, a wasted and abandoned resource of considerable value that we will increasingly need this century as the world moves from hydrocarbon to electron driven transport systems.

    Listening to Jim Quinn talk on a radio interview you’d have thought he was the representative of the trucking lobby; he had nothing but reasons why rail cant work, no energy or apparent interest in thinking differently about this asset. He sounded like a totally visionless cost accountant from the receivers determined to wind it all down not someone with either the interest or creativity to make it work. Inevitably arguing that the patient must be bleed and have more and amputations in order to be ‘saved’. Yeah right.

    Fantastic for mountain biking bankers on gardening leave though- think of all those cycling rail trails!

  • Wai

    The problem are the overhead costs, which are not cut at all. But what they cut are the contribution margins by closing more and more lines and services. Thus less services have to cover more and more overheads (see e.g. Track Charges). Let’s face it, KiwiRail in its current condition is due to total shutdown within a few years.

  • Wouldn’t winter be when the scenery is at its best, like in the photo above.

    • Dave Smith

      Think a lot of Northern Hemisphere tourists like their summer :) If they want those sort of views they go to Swiss Alps in winter for a fraction of the cost and better quality.

      The marketing of longer distance rail journeys in this country is a bit average to be honest, but seems to have improved greatly since dirty old TranzRail. The Northern Explorer for example could do well with the ski set if it offered a decent package http://www.kiwirailscenic.co.nz/scenic-escapes/chateau-tongariro-two-nighter/

      But yes – looks like they are trying to make KR a simple freight company on a few main routes. Who needs privatisation when you can just close it down quarter by quarter?

      • tuktuk

        Switzerland heavily subsidises their rail network through a range of channels and that includes the famous Glacier Express which the new Kiwirail AK carriages appear to be inspired by. Arguably, the most important subsidies are the constant government/EU funded infrastructure upgrades. Even Ireland, with very similar population and terrain to New Zealand, is a much higher speed passenger railway.

        With even just a modest improvement in journey times and overall timekeeping, costs would drop, passenger numbers would dramatically increase, and those passenger trains will do a much better job of covering their direct operating costs, and contributing to both local communities and the national tourism product.

        For the Christchurch – Picton rail link, the elephant in the room is Clifford Bay, and persistent rumours that the new ferry terminal will not be rail served. The costs published for track fees for the Coastal Pacific indicate that the rail corridor is relatively high cost, and vulnerable. This corridor needs more trains, not less.

        I wonder if an out and back day return tourism trip between Picton to Blenheim and Kaikoura could work? Such a service departing at 11.30am could connect with the 8am Kaitaki sailing. It would need to return to Picton by 6pm to allow passengers to return on the 6.30pm Aratere. Such a venture would deal with the Christchurch accommodation issue by using Wellington as the home base instead.

        • It’s interesting you are speculating the new ferry terminal would not be rail served. I speculated the same, and all the rail enthusiasts told me the Government had no choice but to put in the rail link. But there is still no rail link to Marsden Point and the North Auckland Line has become unviable with most of its freight lost to road. Rail freight after all could still go to Picton and go on the Aratere to Wellington, albeit with a time penalty, but these days no one dares to suggest that rail should carry time sensitive freight. I was even told that the ferries aren’t part of the turnaround plan, but it’s very obvious that they are. When you have a situation where Kiwirail itself is suggesting they can transship from rail to road at the ferry terminal, so that they don’t need a new rail ferry, coupled with this Governnment’s obvious enthusiasm for roads, then it doesn’t take much forethought to see that Kiwirail can probably get by with transporting the containers between the ferry terminal and a railhead directly alongside the Main North Line. They certainly didn’t make any effort to capture the freight to Marsden Point, did they.

      • Steve D

        With 10,000 people on the slopes on many weekends, mostly from Auckland and Wellington, and with both ski towns right on the main trunk, you’d think there’d be enough demand for a weekend train. A sleeper would be brilliant – you could go out on Friday night, get on the train at midnightish and be up in the morning to hit the hill. Even if not, KiwiRail now has a bunch of spare carriages from the Coastal Pacific, conveniently available in the winter.

        Then again, the old Northerner night train used to offer exactly that service, but it still got canned.

  • Jon Reeves

    I had some hopes after meeting Jim Quinn on a number of occassions. However, actions are louder than words. I will not blsne him however. Remember it is the National Govt who has given him and Dr. Deb Hume the sharp end of the stick!!!!

    If you want better rail, get rid of Gerry, Joyce and the Smiling Assasin – JK.

    Until they are voted out, question KR loudly as they attempt to ruin NZ Inc’s rail system.

  • JohnP

    How is it that the Coastal Pacific costs three times as much as the Capital Connection? Seems a bit odd.

    • Ross Clark

      The Capital Connection travels about 150 miles in a day, there and back; the Coastal Pacific travels about 400 miles in a day, there and back.

  • It also makes you wonder and worry about just how much Kiwirail are charging Auckland Transport for the locomotives that they lease to haul around our trains currently. The EMUs are likely to see substantial reductions in the operating costs of Aucklands PT networks.

  • Does Hook and Tow include fuel costs?

    Disclaimer, I do that ferry/rail linked trip as often as I can when travelling home from the North Island. It’s magnificant at any time of year, and the combined off season package udes to be very reasonable. Going in the other direction is a bit of a pain owing to the very early start, and the difficulty of getting to the Chch station.

  • The locomotives and drivers are hired from KiwiRail Freight. Like all hire charges, it includes a profit for the hire provider. It is not an internal charge done at cost. It is one company hiring equipment and staff from another company, at commercial rates.

    When Tranz Scenic was privately owned, they owned their own locomotives, so were able to use them at cost. When Toll bought back Tranz Scenic, they divested the company of all the locomotives, “selling” them to Freight. The cost of running trains has been very high ever since.

    • ErrolC

      I assume that ‘Hook and Tow’ is effectively loco hire, including crew and associated costs. If Kiwirail have other uses for the locos, full commercial rates may even be justified. Isn’t there a shortage of crew

    • ErrolC

      I assume that ‘Hook and Tow’ is effectively loco hire, including crew and associated costs. If Kiwirail have other uses for the locos, full commercial rates may even be justified. Isn’t there a shortage of crew?

      • It makes no sense for one branch of the SAME organisation to charge full commercial rates to another branch. These transactions are just paper shuffling after all. They are being used to justify a claim of money losing but it is not actually true. It is all the same organisation that is running both types of train. These internal transactions can be for any amount Kiwirail wants to set and they would be best to set them at cost because the locomotive is still going to be depreciated whether it is on that train or not. If you justified that the passenger operation requires extra locomotives that aren’t being used the rest of the time then you might just be able to justify this stance but otherwise it is pretty indefensible.

    • Logically then, if you were charged with making a profit on the Coastal Pacific, you would be asking KiwiRail freight to cut their rates and to offer newer locomotives while they were at it. Either that or go and buy your own locomotives. Must be frustrating to not be able to do that.

      • Tranz Scenic 2001 Ltd (the private company) had their own locomotives and drivers, so they didn’t have to pay anyone commercially-orientated hire rates. When Toll Rail bought out TS 2001 Ltd, they re-employed all of the locomotives and drivers to freight, forcing the passenger business to then have to hire both the locos and drivers back, at more than twice the cost of when they had them themselves. The same approach is taken by KiwiRail to this day, and it will never change for as long as the passenger trains are operated by a freight company. Not even a change of government will make a difference.

  • Peter H

    Bit off subject, from post done last year, can someone explain What “Rail rolling stock capital servicing charges” means.

    Some costs, such as rail rolling stock capital servicing charges, station and bus stop facilities maintenance, and the Total Mobility scheme, are not included.
    http://transportblog.co.nz/2012/10/10/improving-our-farebox-recovery/#comments

  • Sailor Boy

    And I am sure that SH1 along that route makes a huge profit. Shall we shut that down too?

  • Liz

    I think that they announce that they need more patronage, and offer discounted tickets for this winter to see if they can raise the patronage numbers.. it’s worth a try.

  • Kris

    It is typical Kiwirail creative accounting.

    I suspect that a fair chunk of the freight costs have been charged to Kiwirail Passenger, hence the higher operating costs.

    I must admit that the Coastal Pacific has competition from the many bus operators (ranging from 1st tier like InterCity and Naked Bus done to the 15th tier) that ply the Christchurch/Kaikoura/Picton route.

    I have have a feeling the writing is on the wall that the Coastal Pacific train will disappear in the next 3 to 5 years, as Kiiwrail decides on the fate of the Christchurch to Picton rail link.

    Toll NZ had indicated in 2006 or 2007, that the route was not suited to the newer containers due to the tunnels being to small and some serious work had need to be done removing some of them, turning some tunnels into cuttings for the newer containers and wagons.

    Tuktuk comment “For the Christchurch – Picton rail link, the elephant in the room is Clifford Bay, and persistent rumours that the new ferry terminal will not be rail served.” re-enforces Tolls NZ comments.

    Yet, the really is, the Coastal Pacific is an important part of of the passenger rail link from Auckland to Christchurch and connecting scenic bus services from Christchurch to Mt Cook and Queenstown, especially that Queenstown is becoming a major international arrivals gateway for international tourism.

    Unfortunately, Kiwirail Passenger marketing is still conservative and they are still not looking past the end of their noises, especially getting out there to market the Coastal Pacific importance as a tourism transport that is unique.

    Kiwirail Passenger marketing have said, that there is not enough accommodation in Christchurch, yet in the last 6 months that 3 hotels have re-opened with 2 more due to open boosting beds nights which is more compared to last year when the Coastal Pacific was operating 4 days a week during winter, experience has show, there are tourist both in summer and winter who prefer to travel by train especially the train/ferry service between Wellington/Kaikoura/Christchurch as oppose to travelling by bus.

    By suspending the Coastal Pacific for 4 months plays right into Kiwirail competitors and it makes it harder to bring back the customers once the service resumes.

    The reality is, you can not mess with the international tourism market, as this market needs consistency due to its long lead in times.

    Kiwirail does offer special promotional fares for the domestic market but they will not offer special ‘Winter’ wholesale fares to their global wholesale distribution channels despite the fact they say that the 3 trains are ‘Tourism’ trains for international tourists.

    I believe that Coastal Pacific can operate on a reduce winter schedule like last year, by keeping the ‘tourism’ rail link from Auckland to Christchurch intact, as it feeds into the TranzAlpine, with some clever marketing, which Kiwirail Passenger is not good at doing.

    What Kiwirail Passenger needs to do, is to work with its international wholesale distribution channels and retail web sales channels, do some co-sharing of bus services with scenic bus operators on the Christchurch to Mt Cook and Queenstown route in a winter service that includes skiing at Whakapapa (Northern Explorer), Mt Lyford (Kaikoura), Mt Hutt (Christchurch) and Coronet Peak/The Remarkables (Queenstown) plus include the the TranzAlpine on a day excursion or for the non snow bunnies a winter travel experience, targeting the key markets of Australia, Tahiti, Noumea, Singapore, Hong Kong, China, Taiwan, Malaysia and India being the closest tourism markets to NZ for the winter period.

  • Good analysis Camreon. I think how KiwiRail calculates these costs is in need of questioning. Losing the Coastal Pacific is sad and I think is a very poor decision. We have no evidence to suggest whether there has been government intervention, or whether it is just bad, ideological management.

  • Ross Clark

    Some thoughts here:

    * the important thing is the share of costs which can be properly classified as ‘variable’ w.r.t the number of services run. ‘Hook & tow’ and ‘mechanical’ are the only two line-items which would be saved by not running the train, and they sum to less than the revenue. I know, from having been the Scenic business analyst in another life, that most of the other costs will keep going. Most track costs are fixed in the short- and even the medium-term – you need about the same level of maintenance for track, whether you are running two trains a day or two hundred.

    * Over the longer-term railways are vulnerable to this sort of thing because such a high share of their cost base is fixed. We used to joke that an elephant “is only a mouse which has been built to a railway specification”. The only way you save lots of money in a railway is by shutting a whole line down, and I know that this was being /seriously/ looked at in Michael Beard’s time. Bus costs are completely variable in the long-term and significantly variable in the short-term, and quite a bit more scaleable w.r.t. traffic demand.

    * The advised break-even of 130 passengers or so, would seem about right (a load factor of 65 percent, assuming a 200-seat/five carriage consist).

    * Tourist flows at this time of year are quite thin – in the past, when I had wanted to head north out of Christchurch during the day and not at 0700, there was no choice except an Intercity bus at 1500. It’s better during the summer, but not much better, and the Wellington-CHC locals’ traffic is far more likely to fly than get a ferry and train.

    • Kris

      My research shows, that the local market for the Wellington/Christchurch train/ferry service is from Auckland/Hamilton/Tauranga region, as it is a connection to the Northern Explorer train.

      it is mostly retiring or retired baby boomers who use the service.

      With regards to the international market, it is the Asian, Canadian, USA markets Wellington or Picton to Christchurch and the Australian market Christchurch to Picton or Wellington during the winter period.

      Your a right, about the locals who live in a radius of New Plymouth, Whanganui, Napier/Hastings, Palmerston North and wellington will fly Wellington to Christchurch, being the cheaper options especially with fares from $39.00 per adult.

      With regards to your comment about the load/break even factor, Kiwirail Passenger have adjusted fares based on historic loadings and current costings for the revamped service, so, in theory, on a reduce winter timetable, the Coastal Pacific would break even, with profit during the summer period.

      But it comes back to the fact, Kiwirail Passenger is not putting alot of effort in promoting the Coastal Pacific compared to the TranzAlpine and the Northern Explorer trains.

      I still think there is a hidden agenda, that Kiwirail is planning to close the Christchurch to Picton rail link once Clifford Bay is operational, as oppose to invest heavily in the upgrade for the line to meet new freight shipping requirements.

      There also has been rumors about Kiwirail operating Wellington to Christchurch freight/passenger services using bigger ferries similar to the Kaitaki, as the Arahura will be at the end of her economical life in 8-10years, meaning a replacement will be necessary. In fact Kiwirail is looking for a replacement now.

      I believe Toll NZ did look at the possibility of using the Kaitaki when she entered service on the Wellington to Christchurch run.

      • Ross Clark

        Not sure I follow you; if Clifford Bay is completed, you mean that they would close the line between there and Picton?

        During Michael Beard’s time, it was the /whole/ line they wanted to close, and inter-island freight would have been kept on trucks, to either Picton or Lyttelton. Pacifica work the Wellington-to-Lyttleton sector for freight already (it’s far too long for passenger journeys). The general view was, and no doubt still is, that Inter-island Line can make far more from carrying trucks than railway wagons.

        • Kris

          Apparently thats the plan to close the Blenheim to Picton rail link once Clifford Bay was operational due to the nature of the line and also, who will be using it other a passenger train service.

          I agree with you, that Micheal Beard stated the whole line Christchurch to Picton was on the list to close due to the cost of upgrading the line from Clifford Bay to Christchurch to meet new containers and wagons and to use trucks from Clifford Bay to Christchurch.

          At time, Toll NZ looked at the cost of operating the Kaitaki on Christchurch to Christchurch (Lyttleton) using Wellington as the northern rail freight hub and Lyttleton as the southern rail freight hub. Also Lyttleton has fuel facilities for the Kaitaki.

          I believe the Road Transport forum supported the concept of using large ferries like the Kaitaki between Wellington and Christchurch, saving in costs for trucks going up and down the Hundalee’s on the State Hwy1 between kaikoura and Hundalee.

          If trucks where used from Clifford Bay to Christchurch, the Government would have to spend alot of money upgrading State Hwy 1 from Clifford Bay to Cheviot for the extra truck traffic especially with the new axle loads by resolving the issue of the ups and downs of the Hundalee’s.

          For which is the cheapest option for Kiwirail -

          - Operating large ferries between Wellington and Lyttleton

          - Building Clifford Bay and upgrading the rail link between Clifford Bay to Christchurch

          - Kiwirail building Clifford Bay and the Government pays for the upgrade of State Hwy 1 between Clifford Bay and Cheviot

          Know how cash strap Kiwirail is, the ferry option is the cheapest especially with the rebuild of Lyttleton port facilities.

          The other factor that has taken into account, all large freight/car/passenger ferries built globally after 1990, are not rail equipped and there is cost of converting them for rail use, which Kiwirail will have to pay for.

          Bluebridge hasn’t made it mind what it wants to do since it is not included in of the Clifford Bay plan.

          They have been thinking of operating the new Straitsman between Wellington and Lyttleton as freight/passenger service with the St Reigna on the Wellington to Picton to cater for freight to Nelson and the west coast plus passenger/cars to/from Picton.

          At the moment Bluebridge is committed to services between Wellington and Picton, due to their investment into their Picton freight terminal.

          Both the Straitman and the Kaitaki have passenger cabins for overnight services.

          As I said, the writing is on the wall for the Coastal Pacific, as Kiwirail starts a gradual reduction of the service.

          • “The other factor that has taken into account, all large freight/car/passenger ferries built globally after 1990, are not rail equipped and there is cost of converting them for rail use”

            Is that so? I’ve used a couple of rail equipped ferries in Scandanavia in the last few years (including one that carried a Deutsch Bahn ICE!), I couldn’t say if they were pre 1990 or not but surely there is a fairly large market for off the shelf rail capable ferries.

          • Kris

            No there isn’t.

            Rail capable large ferries are custom built which would be expensive for the cash strap Kiwirail.

            Kiwirail would go for near new ferries (5-10 years) like the Kaitaki, that are still under warranty but have gone through the initial in service teething troubles, possibility on a long lease like with the Kaitaki.

          • Ross Clark

            Indeed, even if Clifford Bay was made available to Bluebridge, they still might prefer to go through Picton, making the cruise through the Marlborough Sounds their USP.

            When I joined Tranz Rail as-was, longer ago than I care to think now, my first job for them was as the business analyst for the “commercial vehicles” part of Inter-island Line – monitoring the trucks business on our own ferries, watching the competition’s freight ferries, and trying to stay onside with our rail freight colleagues – we were sometimes seen as ‘taking “their” business’. What became clear, after a while, was that the market was shifting away from producing things which were better suited to rail freight, and more of the traffic was a better fit for truck as opposed to rail freight. One number we quoted a lot, was that it took eight hours from when a rail wagon got to Wellington, to when it got off the ferry at Picton and could be sent on its way; the equivalent time requirement for the trucks was four hours, because of far-reduced marshalling requirements. For too many markets rail wasn’t time-competitive.

          • Kris

            You are correct about Bluebridge staying in Picton.

            They are quite happy to stay there for a while.

            To much money has been on developing their terminal at Picton.

      • Suggesting Christchurch-Wellington services could be viable again ignores the history lesson learned when the Picton rail ferries first began operating. Within 15 years the overnight ferry service disappeared completely. The simple fact is that a 12 hour run overnight is too slow compared with a drive of not more than 5 hours, maybe less, and a ferry trip of three 1/2. There is also a competing ferry operator just looking for an opportunity to cream the road freight market..

        • Ross Clark

          This file has some useful assessments of the inter-island freight market:

          http://www.nzta.govt.nz/resources/research/reports/497/docs/497.pdf

          • tuktuk

            Interesting document there on the inter-island freight market.
            Not too many surprises in the overall findings – shipping the most fuel efficient, followed by rail, with trucks a long way behind.

            A couple of comments.

            The rail figure assumes diesel locomotives – DX or DC rather than electrics through the central North Island, or more modern diesels. This distinction is important especially for the electrics given that at 3am in the morning, a locomotive powering up onto the central volcanic plateau should be using a modest amount of renewable hydro or wind power, all at off-peak rates. Whether that happens in reality, especially the pricing side of things might be a different story.

            Note also the focus on containerised goods for the study which I think provides the clue to what the competitive threats are for Christchurch-Picton, or Clifford Bay rail corridor. The threat comes from overseas container ships crewed by foreign crews dumping capacity onto the local market serving the high traffic end-points of the freight corridors – ie Auckland, Tauranga and Lyttelton. I see the government has made moves today to try to break up international shipping conferences serving NZ.

            As for Wellington-Lyttelton, the study itself noted that Pacifica had ceased operating its freight service for trucks. If the objective is to carry trucks and payload, or trains and payload, history has shown the shorter the marine transit corridor the better. Containers are the game changer that make end point-to-end point shipping economic because they are very modular and moveable, yet incredibly space efficient.

            Looking at the Coastal Pacific train, the clanger is still those hook and tow costs. It would be interesting to see how they have been calculated.

      • Kaitaki only has a few cabins. It would have to be converted to have enough cabins to take a similar number of passengers overnight.

  • Peter H

    Thanks greenwelly
    I have another two questions. from this post
    http://transportblog.co.nz/2010/06/11/50-farebox-recovery-policy-a-joke-and-nzta-know-it/#comments
    If “rail rolling stock capital servicing charges” are not included in fare box recovery. does this give a advantage to cities with electrified rail services.
    And I see Canterbury had good farebox recovery, does anyone know if it continued to improve until the earth quake or did they find the limits of continuing cutting cost.
    http://www.stuff.co.nz/national/4362202/Police-take-28-Christchurch-buses-off-the-road

  • Gian

    I wonder if the management is going to get a pay cut in winter because they have to take care of less trains…

  • Dave

    Something which really annoys me is the repated claim by KiwiRail management that “Passenger bookings on the Coastal Pacific plummeted after the Feb 22 2011 Christchurch earthquake”. The reality is that the train never ran following the eartquake. The decision was made to suspend the service until August, refund any bookings already made, and turn away any new ones. This was at a time when the Chilean volcanic ash-cloud caused domestic flights to be suspended and Christchurch-Picton bus services were frequently booked out. Where was KiwiRail’s stable and reassuring presence when it was needed? Absent!, and on a dishonest pretext. It would have been more truthful to have said that “because bookings were down on the Tranz Alpine (which was restored soon after the eartquake), the decsion was taken to suspend the Coastal Pacific”. As it is, we will never know how this service might have performed during that hour of need.

    I wonder also, what long-term damage was done to the service’s patronage base and public image by this cowardly retreat. Also what opportunities were lost to demonstrate KiwiRail’s dedication and commitment. I wonder too, what part this has had to play in the ailing fortunes of the service since.

    • Kris

      You are right, each time the Coastal Pacific train service is suspended, it does undermind the creditability of the service, especially the international tourism market and plays into the hands of the bus operators who ply the Christchurch to Picton route.

      The Coastal Pacific train is being promoted by Kiwirail (the parent) as a tourist train service yet they are treating if it is a local commuter train and that it has no purpose, except upset the tourist.

      I still there is a bigger things going on behind the scenes over the future of the Christchurch to Picton rail link

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