1 long distance travel in gb some insights and forecasts david quarmby cbe member and former...

Long Distance Travel in GBsome insights and forecasts

David Quarmby CBE

Member and former Chairman,

Independent Transport Commission

Transport Planning Society

24 November 2009

2

Agenda

• Introduction

• Patterns of long distance travel

• Interpreting the drivers of travel

• Looking at scenarios to 2030

• Conclusions

Agenda

3

Agenda

• Travel over 50 miles a neglected area of policy

• Significant proportion of all CO2 emissions

• Lots of modal-specific policy – rail, aviation, strategic road networks…are they linked up?

• Unexpected things happening – explosive growth of rail travel; road traffic much less fast, but congestion growing; domestic aviation grows (but less to Heathrow)

• ITC commissioned research to explore

• What is long distance travel about? What are the patterns?

• What are the drivers of travel and what can influence it?

• How might this change with different policy scenarios?

Introduction

4

Agenda

• ITC commissioned Professor Joyce Dargay, Leeds ITS, to construct 4-mode aggregate demand model, to back-cast known travel trends to 1996 and forecast forward to 2030

• Report completed, to be published with ITC covering report January 2010

• Thanks to Joyce Dargay for her significant piece of research

• ITC is very grateful to core sponsors Go-Ahead, Stagecoach and Arriva, and to project sponsors Department for Transport, Rees Jeffreys Road Fund, and Network Rail

• Grateful to David Bayliss for chairing the discussion panel, and to Joyce Dargay for joining us to give further insights into the research

Introduction

5

Agenda

• Introduction




• Conclusions

Agenda

6

Scope

• 4 modes: carrailaircoach

• 5 journey purposes:businesscommutingleisureholidayvisiting friends and relatives (VFR)

• 2 distance bands:50 to 150 miles150 miles and greater

• Domestic travel by residents of GB within GB

• Over 50 miles 1-way

• Modelling Aggregate Demand

7

Data Sources

Principal data sources

• National Travel Survey 1995 – 2006

• NTS 2007, 2008 for certain analysis

• Transport Statistics Great Britain (TSGB)

• Lennon (rail ticketing data)

• Long Distance all-mode Travel Survey for this study by ITS

Other sources include

• Various DfT publications; HM Treasury; ORR; CAA

8

Travel by Mode

Trips over 50 miles Car Rail Coach Air Total

Trips 16.9 2.3 1.1 0.2 20.5

Long distance as % of all trips by mode 3% 15% 15% 100% 2%

Miles 1654 252 132 75 2114

Long distance as % of all mileage by mode 29% 54% 68% 100% 31%

Mode share % of long distance mileage 78% 12% 6% 4% 100%

Average trip length, miles 98 110 122 406 103

Average annual long distance travel per capita, mean 2002-06, NTS

9

Travel by Mode

Trips over 50 miles Car Rail Coach Air Total

Trips 16.9 2.3 1.1 0.2 20.5

Long distance as % of all trips by mode 3% 15% 15% 100% 2%

Miles 1654 252 132 75 2114

Long distance as % of all mileage by mode 29% 54% 68% 100% 31%

Mode share % of long distance mileage 78% 12% 6% 4% 100%

Average trip length, miles 98 110 122 406 103

Average annual long distance travel per capita, mean 2002-06, NTS

10

Travel over Time

Total long distance travel, 3-year moving average 1995-2006 NTS

0

20

40

60

80

100

120

140

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Bil

lio

n M

ile

s

Air (4%)

Coach (6%)

Car (78%)

Rail (12%)

11

Comparison with Total Travel

0

50

100

150

200

250

300

350

400

450

500

1970 1973 1976 1979 1982 1985 1988 1991 1994 1997 2000 2003 2006

Year

Bill

ion

Mile

s

Air (TSGB

Coach (TSGB)

Rail (TSGB)

Car, Van & Taxi (TSGB)

Long Distance (NTS)

Total passenger miles by mode (1970 – 2007), TSGB*, and total long distance miles (1996 – 2005), NTS

* TSGB includes short distance travel and travel by non-households and non-residents

12

Travel by Purpose

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

VFR (28%)

Leisure (21%)

Holiday (21%)

Commuting (10%)

Business (20%)

Percent of long distance travel by purpose, NTS

13

Travel by Journey PurposeMode Shares

Car Rail Coach Air Total

Business 75 13 2 10 100

Commuting 74 23 2 1 100

Holiday 75 9 12 4 100

Leisure 79 9 11 1 100

VFR 84 12 3 1 100

Mode shares of distance travelled by journey purpose, %, mean 2002-2006, NTS

14

Travel by Journey PurposeMode Shares


Business 75 13 2 10 100

Commuting 74 23 2 1 100

Holiday 75 9 12 4 100

Leisure 79 9 11 1 100

VFR 84 12 3 1 100

Mode shares of distance travelled by journey purpose, %, mean 2002-2006, NTS

15

Travel by Mode & Distance


< 150 miles 84 11 5 0 100

150+ miles 68 14 8 10 100

Mode shares of distance travelled by distance band, %, mean 2002-2006, NTS

Car Rail Coach Air

< 150 miles 68 57 51 0

150+ miles 32 43 49 100

Total 100 100 100 100

Distance band shares of distance travelled by Mode, %, mean 2002-2006, NTS

16

Patterns of long distance domestic travel

Key points

• one third of all travel is over 50 miles

• the car dominates with nearly 80% of travel, rail accounts for 12%, coach and air share 10%

• car dominates for all journey purposes; rail strong for commuting and VFR; rail and air significant for business; coach significant for holidays and leisure

• car travel seems to have flatlined in the last few years, with rail continuing to grow

• 70% of all long distance travel is for holidays, leisure and VFR; business 20%, commuting 10%

• generally balanced between <150 miles and >150 miles; car journeys tend to be shorter

17

Agenda

• Introduction




• Conclusions

Agenda

18

The drivers of long distance travel

Elasticities

• income elasticity of 0.5 means that a 10% change in income will generate a 5% change in long distance travel

• price elasticity of -0.3 means a 10% increase in cost or fares will cause a 3% drop in demand

• cross-elasticity – the impact on (eg) rail travel of a particular change in travel times by car

• cross-elasticity of 1 of rail travel w.r.t. car travel time means a 5% worsening of car travel times will produce an increase in rail travel of 5%. But don’t forget the effect of relative scale.

19


Deriving and interpreting elasticity estimates

• income – short and long run

• demographic and geographic factors

• own and cross elasticities – price and time

20


Income elasticities

Purpose Distance miles

Car Rail Coach Air

Business 50<150150+

0.340.54

1.391.51

0.000.00

*1.53

Commuting 50<150150+

0.310.50

1.341.57

0.000.00

**

Holiday 50<150150+

0.380.61

0.640.56

0.500.43

*1.31

Leisure 50<150150+

0.310.47

0.500.43

0.000.28

*1.26

VFR 50<150150+

0.530.70

0.250.42

0.000.31

*1.63

All All >50 0.46 0.83 0.10 1.44

21


Income elasticities

Purpose Distance miles

Car Rail Coach Air

Business 50<150150+

0.340.54

1.391.51

0.000.00

*1.53

Commuting 50<150150+

0.310.50

1.341.57

0.000.00

**

Holiday 50<150150+

0.380.61

0.640.56

0.000.00

*1.31

Leisure 50<150150+

0.310.47

0.500.43

0.000.28

*1.26

VFR 50<150150+

0.530.70

0.250.42

0.000.31

*1.63

All All >50 0.46 0.83 0.10 1.44

22


Income elasticities

• car – less than 0.5 Similar across journey purposes, slightly higher for VFR, higher for longer journeys

• rail – average under 1 But much higher for business and commuting, similar to car for other journey purposes

• coach – unresponsive to income except for longer distance leisure and VFR

• air – about 1.5 for all journey purposes - similar to rail for business

• as income grows, very different patterns of travel growth

23


Demographic and geographical factors

long distance travel analysed by

• household income, gender, age, employment status

• Region of residence, size-scale of municipality or rural

• number of adults in household, whether children, whether main driver of company car

• type of residence, length of residence

Separate models for each of four modes, five purposes and two journey lengths, and the forty in combination

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• overall income elasticity 0.42

• longer distance travel more for men than for women

• more for those under 60 vs over 60

• more for employed/students than for unemployed/retired

• more for those with company cars

• declines with longevity at current residence

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• those in the South West and East Midlands travel more, and those in the WM and northern regions travel less than average

• long distance travel increases as size of municipality decreases, greatest for those in rural areas

• the larger the household the less the per capita long distance travel, and least in families with children

• greater for those living in detached houses....!

26


Own cost/price and time elasticities – long run

• car: cost elasticities -0.3 to -0.8, more for holiday/leisure

• rail: around -0.5 for business and commuting; -1.0 to -1.6 for holiday/leisure/VFR

• coach: -0.8 to -1.0

• air: -0.4 for commuting; around -1.0 for all other

• car: own time elasticities: -1 to > -2 generally; -2.5 for more distant holidays

• rail: -0.5 to -0.75 for commuting; -1.5 to 3.0 for all other

• coach: -1.3 to -1.75

• air: around -0.5 across all purposes

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Significant cross elasticities – cost/price and time• for business travel: ~ 0.2 c/e to rail w.r.t. car travel cost

• for commuting: ~ 0.2 c/e to rail w.r.t. car travel cost for <150 miles

• for holiday: 0.4 to 0.8 c/e to rail w.r.t. car travel cost

• for leisure and VFR: 0.2 to 0.4 c/e to rail and coach w.r.t. car travel cost

• for business travel: ~1 c/e to rail w.r.t. car travel time

• for commuting: ~0.5 c/e to rail and air w.r.t. car travel time

• for holiday: ~1.5 c/e to rail and ~0.5 to coach w.r.t. car travel time

• for leisure and VFR: 0.7 to 1.0 to rail and coach w.r.t. car travel time; ~1 to coach w.r.t. rail travel time

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So what does this mean for the drivers of long distance travel by each mode?

• by car: income has a moderate effect, as does the cost of motoring. But worsening of travel times does have a significant impact, especially for longer distance holidays, and does divert demand to rail for business travel, and to rail and (less so) to coach for holidays

• by rail: income has a major effect on business and commuting, and a strong effect on other journey purposes; fares changes have a moderate effect on business and commuting, but a major effect on holiday/leisure/VFR; changes in travel time affect rail similarly. Switching to other modes is modest or non-existent

• by coach: travel unaffected by income. Coach fares and travel times have significant effect on demand. Switching to other modes non-existent

• by air: income has a major effect for all purposes; price elasticity moderate for commuting, high for all other purposes; moderate switching between air (proportionately) and car and rail as their travel times change

29

Agenda

• Introduction




• Conclusions

Agenda

30

Agenda

• Set a base case – with economic, demographic, cost and network assumptions – and project base case to 2030

• Identify alternative scenarios

• Forecast alternative scenarios to 2030 and compare with base case

Scenarios to 2030

31

Input Assumptionsto 2030

Projections of the population (ONS, GAD)

• Population by age and gender• % population 60+• The number of households• Number of 1-adult households

2005 2030 Annual % change

% Change

Population m 58.5 68.8 0.65% +18%

% population 60+ 21.2% 27.9% 1.10% +32%

Households m 24.8 31.8 1.00% +28%

1-adult households 16.8% 21.8% 1.04% +30%

32


Real GDP forecasts (HMT) – average of independent forecasts % growth per annum

2009 2010 2011 2012 to 2030

April 2009 -3.7 0.3 2.2 2.5

February 2008 2.0 2.6 2.6 2.5

Base case

33


Crude oil price projections (DECC), 2008 US$/bbl

DECC 2010 2015 2020 2025 2030

Scenario 2 70 75 80 85 90

Scenario 3 84 102 120 120 120

Scenario 4 103 142 150 150 150

Exchange rate: $1.60/ £

Base case

34

Base Case Assumptions

Increase

2009 to 2030

Source/assumptions

Petrol prices +27% DECC

Car fuel efficiency +23% 1% per year

Per km fuel prices +4% as above

Motoring costs 0.5% other motoring costs constant

Journey time (roads) 7.5% DfT NTM 2008

Rail fares +28% RPI+1%

Air fares -12.5% half of DfT’s assumption

35

Projections 2030% Change from 2005


Base case 30 35 25 126 34

36

Alternative scenarios

Impact on all LDT * Assumptions

Constant real rail fares Rail fare 0% (+28%) Real rail fares at today’s level

Road user Charging Motoring cost (+0.5%) +21% bus. & comm. +8% otherJourney time +3% (+6%)

5p/km business & comm.2p/km all other purposes

Air fares: APD £10 Fares +1% (-12.5%) £10 increase

Air fares: 25% fall Fares -25% (-12.5%) DfT projections 2008

Car: low fuel efficiency Motoring cost +10% (+0.5%) No improvement in eff. (23%)

Car: high fuel efficiency Motoring cost -10% (+0.5%) DfT: eff. 92% petrol, 43% diesel

Motoring costs +1% pa Motoring cost +23% (+0.5%) Increase in total motoring cost

Low car travel growth 0 income elasticity for car travel

* % change 2009 to 2030 (base case % change)

37

Projections 2030% Change from 2005


Base case 30 35 25 126 34

Constant real rail fares 28 60 17 120 35

Road User Charging 27 48 27 123 33

Air fares: £10 APD 30 36 25 101 33

Air fares: -25% 30 33 24 154 35

Car: low efficiency 24 38 27 127 30

Car: high efficiency 36 31 22 125 38

Motoring costs 1% pa 19 42 30 128 26

Low car travel growth 12 35 25 126 20

38

Projections 2030% Change Base Case


Constant real rail fares -1.4 19.0 -5.8 -2.5 0.9

Road User Charging -2.2 10.3 2.0 -1.5 -0.3

Air fares: £10 APD 0.2 1.3 0.1 -10.9 -0.4

Air fares: -25% -0.2 -1.3 -0.1 12.5 0.5

Car: low efficiency -4.4 2.7 2.2 0.5 -2.8

Car: high efficiency 4.7 -2.7 -2.2 -0.5 3.0

Motoring costs 1% pa -8.8 5.7 4.6 1.1 -5.6

Low car travel growth -14.0 0.0 0.0 0.0 -10.5

39

Sensitivity Tests Projections 2030 Billion Person Miles


Actual 2005 91.1 15.0 6.9 4.4 117.4

Base case 30% 35% 25% 126% 34%

GDP 1.25% pa from 2012 (2.5% in Base case) 13% 3% 23% 48% 14%

Low income elasticities (33% of Base case) 24% 24% 25% 93% 27%

40

Agenda

• Introduction




• Conclusions

Agenda

41

Agenda

• On reasonable base case assumptions we forecast a 34% increase in long distance travel – 125% by air, 35% by rail, 30% by car and 25% by coach – mostly income driven

• Universal road charging cuts car demand by 10%, but rail demand is very sensitive (48% growth vs 35% growth)

• Variations in car fuel efficiency (and cost) affect car travel by + 20%, and a 1% rise in motoring costs especially

• Air travel very sensitive to APD increases, and fares variations – but still >100% growth for any of the scenarios

• Coach travel affected by rail pricing and motoring costs

• lower GDP growth (1.25%) halves the travel growth

Conclusions

42

Long Distance Travel in GBsome insights and forecasts

David Quarmby CBE

Member and former Chairman,

Independent Transport Commission

Transport Planning Society

24 November 2009

1 long distance travel in gb some insights and forecasts david quarmby cbe member and former...

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long distance mileage

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known travel trends

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mode share