Cardiff to Sell?

Seemingly in the face of increasing financial pressures, Cardiff council is considering selling up to 40 per cent of 228-vehicle Cardiff Bus, “netting tens of millions of pounds”, according to the South Wales Echo.

While the newspaper’s figure may be somewhat optimistic, it must nevertheless send shivers down the collective spine of Britain’s 13 other remaining municipals. After all, you can’t compare Cardiff Bus to recently sold municipals such as failing Chesterbus, average Blackburn Transport, or investment-starved Yellow Buses.

Instead, Cardiff Bus is one of Britain’s most successful operators, and its council ownership has enabled it to invest significantly over the last seven years. In 2006, this included 19 attractively liveried and well-marketed new Scania Omnicity artics.

The average fleet age is a creditable eight years, expected to fall later this year to 5-6 years, upon the delivery of 15 Scania Omnicity single decks and 13 Scania/East Lancs Olympuses.

And, Cardiff Bus is seeing unprecedented passenger growth. The council introduced free travel in 2001, a year ahead of the Welsh national scheme. Cardiff Bus also benefits serving south Wales’ main ‘honeypot’, with passengers and concessionary travellers using its buses having arrived from a wide hinterland. Then, there’s the renewed economic activity associated with both Cardiff Bay and the higher profile of a ‘capital’ city with a devolved regional government.

It would therefore appear that the decision to sell relates less to the operator than to tight local government budgets. What will it mean for Cardiff Bus?

A 40 per cent private stake could bring further growth strategies and better marketing, though there’s evidence of both being undertaken well at the moment. Overall control will continue with the council, though a significant slice in private hands may see a push for improved margins, threatening services at marginal times.

There could be more. Operators currently sit well enough together but may be uneasy about one or another emerging as a Cardiff Bus partner. Will ranked no. 2 Stagecoach wish to see its position protected and, if so, how will it react? Like the Chester or Bournemouth situations? The Chesterbus v Arriva court case has set legal precedent in the registration of duplicate services.

And, you can be sure other councils will be looking on. If they haven’t already started the thought process.