Where have all the coaches gone and does it really matter?

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Love them or loath them, and popular opinion typically tends polarize more toward the latter, the answer to the second part of the question, “where have all the coaches gone and does it really matter?” has to be a resounding yes it matters deeply.

The premise of the piece that follows is that as we move from the end of an unusually strong domestic summer season, towards a more normal shoulder months and off-season pattern, the absence of coach business is going to become far more apparent and consequently for many destinations, attractions and businesses far more problematic. Most obviously it will be a problem for hotels but also in turn for all the other businesses that knowingly or unknowingly rely on the trickle-down trade that hotel guests bring or from business from day trips.  This is only going to get worse as out bound domestic international travel opens up and we start to look towards a potentially more normal pre-pandemic style 2022 spring and summer season.

Why are leisure day trips and overnight coach group so important; what basic but critical functions does or did the coach trade perform for us?  In simple terms it fills and smooths the peaks and troughs of: hotels occupancy, underpins attraction visitor numbers and generates footfall and custom for all manner of businesses in places and, critically it does so at those times of day, days of the months and times of year when non-group leisure markets are at their weakest or non-existent. Yes, some of this “filling” is/was high volume and, often characterised as, low or very value. However, on reflection, it seldom if ever displaced better business but rather provided business where no other was available and none could easily or affordably be generated by other means.  The truth perhaps is that, you don’t really know what you have got until it has gone.

Day coach trips from home locations help fill destinations and individual attraction whilst provide footfall and potential for trade for other business.  Overnight trips and coach tours do much the same in the destination or destinations visited and places on route to, from and in between. They also filling, at scale, otherwise vacant bed spaces and generating a much-needed return on hotel infrastructure and staff coats when and wherever troughs would otherwise have appeared.

If a lack of coach business is really such a problem, then why has this not been highlighted more stringently nationally?  Probably because, thus far, it has been disguised by bigger issues or masked by other short-term positives.  A lack of coaches didn’t matter when hotels, attractions and many other businesses operating in the visitor economy were largely closed. It has also mattered a lot less than it would have otherwise done once we reopen this summer, because of a combination of pressure on normal capacity and a glut of individual domestic visitors in most, if not all domestic destinations.

There has been little mid-week and no notable weekend overnight capacity in most popular destinations and certainly no spare capacity on the scale needed to accommodate guest by the multiple coach load.  The notable exception of course being those remaining specialist group hotels, often owned and run by coach operators and tour companies themselves. These venues have tended to absorb much of what little business that there has been in the sector. Not unreasonable the vertically integrated coach and accommodation operators have filled their coaches and their hotel first in preference to seeking other suppliers.  Meanwhile the loss of any day trip traffic to destinations and historic and other attractions has been masked by the increased buzz of a captive domestic market for individual day trips and staying visits, travelling by other means (largely private cars). No one has had much reason to notice the lack of coaches or to feel any real negative impacts, at least not yet.

The strong main season is now behind us, we are towards the end of a more normal autumn shoulder period with an uncertain off-season fast looming.  Out bound domestic international travel is reopening fast and doing so in time for the last main school half-term holidays of this year. And yet there is absolutely no sign of any significant resumption of the coach tourism, the traditional key filler for many hotels and destinations through the Autumn Winter and the Spring month up to the start of the main 2022 season. What is more and I am right about where all the coaches have gone, then there may be very little prospect of a recovery anytime soon.

So, where have all the coaches gone?  In any past domestic crisis, the demand has dropped and the effected sector or sectors have simply hunkered down to await the return of demands and established patterns. Both the cause and solution have been demand led and in past that demand has always returned relatively quickly.  The ubiquitous nature of covid 19, it’s the length and scale have meant that it has impacted not only on demand but also on supply.  For example, as indicated earlier the normal patterns of hotel supply have been temporarily adjusted so coach companies can’t (couldn’t this summer) necessarily find bedspace in the quantities and at the price points required to service the slowly returning demand.  That position may well be changing.

Far more serious and potentially far more long lasting in this instance is a physical loss of coach capacity. Last year there were some significant, high-profile closures of major coach operators.  Some of the brands and their customer databases were then bought out by other operators but not their coach fleets.  Less obvious and less well known was the large number of closures of local and regional coach and tour operator, SMEs with a combined capacity much greater than that lost in the closure of the Specialist Leisure Group and David Urquhart Travel. 

It has taken over a year for British Destinations to get a credible estimate but one well-placed industry specialist has recently put the loss of coach capacity a result of 2020 at c 12k to 14k vehicles out of a total estimated UK coach fleet of c 30k used for all purposes (everything from daily school runs to long distance timetabled travel).  Some of those coaches will have or still could be taken back into service or used, for example, to replace older vehicles in existing fleets, at no net gain but by no means all of them. Even the most conservative guestimate suggests that several thousand leisure coaches have been removed from daily service and in all likelihood many more. 

Structural damage of that scale is bound to have profound implications, but getting anyone to take that loss of coach capacity seriously as a strategic tourism issue has and continues to be a struggle. Simplistically coaches = transport, transport = DfT and DfT have far bigger transport issues to address than the immediate and longer-term impacts of a structural hit on leisure coach capacity. DCMS and other department, who we might assume should be interest and are to differing degrees, have to defer to DfT.  DfT currently have, it seems, limited interest in leisure coach travel and even less still in tourism and the visitor economy which by the rules of the Westminster game are someone else’s problem, even if the causes and effects are very much in DfT’s own area of influence.

One of the many issues DfT is struggling with is a lack of qualified drivers for larger vehicles.  One of the consequences of this is that traditionally relatively poorly paid coach drivers are being poached to drive other vehicles (both big and small) at currently far more attractive rates.  Last week RHA (Road Haulage Association) estimated that there are now more than 5k driver vacancies in passenger transport, which includes coach and leisure coach drivers.  So not only do we have a situation where there are potentially 40% fewer coaches on the road than there were in 2019, it also seems we also have too few drivers to operate what remains of that much reduced fleet.

That lack of drivers is apparently already impacting on bread-and-butter, contract work like school runs but logically it must at some point serve to constrain current and restrict future growth in the coach-based day and staying leisure visits.  Driver shortages and competition to employ those that are available will not be resolved quickly. It may well become worse in the short-term as demand from other sectors increases in the run up to Christmas.   It is difficult to predict but one of the longer-term consequences of all of this may be a need for a permanent hike in coach driver pay rates and therefore a further change to the price sensitive dynamics of the group travel business model.

All in all, those destinations and those attractions and businesses that rely directly or indirectly on coach-based tourism, in or out of main season, now face a period of great uncertainty about the future nature of and rate of recovery within their domestic group travel, based business.  International inbound coach and coach enabled international travel within the UK is still all but non-existent. If and when it begins to recover many of the structural issue impacting on the domestic coach industry will almost certainly have an influence here too, especial where UK vehicles and UK drivers are used.

Is there any good news?  Yes, there is some good news or more accurately a short-term opportunity.  Those coach companies that are operating have had to review the rules of the game.  Many, particularly independents operators, have had to accept that, for the time being at least, the old rules no longer apply.  While they will still be looking for package content and product 6 plus month and often more away, as before, some are putting together and selling day and staying packages at as little as 6 weeks or less notice.  For those destinations and businesses that have group travel product to sell, even product this side of Christmas it isn’t too late to communicate that to operators and tour companies, and it certainly isn’t too late to be discussing early New Year opportunities and beyond.  Those who are aware of this and aren’t just assume it’s a closed book already, could benefit.  Whether this more fleet of foot, shorter notice approach will continue in to the new normality remains to be seen. If it does then it may be one of those still to be identified welcome leaps in operational practice brought on by the pandemic?

What is needs or can be done now?  It is very hard to see what can be done to correct the structural damage already caused by covid-19 within group coach leisure travel.  Coach companies aren’t going to operate, let alone buy more coaches until demand increases dramatically and demand isn’t going to increase dramatically until supply issues, including fewer coaches and drivers, resolves themself. It is all very chicken and egg. 

What can be done is to talk through the issues with accommodation provider and other businesses so that they can adapt plans to meet the likely business trends, rather than risk them sticking with the hope that the old patterns will magically return.  There is also a job to be done to make sure Government understand the problems other businesses are likely to experience as a direct consequence of limited coach capacity and therefore of more limited numbers of coach customs, regardless of any apparent return toward improved general consumer demand. 

Government needs to understand, if it doesn’t already, that recovery, or a return toward the old norms is not going to be simply or without setbacks and, in areas like the coach market where structural damage has occurred, not without considerable pain yet to come.   The more destinations that highlight any current and emerging issues, the more likely it is that DfT and critically other department in Westminster and in the devolved Governments will start taking the problems faced by leisure coach tourism and group travel seriously.  Potential even look to do something specific to ease problems encountered, whether that’s within the coach industry itself, or in the sectors effected by an absence of normal coach business.

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