Trams are cheaper per passenger km than buses in the right circumstances

As per above the cost per passenger mile of a tram is around half that of a bus.

 

Note: whilst the second item below is from 2002, the point it makes is valid ie trams in dense routes are much cheaper in £s per passenger km than buses.  The comparison is valid because Buchanan used contemporaneous bus and tram costs, and these have both inflated at more or less the same rates.  However you cannot of course use the quoted installation costs as these are clearly out of date.  To view uptodate visit: https://bathtrams.uk/0-likely-tram-track-installations-costs-for-bath-french-tram-engineering-experts-egis/    Buchanan was a highly respected consultant and they don’t just make these figures up as they would lose all professional credibility.

Comparative benefits of trams vs buses, Bath Royal Literary and Scientific Institution, Malcolm Buchanan, Senior Director, Colin Buchanan and Partners. 12 February 2002

1)  Andrew Braddock – Lifetime working at senior levels in Bus and Tram systems immediate past Chairman and a Vice-President of the Light Rail Transit Association (LRTA), and Chairman of the Promotions  Group of industry body UKTram, as well as being Vice-Chairman of the UK Bus Driver of the Year Competition and a member of the Bus & Coach Forum of the Chartered Institute of Logistics & Transport (CILT)

“”The most important thing is to understand whole-life costing.  A tramway needs to be assessed over 40 to 50 years and in that period the biggest single expense will be staff costs, hence the need to achieve high ratios of passengers to drivers.  Up to 300 people on a tram with a driver is better than 90 on a bus.  Next highest cost will be vehicles and their maintenance.  A tram will cost between £1M and £2.5M (over the 20- to 44-metre range of lengths in most manufacturers’ catalogues) but will last 35-40 years.  A bus will cost £0.5M but last only 12-15 years.  Maintaining buses is around twice as expensive as for trams, even allowing for OHLE costs.  Take carrying capacity into account and anyone can do the maths.  Crudely, a line requiring 10 x 30-metre trams at £1.5M a pop would need 30 buses replaced twice over the whole-life costing period.  That’s why there are so many tram systems “over there” – Andrew Braddock”

Extract from summary of presentation at: https://www.brlsi.org/events-proceedings/proceedings/17999

2) Trams vs. Buses: Making The Right Decision – Lecture given by Malcolm Buchanan, Senior Director, Colin Buchanan and Partners, on 12 February 2002.

Conclusion – Trams are cheaper than buses

3) Experience in Nantes

“”The most important thing is to understand whole-life costing.  A tramway needs to be assessed over 40 to 50 years and in that period the biggest single expense will be staff costs, hence the need to achieve high ratios of passengers to drivers.  Up to 300 people on a tram with a driver is better than 90 on a bus.  Next highest cost will be vehicles and their maintenance.  A tram will cost between £1M and £2.5M (over the 20- to 44-metre range of lengths in most manufacturers’ catalogues) but will last 35-40 years.  A bus will cost £0.5M but last only 12-15 years.  Maintaining buses is around twice as expensive as for trams, even allowing for OHLE costs.  Take carrying capacity into account and anyone can do the maths.  Crudely, a line requiring 10 x 30-metre trams at £1.5M a pop would need 30 buses replaced twice over the whole-life costing period.  That’s why there are so many tram systems “over there” – Andrew Braddock”

 

Fred,
I have two more talks to give to Uni of Bath Students, 21st Forecasting Demand and 28th Operating Tramways.
Obviously if the tramway is built with a public grant, then the running costs appear to be dominant, until the assets need replacing. Ian Yearsley did an excellent anaylsis of company v municipal financing of tramways, comparing LCC, with the 3 private London tramways (Met, LUT and SMET). He showed that when municipal tramways generated a surplus this was absorbed into the Council general funds. One of my students looked at the finances of Liverpool Corporation Tramways between 1925 and 1935, and showed that on average an annual surplus of £250k was paid into Council funds, on top of which the tramway paid £250k pa for rates. These were used to reduce domestic rates, principally benefitting people with big houses, who did not use the trams very much.
Ian Yearsley also showed from LC Council records that when assets needed replacement, this was treated as a ‘subsidy’. In contrast the 3 companies depreciated their assets, so were able to undertake repairs and replacement from retained funds. Finally he showed that had the LCC run its tramway as a stand alone (100% owned) company, all replacements would have been funded like the private tramways, and an average annual dividend of 4% would have been paid into council funds. The allegation of ‘subsidy’ certainly did not help with the survival of tramways.
As for contemporary tramways, almost each is unique so I am not surprised that you have not been able to find any figures. Also as most (if not all) are ‘municipal’, fares are set “politically” rather than reflecting market conditions. This public fixing of rates did not help US private tramways, and did not help UK railways, which in 1938 mounted a ‘Square Deal’ campaign to provide commercial freedom to set rates and so be able to compete with road haulage.That did not come until the 1968 Transport Act.
If tramway operating costs are separately accounted, then the biggest cost item is staff wages (c 60%), power costs (c10%) maintenance and repairs (10%) and 20% for the others including admin.
On the question of assets, this depends on their expected life and whether they are depreciated on a straight line basis, or like cars declining amounts. And of course there is inflation.  This is why SY Supertram which cost £250m to build and equip in 1992-1995, now needs £250m just to replace the worn tracks. The 26 original trams are 30 years old, and the ‘tram-trains’ recently bought for the Rotherham extension cost £4m each.
Hope this helps,
Lewis LEsley