Bus Line Reaches for the Sky : Greyhound Revamping Service in a Bid for Short-Haul Fliers
Greyhound Lines wants more than ever for you to leave the driving to them.
The only nationwide bus service this week launched an effort to lure more people out of their cars and away from airports and train stations by lowering ticket prices and adding departures on short-haul routes in Southern California and other markets. The strategy aims particularly to gain passengers from rival carriers such as Southwest Airlines and Reno Air.
But it will take significant improvements in customer service to induce many more travelers to go Greyhound, analysts and passengers said Friday.
“The service would have to be much improved” to get him to travel Greyhound more often, South Gate truck driver Theatis Sutton said Friday, after waiting in line at the Greyhound terminal in downtown Los Angeles for 45 minutes even though he had a prepaid ticket. He said he usually flies and was taking the bus only because his employer required it.
Greyhound said its changes were prompted largely by its losing customers on trips of 500 to 750 miles--such as Los Angeles to Portland, Ore.
Under the plan announced Thursday, Greyhound will abandon some of those less profitable longer routes and focus instead on serving cities within 400 miles of each other, said Elizabeth Dunn, a spokeswoman for the Dallas-based company. Besides Southern California, Greyhound is also concentrating on the Northeast, South, Midwest and parts of Texas.
The 100- to 400-mile trip market, where one-way fares are typically between $20 and $40 and rides last between two and eight hours, includes routes such as Los Angeles to San Diego, San Francisco or Phoenix, Greyhound President Frank Schmeider said.
Those short-haul fares are attractive compared to those for flying or driving, said Sarita Skidmore, a principal in the Menlo Consulting Group, which specializes in travel and tourism.
Los Angeles, San Diego, Santa Ana, San Bernardino, Riverside, Barstow, Calexico and Indio are among the cities likely to benefit from lower fares, better and more frequent service or both, Dunn said.
Greyhound has tested the concept in key short-haul markets around the country. After it reduced one-way fares from Los Angeles to San Francisco to $29 from $36, ticket sales ballooned 61% and revenue on that route rose 21%, Dunn said.
Greyhound will also cut costs by shedding 100 to 200 of its 1,800 buses, eliminating free baggage service and closing terminals during late-night hours, Schmeider said. An unspecified number of jobs will be cut “at all levels,” he said.
Greyhound has lost money in three of its last five quarters, and Schmeider said Thursday that the company will post an operating loss of at least $27 million for the second quarter.
Greyhound hopes to lure more middle-income travelers who would otherwise drive or take low-fare flights. The average annual income of a Greyhound passenger is $16,444.
To succeed, Greyhound “will have to do something to provide really good service, the way (Amtrak’s) Metroliner has changed the image of the train,” consultant Skidmore said. “If Greyhound’s service is good, they can compete.”
Planes, Trains and Buses
Under attack mainly from low-cost airlines, Greyhound plans to restructure its bus service in California and other markets. Here’s how bus fares compare to train and airline fares from Los Angeles.
Greyhound Amtrak Southwest Los Angeles to: O-W R-T O-W R-T O-W R-T San Diego $12 $24 $24 $32 $49-69 $98-138 Santa Barbara 11.50 21 20 26 49-69 98-138 San Francisco 29 58 67 68-134 49-69 98-138 Phoenix 32 61 58-85 58-170 44-62 88-124
All fares are unrestricted. Lower fares quoted by Amtrak and Southwest Airlines are for advance-purchase tickets. O-W = one-way; R-T = round-trip.
Sources: Southwest Airlines, Amtrak, Greyhound
