Transport Tycoon Forums

The ROSCO should still have the incentive to buy some new trains however, to improve their offering to TOCs, and improve their margins...although I know this difficult at the moment because there isn't much capital about. The TOC shouldn't have any problem with the introduction of new trains, because they will not hold the risk on the books - although they could theoretically buy them in-house, and then they would always have the fail-safe position of renting them out to their successors.

An important factor to mention in the case of the HSTs and 91s is that these trains cost very little in accounting terms, as the HSTs are probably fully depreciated, and the 91s a large extent depreciated. If infact these sums are counted on ROSCO balance sheets as the ROSCOs didn't pay for these trains. Some research done recently on the lifetimes of steam locomotives showed that BR in the 1950s had little incentive to replace surviving 19th century steam locos as they had fully depreciated long ago. No doubt the continuing survival of the Class 20 is partly related to this.

Aditmittedly, normal economics are not known to work well in the rail sector. I must read up on how Virgin financed their new trains...I suspect that could be an interesting case study.

If thats the case maybe the HSTs will hang around for a long time. In this way it is similar to the procurement for airliners. Airlines usually source their aircraft either by buying the aircraft themselves or through a leasing company (which are usually run by massive banks or the aircraft manufacturers themselves). If an aircraft is leased, the lease costs are generally fixed upon the start of the lease and each payment subsequent is the same as the first, until the end of the lease period whereby it may be lowered due to depreciation, loss of reliability, yadda yadda... However if you own your aircraft you bear the brunt of your assests appreciation directly. The most obvious example of this is Delta Airlines large fleet of Douglas DC9s, which it acquired with the merger between Delta and Northwest a few few years ago. The DC9 design itself goes back to the early 60s and the aircraft in operation with delta range from deliveries from 1966 for the earliest DC9-30s up until the early 80s for the newest DC9-50s. The aircraft themselves are owned entirely by Delta and due to their age are completely depreciated. Most short range airliners generally have a life span of 20 to 25 years, so having 30 - 45 year old aircraft seems a bit strange. As long as fuel prices aren't particularly high the cost to operate them is a fraction of what it would cost a new leased aircraft, hence they continue to fly (well for the -30 and -40s only up until the end of october, but the -50s should be around for up to another 10 years). So maybe it should be said that when the last class 66 is retired from service, it will be class 20s dragging it to wherever it was going!

BTW if you want to start up your own airline now would be a good time with large numbers of older, less popular aircraft types going for a song. $4m for a 20 year old 180 seat MD80 is a steal!

Shorter franchises to prove the company can run that line, then a longer one if they're succesful to allow them to invest and capitalise on that investment? Sounds like a reasonable way to work it.