Electric Vehicles and Pod Point IPO

If the Government has its way, we’ll all be driving electric cars (EVs) soon. One of the concerns of drivers though is they might run out of battery power so the provision of chargers is of key importance in driving acceptance of electric cars.

There is clearly a big potential market for chargers, not just in homes but also in public places, at office car parks, supermarkets and other venues. One of the providers of chargers is Pod Point Group (PODP) who recently undertook a public stock market listing (IPO). The prospectus they issued (see link below) gives a very good overview of the market for electric vehicles and the charging infrastructure in the UK.

Pod Point was founded in 2009 and has installed over 100,000 charge points mainly in the UK. There are government grants available (OZEV) for home installations although those are likely to be withdrawn or altered from 2022. The government is also funding from 2022 large on-street charging schemes and rapid charging hubs across England. Meanwhile car manufacturers are focussing on production of new electric only (Battery Electric Vehicles – BEVs) and hybrid models. Some 6.6% of new vehicles sales were EVs in 2020 and by 2040 it is estimated that 70% of all vehicles on our roads will be EVs.

Chargers fall into two main categories – AC and DC with the latter providing more rapid charging. Home charging is typically via slow AC because UK homes do not have 3-phase electricity supplies. There are several different connector types. Pod Point estimate they have 50-60% of the UK home charge points and 29% share of public installations. But there are a number of competitors include BP Pulse. Petrol station forecourts are one location where chargers are being installed but it is unclear where the dominant charging location (home, office, etc) will be in future.

Those people with homes with no off-street parking will need to charge at public locations unless viable “pavement” chargers are developed. London-based Connected Kerb plans to install 190,000 on-street chargers by 2030.

Pod Point owns some installations under commercial arrangements with venue locations and that includes 396 Tesco sites where slow chargers are installed. Is that to encourage shoppers to spend more time in the store while their vehicle is recharging one wonders?

Pod Point doubled its revenue in 2020 and more than doubled its revenue in the first six months of 2021, but still made a large operating loss. The market cap of Pod Point at the time of writing is about £380 million.

How the market for the provision of EV chargers will develop is unclear and there are the usual numerous risk warnings in the prospectus. Government interference in the sector is clearly one risk and when a market is growing rapidly there are often folks willing to plunge in regardless of short-term profitability. The big oil companies are also moving into the sector and might provide significant competition.

But if you are interested in electric vehicles, it’s worth reading the Pod Point prospectus.

Roger Lawson (Twitter:  https://twitter.com/Drivers_London )

Pod Point Group Prospectus: https://investors.pod-point.com/prospectus

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How to Reform London’s Transport

Following on from my previous blog post about the financial crisis faced by Transport for London (TfL) and the Mayor (see link below) I have given some thought to how the problems might be resolved.

The solution from Sadiq Khan and London’s Transport Commissioner is to ask the Government for more money. Not just some millions of pounds in immediate bail-outs but billions in the next few years.  There is no doubting the dire financial situation that TfL has got itself into partly because of the Covid epidemic which has reduced income substantially. But it was slow in responding to that and had not been managing its financial resources properly for years.

The big problem is that TfL has been run to pander to its political master whose key focus is to please the population of London so they can get re-elected when the time comes. But TfL is not just a useful transport service to serve the growing population of London but is in essence a business. It should be run like a business and if it is not it will continue to rack up losses and need repeated bail-outs.

The rot set in when the Mayor of London was given responsibility for TfL (and he chairs the Board of TfL), particularly when TfL took over responsibility for all underground, bus and main roads in the capital. From Ken Livingstone onwards, decisions have been made to please the electorate rather than ensure that TfL ran on a commercial basis. Ken expanded the bus network enormously which resulted in subsidies of over £1billion per year. Buses ran more frequently on routes that were often under-used but only now is the network being reduced.

Concessionary fares such as the Freedom Pass were expanded – again a very popular policy but one which imposed costs on the transport operators even if local councils covered some of the costs.

Ken installed a Congestion Charge system (in essence a tax) while promising it would solve traffic congestion which it never did and now we have the ULEZ tax which it was claimed would solve London’s air pollution problems, but which it has not – see Reference 2.

Sadiq Khan froze public transport fares for 5 years until March 2021. This no doubt helped him to get elected. But this was a political decision not a sensible financial one. He gambled on revenues from Crossrail filling the budget gap that was created but that project was over budget and severely delayed. When the Covid epidemic hit there was no margin of safety left to absorb the reduction in income that comes from bus and tube fares.

Instead of cutting services to meet the reduced demand level and hence save costs, services were maintained at a high level for political reasons and to avoid conflicts with trade unions. That’s not how any commercial business would have tackled the problem.

TfL is a commercial business where less than half its income comes from fares paid by willing customers. Much of it comes from grants and other subsidies, often indirectly from taxpayers. That is the core of the problem which no politician, whatever the hue of the Major of London, is going to tackle.

The solution to many of these problems is to remove TfL from elected political control and give it a clear mandate to be run solely on a commercial basis. A commission, independent from the Mayor of London, should be established with very specific terms of reference which should be binding on a new London Transport Commissioner. Such a commission should report to a Government minister but be independent in terms of policy making and executive decisions, i.e. the Government and any Mayor of London should only have a consultative role.

The remaining issue is whether roads and public transport should be combined under the same Transport Commissioner with roads being financed and maintained to some extent from public transport fares. Although the Mayor currently obtains some income from the Congestion and ULEZ charges, he argues that he should receive a share of national taxes used to finance road development and maintenance. That would only make sense if it was removed from political control in London.

But there is a built-in basis for irrational decisions if the London Transport Commissioner is responsible for multiple transport modes – underground, surface rail, London buses, taxis/PHVs and private vehicles (cars, LGVs and HGVs). Each of these should be made standalone businesses so that no one role subsidises the other. They should be made independent profit and cost centres. London Underground should not subsidise London Buses and vice versa. Road vehicles including buses should be covering the maintenance costs of the road network (including that for bridges, flyovers and tunnels) in London. If there is any surplus in any one sector it should be used to expand the relevant network and improve services, not be used to subsidise other loss-making activities.

The claim for a single transport body such as TfL was that it would enable the construction of an integrated transport system but apart from a common fare payment system there is little real integration.

The above is a manifesto to reform London transport so that it meets the needs of consumers of its services on a viable economic basis in the future. No other solution can do that.

There are of course other possible escapes from TfL’s financial problems. It has assets it could sell off. Perhaps someone would like to buy the London Underground?  But that will never happen while it is subject to political interference. Or it could borrow more money but that would not solve the basic financial problem. When expenditure exceeds income in your household budget, the last thing you should do is to increase your mortgage or raise the limit on your credit cards.

As it stands, the Mayor’s only solution seems to be to ask his fairy godmother (the Government) to come up with oodles of more cash. The Government should ignore the Mayor’s wailing and threats and get down to imposing substantial reform along the lines I suggest.

Roger Lawson

Ref 1. Transport Crisis in London blog post: https://freedomfordrivers.blog/2021/11/19/transport-crisis-in-london/ 

Ref 2. ULEZ Had Minimal Impact blog post: https://freedomfordrivers.blog/2021/11/17/ulez-had-minimal-impact-on-air-pollution/

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Vision Zero Failing But The Mayor Thinks Otherwise

Transport for London (TfL) have issued a press release on the progress in achieving “Vision Zero” – the plan to achieve zero deaths on London’s roads. See link below for the details. But the progress report makes it clear that since the launch of this initiative in 2018, progress has been negligible. The object of zero road deaths is never going to be achieved based on the reported data.

The chart above shows the trends in Killed and Seriously Injured (KSIs) in the last few years taken from the Vision Zero report. From 2013 to 2019 there was some minor improvement and in 2020 a big improvement for most transport modes probably due to reduced traffic from Covid lockdowns including more working from home. But there was also a rise in cyclist KSIs as the number cycling increased.

It is not at all clear that the policies promoted in Vision Zero are of any benefit at all, particularly the focus on lower speed limits. The latter includes more 20 mph limits and more enforcement by the police.

What is the reaction to the progress report? TfL proposes more 20 limits, more buses to be fitted with ISA to ensure they comply, and more resources for the Metropolitan Police to enable them to enforce up to one million offences by 2024/2025. Unfortunately this is all misconceived and won’t achieve the desired outcome because excess speed above the speed limit is a relatively minor contributory factor based on police reports.

See the most recent figures in the table below published by the DfT which shows exceeding the speed limit is only present as a factor in 7% of accidents and a lot of those accidents might be attributable to criminal behaviour of other kinds.

Spending large resources on speed limit setting and enforcement is arguably misconceived when if that same money was spent on road engineering or driver education there would be more impact on accident reduction.

It is interesting to see the individual London borough figures given on page 13 of the Progress Report. Those boroughs that have shown the biggest improvement in road safety since the 2005-2009 baseline are Kensington, Westminster, Bexley and Bromley while those with 20 limits and speed humps everywhere such as Lewisham are behind. That just shows that the boroughs with a more enlightened approach and less dogma such as Bromley have actually done better.

The Progress Report does contain some interesting comments on the problems of the increases in cycling, motorcycling (mainly for delivering goods), and illegal e-scooters which are contributing to rising casualty rates. It is also suggested that the increase in large SUVs is not helping.

But they don’t seem to be proposing any measures to halt the danger from e-scooters to the riders themselves and to pedestrians on pavements where they ride with abandon.

In summary the press release and the progress report are yet more missed opportunities to improve road safety in a substantial way in London.

Roger Lawson

Vision Zero press release: https://tfl.gov.uk/corporate/safety-and-security/road-safety/vision-zero-for-london

Vision Zero action plan progress report: https://content.tfl.gov.uk/vision-zero-action-plan-progress-report-2021.pdf

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Insulate Britain Protestors Jailed

Some of the Insulate Britain protestors who have been blocking motorways and main roads across the UK have been jailed for breaching court injunctions. That includes 9 activists who were jailed for between 3 months and 6 months after they made it clear that they might repeat their actions.

The judge said that although there is a right to make peaceful protests. “Ordinary members of the public have rights too, including the right to use the highways”.

The defendants have also been ordered to pay National Highways legal costs which were originally estimated to be £91,000 but were reduced by the court to £45,000, i.e. £5,000 per defendant. How some of them will pay those charges is not clear.

These protests are costing the police many millions of pounds for which there is no justification at all, while road users have suffered similar costs in delays. It seems likely legal actions will be pursued over other similar protests. Let us hope these penalties will persuade Insulate Britain to think again over their campaign.

Comment: Peaceful protest to bring the concerns of activists to the general public is one thing. But when they deliberately obstruct other people going about their legitimate business it is another thing altogether and obstructing roads is clearly an offence. Such behaviour should not be tolerated and penalties should be made more severe if these protests continue.

Roger Lawson

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Transport Crisis in London

Both Sadiq Khan, Mayor of London, and Andy Byford, London Transport Commissioner, have warned that unless they get more money from the Government then there are going to be savage cuts in public transport and on major infrastructure projects. The latter might include the required repairs to the Rotherhithe Tunnel, the A40 Westway and A12 Gallows Corner flyover leading to their closure.

Some 100 bus routes face the axe and frequencies may be cut on 200 other routes. Other proposals are no more electric buses, no more step-free stations, no more “Healthy Streets” cycling and walking schemes and no more 20mph zones or safer junctions.

Now some readers might welcome some of those things and clearly the Mayor is trying to scare the Government into providing more funding within weeks. But some of those suggestions like closure of the Rotherhithe Tunnel and the Westway would be disastrous for the functioning of the road network in both east and west London.

How did TfL get themselves into such a mess? It all stems from the policies adopted by Ken Livingstone which was for massive subsidies to buses and commitments for large expenditure on Crossrail and other underground projects. The bus network has certainly been greatly expanded but at a cost that was never justified and Crossrail has been a financial disaster. Over budget, over schedule, and never justified on a cost/benefit basis. The Mayor was relying on income from it to cover TfL’s future budgets which it never has.

Boris Johnson never tackled the problems created by Livingstone when he was Mayor while Sadiq Khan has actually made matters worse by spending enormous amounts of money on cycle lanes, LTNs, and other schemes that have damaged the road network. He has also encouraged the growth in the population of London while the infrastructure never kept up with it despite massive central Government funding.

A report in the Express shows that £515 more per person was spent on transport schemes in London than on the North of England. A new report from the IPPR North think tank has published an independent analysis of transport spending over the past decade. Between 2009/10-2019/20, the North received just £349 per person in transport spending. In comparison, the UK as a whole received £430 per person, while London received a staggering £864 per person. Where did it all go one might ask? On pointless and generally uneconomic schemes not justified by any cost/benefit analysis is the answer.

The daft transport schemes such as the Congestion Charge and the ULEZ have actually encouraged people to move out of London and the cuts to public transport that are proposed will expedite that trend. With falling income from bus and tube fares already caused by the pandemic, the outlook is certainly bleak. But failing to maintain the infrastructure such as bridges, tunnels and flyovers while the Major prefers to spend money on other things is surely a sign of gross incompetence.

London needs a new transport plan where expenditure is matched to income and needless subsidies removed. In other words, people should pay the cost of the trips they take on public transport and free riders should be stopped. But will a socialist Mayor ever take such steps? I doubt it. So London is likely to go into further decline and more people will move out.

But London is at the heart of the UK economy so there is some justification for central Government stepping in once again to reform London’s governance. We need less populism (which generally means hand-outs to win votes) and more financial acumen in the leadership. Certainly the current arrangement where you have a virtual dictator in the role of Mayor and a toothless London Assembly is not working.

The key to improving the London transport network is not to have it all (both public and private transport) under the control of one body (TfL) which leads to lack of competition and perverse incentives. For example, encouraging cycling to relieve pressure on public transport while causing more road traffic congestion and introducing schemes such as the ULEZ to help subsidise public transport while increasing the cost of private transport.

Perhaps we need a new Dr Beeching to put the London transport network back into a cost-effective structure as he did for British Rail. But at least the Government seems to have taken some rational decisions by cancelling the eastern link of HS2 to Leeds. Just like Crossrail in London, HS2 was never justified in terms of benefits achievable and the money would have been better spent on smaller projects. But politicians love grandiose schemes. Reality seems to be finally sinking in on the national scene even if not yet in London.

Roger Lawson

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ULEZ Had Minimal Impact on Air Pollution

According to a new study by Imperial College, the Ultra Low Emission Zone (ULEZ) had minimal impact on air pollution in London.

The researchers used publicly available air quality data to measure changes in pollution in the twelve-week period from 25 February 2019, before the ULEZ was introduced, to 20 May 2019, after it had been implemented. They controlled for the effects of weather variations, and then used statistical analysis to look for and quantify changes in pollution.

They found that, compared to the overall decrease in London’s air pollution levels, the ULEZ caused only small improvements in air quality in the weeks following its start date: an average reduction of less than 3 per cent for nitrogen dioxide concentrations, and insignificant effects on ozone and particulate matter (PM2.5) concentrations. They also found that the biggest improvements in air quality in London in fact took place before the ULEZ was introduced in 2019.

Although London’s air quality has been substantially improving in recent years, that improvement is down to other factors such as newer vehicles in use, and central Government measures such as tax incentives. The ULEZ scheme, and particularly its expansion to cover a lot of outer London, was never justified on a cost/benefit analysis. See our analysis of the ULEZ here: https://www.freedomfordrivers.org/environment.htm . Its introduction was clearly motivated by financial revenues to the Mayor and TfL, not by health benefits.

You can read more details of the study from the link below but the comment that air pollution in London causes 4,000 deaths per year is simply wrong.

https://www.imperial.ac.uk/news/231894/london-pollution-improved-with-evidence-small/

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The Changing Face of Car Ownership

The way people buy cars has been substantially changing in recent years. Few people buy new cars for cash – indeed it is quite difficult to do so with attractive leasing or hire purchase options with very low interest rates being pushed on you by dealers.

Car supermarkets offering a range of vehicles with click and collect purchasing systems are now common. You can now select a vehicle over the net and even have it delivered to your door.

Now there is a further revolution being promoted by a company named Onto (www.on.to) which have been advertising on television. They are offering an “all inclusive electric car subscription”. You need only commit for one month, with no deposit, and servicing and breakdown cover is free, road tax is included, insurance is included if you are over 35 and charging on public networks is free.

For as little as £399 per month you can hire a Renault Zoe ZE50 with a range of 190 miles – see photo above. They also offer Volkswagen ID4 and Audi E-Tron models but at higher prices. In comparison the Renault’s list price starts at £27,595 so at £4,800 per year to hire you can see that it makes for a very attractive financial option particularly as it removes the worry of batteries degrading over a few years.

Onto has been in business a couple of years and there are other subscription services such as Care by Volvo, Elmo and Cazoo.

You can see that the electric car rental option might be very attractive for those who do relatively low mileages.

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Car Usage Increases in Lambeth

The London Borough of Lambeth is one where there is very strong opposition to the Low Traffic Neighbourhood (LTN) schemes that the council has introduced. That includes a legal action pursed on behalf of one disabled resident by a group called One Lambeth. A judicial review challenge was rejected by the High Court in June but they are appealing and raising funds to do so – see https://www.gofundme.com/f/jzgfd-appeal . Please support them.

Now we learn by an article in the Daily Telegraph (see link below) that one of the objectives of the LTNs which is to reduce traffic has clearly not been met in Lambeth. The number of residents applying for parking permits actually rose by 18.6% between 2019 and 2020.

That is contrary to the general trend in car use in London in recent years. Clearly the policy of discouraging car use encouraged by Grant Shapps and some London councils is not working.

Cars are simply too valuable a mode of transport while most people won’t take up cycling as the main alternative. The Covid epidemic has actually increased the demand for private car use as people are wary of using public transport. The latter has also been discouraged by cuts to bus services.  

LTNs do not provide the benefits that are claimed for them. They should be scrapped which is what a majority of residents in Lambeth and other boroughs want.

https://www.telegraph.co.uk/news/2021/11/13/car-usage-appears-increase-london-borough-low-traffic-neighbourhoods/

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Electric Buses in Bromley

London’s buses are one of the major contributors to air pollution in the capital, mainly because most of them are still diesel powered. There are a number of hybrid or electric buses being purchased particularly for central London routes where battery electric buses are viable.

Such buses have limited range however and can only be charged in depots. But there was a presentation by TfL to a Bromley Council Committee of the possible acquisition of electric buses that use an overhead pantograph to do “opportunity” charging whenever a bus is stopped along a route. This could be a viable option for the 358 route from Orpington to Crystal Palace.

A similar system is already in use in Harrogate and has clearly been a success. The buses only take 6 minutes to fully charge from an overhead mast.

Comment: this seems an eminently good idea. Let us hope it is pursued with adequate funding.  

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Transport Committee Reports on Smart Motorways

Parliament’s Transport Committee have published a report following their inquiry into Smart Motorways (those where the hard shoulder is turned into a running lane).

There is grave concern among the motoring public about the safety of such roads which were introduced a few years ago without any real evidence on their safety. There were 15 deaths on motorways without a hard shoulder in 2019 and several coroner’s reports criticised the safety of these roads.

The Transport Committee recommends more emergency refuge areas, an inquiry by the Office of Rail and Road into the effectiveness of stopped vehicle technology and revisions to the Highway Code. But it is unclear whether these changes will have any significant impact on the safety of such roads.

The National Highways organisation (formerly Highways England) are even running an expensive advertising campaign telling drivers to “Go Left” if they breakdown. This makes sense if there is a hard shoulder, a nearby exit or a nearby refuge area, but otherwise if there is not it simply puts the vehicle into the left-hand lane typically occupied by HGVs. This is the most dangerous position to be in as such heavy vehicles will demolish small cars and likely kill the occupants.

This is surely a misconceived piece of advice in response to concerns about accidents on motorways.

Comment: Smart motorways have been introduced as a way to maximise traffic capacity without spending more money on widening motorways. In other words, road safety has been compromised on the alter of economics. There was never a proper cost/benefit analysis of smart motorways which are expensive to introduce and manage.

All lane running also creates problems for the police and other emergency services when accessing accidents because typically all lanes are blocked when an incident occurs and there is no hard shoulder.

As with LTNs, the Department for Transport seems to be poorly led, produces policies which are irrational, and in this case dangerous.

We suggest that the expansion in the number of Smart Motorways should be halted and more money spent on improving road capacity by other means.

Transport Committee Report:  https://committees.parliament.uk/publications/7703/documents/80447/default/  

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