Vonlane successful

[RichardK]

It seems Vonlane has hit the mark with their business model. Here is a good booking for the 3:00 trip to Dallas for today.

Load factors have been increasing. Facebook posts are all favorable.

 

[rickycourtney]

It's a very interesting business model. I'm happy to see them doing well and I'm curious to see if the concept catches on in other cities.

 

[railiner]

Always like to see a well-run operation succeed. Have they incresased routes or frequencies yet?

 

[RichardK]

Houston service is expected to start in early 2015. New coaches are on order.

They added weekend service and have been experimenting with different departure times.

For example, yesterday they announced a new departure at 6:00 PM from Dallas to Austin, saying this is the only departure of any kind from the Love Field area to Austin between 6:10 and 8:25.

The management is very astute in working around and reacting to competition.

 

[Swadian Hardcore]

What are those two items at the very back? Radiator and DPF?

 

[rickycourtney]

In the video on the Vonlane website it appears that there's some sort of coat closet or storage closet in the back of the coach. That's probably what they are showing in the back of the diagram.

 

[Swadian Hardcore]

Interesting, there's two of them and the one of the left seems to be blocked by the rear seats.

 

[RichardK]

Houston service announced.

http://www.bizjournals.com/dallas/news/2014/11/10/exclusive-vonlanes-will-add-dallas-to-houston-bus.html?ana=twt

 

[metrolinecoach111]

It seems Vonlane has hit the mark with their business model. Here is a good booking for the 3:00 trip to Dallas for today.

Load factors have been increasing. Facebook posts are all favorable.

While I agree that these are all positive steps in the right direction for them, I caution the use of the word "success."

Looking at the week ahead and how people have booked, most of their trips leave with less than 10 people/leg. This takes into account that 70% of their bookings are made within 48 hours of the trip, unlike other intercity trips where the booking window is 96 hours prior. If they didn't fill up a Friday afternoon schedule they wouldn't be in business - it's a bad way to measure if they're successful. Higher fares = lower cost allocation and lower break even, but they're not making a whole lot of money yet.

Another issue is that it's geared primarily to biz travelers, which means there's only one peak day of travel (Friday). They're going to have to diversify it a bit to get some more revenue onto each schedule.

Houston - way too early to make that announcement. We'll see what happens.

 

[Swadian Hardcore]

I'm afraid Vonlane is in it over their head.

 

[rickycourtney]

I'm afraid Vonlane is in it over their head.

I think that comment is a bit premature. It's too soon to know if this new route will be successful but the fact that they are feeling comfortable enough with their cash flow to launch it... says something.

 

[RichardK]

They have one advantage over the airlines in pricing policy. There is no penalty for booking at the last minute. If I decided to go to Austin tomorrow, the Southwest fare is either $207 or $238. Vonlane is $100. You can get there 5 minutes before departure.

They are not competing with Greyhound or Megabus. It is an alternative to Southwest, which is the main carrier out of Love Field.

Maybe, they won't make it, but we need more travel alternatives. I am glad they are trying.

 

[Swadian Hardcore]

Yeah, they are feeling comfortable, but not all businessmen think the same way, and not all businessmen make the best decisions, especially in the bus industry.

 

[rickycourtney]

I'll also point out that even if Vonlane is selling an average of 10 seats per run... that's $1000.

By comparison it looks like Greyhound charge an average of $14 each way. Even of the bus was sold out that would be about $700.

The question is if $1000 per trip is enough to cover all the expenses and turn a profit.

 

[RichardK]

It would be interesting to know the break even point. The fixed costs are lower since they do not have any terminals. I suppose the two hotels are not charging them, since Vonlane is dropping off possible guests. Also, passengers can use the hotel services prior to departure, bar, restaurant, etc. It seems mutually beneficial.

 

[Swadian Hardcore]

You're right, but Vonlane has lots of deals and they have to maintain heavily-upgraded H3-45s that'll have some unique parts.

 

[rickycourtney]

You're right, but Vonlane has lots of deals and they have to maintain heavily-upgraded H3-45s that'll have some unique parts.

Actually Vonlane offers *very few* deals (check their Facebook page if you don't believe me) and they don't do dynamic pricing.

Yes they have heavily-upgraded H3-45s, but I imagine they're so new that they don't have any major maintenance expenses at this point. If they did, at this point, it would covered under warranty. The parts they used aren't that unique, but they are more often used on coaches converted for use by VIPs.

The idea to use hotel lobbies as stations is brilliant. Unlike Greyhound they avoid the expense of building and maintaining stations. Unlike the curbside operators they are able to give customers a nice waiting experience. Unlike airlines they don't have to pay to use facilities since they are bringing additional revenue to these hotels in the form of room sales, dining/bar checks and parking fees.

 

[rickycourtney]

Actually the biggest expense for Vonlane has got to be human capital. Unlike other bus operators each Vonlane run has 2 employees on board, a driver and an attendant. But having that attendant to make coffee, serve snacks and act as a concierge is important to the brand.

 

[Swadian Hardcore]

Greyhound tried hotel pickups with NeOn but it apparently failed. Now yeah, that attendant has got to be raising costs about 30%.

 

[RichardK]

You're right, but Vonlane has lots of deals and they have to maintain heavily-upgraded H3-45s that'll have some unique parts.

Actually Vonlane offers *very few* deals (check their Facebook page if you don't believe me) and they don't do dynamic pricing.

Yes they have heavily-upgraded H3-45s, but I imagine they're so new that they don't have any major maintenance expenses at this point. If they did, at this point, it would covered under warranty. The parts they used aren't that unique, but they are more often used on coaches converted for use by VIPs.

The idea to use hotel lobbies as stations is brilliant. Unlike Greyhound they avoid the expense of building and maintaining stations. Unlike the curbside operators they are able to give customers a nice waiting experience. Unlike airlines they don't have to pay to use facilities since they are bringing additional revenue to these hotels in the form of room sales, dining/bar checks and parking fees.

Soon after start up they were offering the 4:00 am departure from Dallas at $40 and the late night back to Dallas for $75. This is now gone. I think you still get an $85 trip for opening an account.

 

[railiner]

Interesting topic....

Having an attendant on board for a maximum of 22 passenger's, seems rather extravagant to my way of thinking. The only other operation's that have an attendant currently, that I am aware of is LimoLiner and Hampton Jitney (on select trips).

I like C&J's business model better....they have 30 seats, also arranged two-and-one, but they have a self-serve snack bar with a K-Cup hot drink machine, a 'fridge' with bottled water and cans of soft drinks, and a basket of granola and fruit bars, candy bars, etc. that passenger's simply help themselves to.

As for using hotel's for depot's....that practice goes way back to the 1920's and 30's, where Greyhound often would use a 'downtown' hotel in a city too small to rate a company terminal. The hotel acted as commissioned agents, and sold tickets, and handled checked baggage and package express as well. That was in the era of the "Commercial Traveler", as traveling salesmen were also known as. They often utilized these hotels and the bus for business travel, as well as the railroad. My grandfather was one of them.

 

[RichardK]

Interesting topic....

Having an attendant on board for a maximum of 22 passenger's, seems rather extravagant to my way of thinking. The only other operation's that have an attendant currently, that I am aware of is LimoLiner and Hampton Jitney (on select trips).

I like C&J's business model better....they have 30 seats, also arranged two-and-one, but they have a self-serve snack bar with a K-Cup hot drink machine, a 'fridge' with bottled water and cans of soft drinks, and a basket of granola and fruit bars, candy bars, etc. that passenger's simply help themselves to.

As for using hotel's for depot's....that practice goes way back to the 1920's and 30's, where Greyhound often would use a 'downtown' hotel in a city too small to rate a company terminal. The hotel acted as commissioned agents, and sold tickets, and handled checked baggage and package express as well. That was in the era of the "Commercial Traveler", as traveling salesmen were also known as. They often utilized these hotels and the bus for business travel, as well as the railroad. My grandfather was one of them.

Those are some good observations. Vonlane does not even have a ticket agent. Tickets are sold online only. No checked baggage. The driver does all the loading and unloading.