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In the December 2018 issue of Capital Magazine, Stephen Franks predicts that “driverless vehicles” are likely to “send passenger rail the way of the horse.” He argues light rail to the airport is “a white elephant vanity project.”

Warren Buffett is often quoted as saying that he only invests in businesses he understands. Stephen rightly assesses light rail as an investment, but it seems nobody has explained to him how the business works, as nearly everything he assumes about light rail is wrong. The caricature he offers is unrecognisable to anyone who has lived in a city with a modern light rail network.

The business model is best described as Netflix for Mobility — the business may sell the odd single-ride ticket, but what it really does is sell monthly subscriptions for all-you-can-eat transport on light rail, buses, trains, ferries, bike-sharing, etc. In the same way that today you sign up for a mobile phone plan for your communication needs, in future you will choose a mobility plan that meets your transport needs. Your subscription rolls over each month until you cancel it. (It’s not clear that NZTA staff understand this, since they are planning to implement a national “integrated ticketing” system — a ticket to ride is very different from a subscription to a mobility service.)

Making the model work means maximizing ridership and maximizing the productivity of the light rail assets. So the core offering is rapid transit — frequent, fast service, all day, every day. Contrary to Stephen’s assumption, commuters are not the primary target customers; successful rapid transit has to connect people to multiple destinations with all-day demand, like the hospital, shopping areas, education campuses, major suburbs, and the airport, not just serve the city centre. Making the service as fast as possible is a double winner: it makes the service more competitive with travel by car and makes the assets more productive, so the business can deliver a higher frequency service at no extra cost.

Scale is everything. The light rail line needs to be long enough to connect enough places to offer a diversity of trips attractive to many different people. If the line is too short, any travel time savings are lost in transfer penalties when people transfer to and from feeder buses. This is why, as Stephen reminds us, the business case for light rail in the PTSS was so poor. The PTSS compounded its short line problem by choosing a slow light rail route on the Golden Mile. (Under North American light rail guidelines, if light rail and pedestrians share a space like the Golden Mile, the speed limit is 20 km/hr.)

Let’s be clear. The PTSS showed that the business case for one particularly ill-conceived light rail project doesn’t stack up. But to conclude that therefore all light rail projects are uneconomic is just silly. Well-designed light rail projects create a string of pearls — the pearls are places of demand and the string is the line connecting them. Unlike the λ-shaped split route in the PTSS, a successful light rail line forms a long string with big pearls. Above about 3500 passengers per hour, the total cost of light rail ownership (capital plus operating) can be less than that of buses.

Stephen’s hypothetical light rail service “moving heavy mostly empty carriages outside peak hours” is set up to fail. Unless all day, every day demand is designed in, the business model will not work. The test of a light rail proposal for Wellington is not that it will be busy during the peaks — that’s easy; the real test is that there is evidence of demand during off-peak times and on weekends. Given Wellington’s size and population density, a line along the high density corridor connecting the railway station, city centre, hospital, Newtown, Kilbirnie, Miramar, and the airport is probably the minimum economically viable product. A line designed primarily to move people between the airport and CBD would be a colossal waste of money. Toronto, with the busiest airport in Canada, can’t make an airport line pay; Wellington has no hope of doing so.

It’s a questionable proposition that given a choice, people prefer to travel on their own rather than travel with others, such as on light rail. That’s not why we choose to live in cities. We go to concerts, movies, plays, sporting events, offices, universities, pubs and cafes, even shops, for the experiences of being among other people and interacting with them. Transport is no different. We live in cities because they give us more choices, including transport choice. For at least the last 50 years, we have designed transport choice out of our cities and it’s time to design it back in. If Stephen prefers to travel by himself, perhaps modern urban living is not for him.

Contrary to Stephen’s assumption, self-driving cars and light rail (also self-driving by the time Wellington builds it; Vancouver’s SkyTrain has been self-driving on a segregated right-of-way for 20 years) are complementary rather than in competition. On busy transport corridors in space-limited urban areas, a single light rail lane can move at least 5 times as many people as a single vehicle lane, whether it’s people or computers driving the cars. Self-driving cars are an excellent solution to the “last mile” problem — getting people from a light rail station to where they live. Currently, most overseas suburban light rail stops provide for cyclists, feeder bus services, and kiss and ride, as well as medium density housing close to the stops. Self-driving cars add another option and eliminate the need for park and ride space.

Stephen worries that light rail will “block other traffic.” Apparently it’s news to him that the professionals who design light rail lines have thought of this, modelled the effects, and tested the models in real life, in many different places. In short, if a high frequency light rail service crosses a busy road, invest in grade separation. For example, in Wellington a light rail line on Taranaki St would cross SH1 and it would be a good idea to extend the Arras Tunnel west, so the light rail line goes over the top of the highway. Cities have also learned the hard way that if you get it wrong and don’t invest in grade separation where necessary, it’s really expensive to fix mistakes. (Under North American light rail guidelines, grade separation is warranted if peak traffic volume exceeds 900 vehicles/lane-hour.)

To sum up, light rail that’s a Wellington investment rather than a vanity project will:

  • have sufficient scale that it reaches major destinations, enabling access to education campuses, office complexes, hospitals, shopping areas, and major suburbs, as well as the CBD and airport
  • form the heart of an integrated mobility network, with reconfigured bus lines serving major light rail stops and a pricing structure that encourages easy transfers to and from buses and trains
  • deliver a rapid transit service, where the frequency, reliability, travel time, stop spacing, and quality of service make light rail journeys competitive with travel by private vehicle
  • progressively tie the city together over the next 50 years, with light rail lines spanning the city from urban fringe to urban fringe via the city centre, fostering transit-oriented development around stops

A number of Canadian cities have done this well, such as Vancouver, Edmonton, and Calgary. If Wellington can replicate their success in a way that’s adapted to our local conditions, I’m happy for Stephen to call me a light rail zealot. People who start successful businesses are all pretty zealous. Otherwise, their businesses don’t succeed.

Page last modified 08 January 2019 at 10:26 AM