Saturday, June 11, 2011

Cost Analysis of Transportation

It's often been said that the largest beneficiaries of government spending on public transportation in the USA is drivers. That is to say that each time enough money has been invested in public transportation options to pull a single driver and his car off the road, the reduction in road congestion is a stronger benefit to those who remain on it, than to the individual who is now riding the bus/train/bike etc. Why is this?


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I think it's because the current public transportation infrastructure is not capable of serving a large and varied number of people well. The US is a big place, so you wouldn't expect to see a vast network of trains and buses covering everything. There's just too much room. What this means, then, is that most of the people who will ride public, already do, because they're in the right conditions to do so. The incentive needed to generate new riders is tough (and expensive) to create. The instantaneous ratio of cost-to-benefit is so high that little development gets done, because very few decisions are made with the distant future in mind.

Contrast that with the relatively compact country of Switzerland, that has already heavily invested in public transportation throughout. With an already dense set of rails and local city transportation routes blanketing the terrain, imagine what happens when the decision is made to lay new track at the end of an existing line to reach a small village just beyond. With just the capital cost of the short extension of the rails, and an incremental increase to the operating costs, the entire village now has a direct vein into the country's entire transportation network. The cost/benefit ratio is much shallower at this stage of development.

Putting aside some growing fears about reaching the capacity of current major rail connections, it seems fair to say that the public transportation setup is very powerful in Switzerland. And because the duration of my stay is uncertain, and not likely to be many years, I intend to make my decisions regarding transportation plans for the next year based on the same method as those who now lay the rails - the calculation of an instantaneous cost/benefit ratio.

Practically, what this means is that I immediately reject the idea of purchasing a car. This is to be a somewhat rigorous analysis, so I'll at least explain why: There are no true 'inexpensive' automobiles over here. Look around, and it's hard to find an old rusty-red Toyota of the type you'd see in the 'States, that many a college student kept running with duct tape and WD-40. What would you charge for such a vehicle? What kind of a rail pass would the same money get you? It's obvious that a decent public transportation system drives the demand for these sorts of junkers through the basement. (Incidentally, while I understand why nobody wants a junky old car, I'm still not sure exactly where they go. Shipped off to Siberia? If I find out, I'll be sure to update.) Space is also at a premium over here. Unless you own a house in the country with some land, odds are you'll be renting a garage along with your rented apartment. ...and they're not exactly cheap. So without several years to spread the inescapably relatively hefty cost of a vehicle out over, public transportation is a must.

Now, I need to figure out which option works the best for what I need. (Wisely, the operators of the transportation system have dissected their product into several parts, and done their best to differentiate between them. The most obvious of these is the use of 1st and 2nd class seating on trains, but that's a subject for another time... Suffice to say, 2nd class is perfectly suitable.)

The major options I've identified are:
1) Purchase of individual tickets on a case-by-case basis. [Example: CHF 23.60 round trip to Zürich]
2) Purchase of the 'half-fare' card, which is exactly what it sounds like, followed by the purchase of individual tickets (at half price!) on a case-by-case basis again. [CHF 165 + each half-price regular ticket]
3) Purchase of a local network pass, which will allow free passage throughout all of the Kanton (State) of Zürich. [CHF 2043] Could be coupled with a half-fare card for travel outside the Kanton.
4) Purchase of a GA card, which will allow free passage throughout all of the country of Switzerland, except for a few 'touristy' mountain routes and such, for which the GA functions simply as the half-fare card. [CHF 3300]

Obviously, there is more to these options than just the money involved. The half-fare card is a good value (I got it when I was here in 2007. I only stayed for 8 weeks, but it still paid well for itself within that time.) However, there is a certain convenience in not having to purchase tickets regularly, which would come from option 3 or 4. I decide to keep these issues in the back of my mind while I perform the analysis on the costs, leaving them to perhaps sway a close result. The major challenge of this analysis is the uncertainty of my future travel plans. That, and I'm jonesin' to make a graph. 'cause I like graphs.

Consider: I can divide my travels into two categories - 'definite', and 'probable'. The 'definite' travel costs are those that I absolutely expect to incur throughout the year. The 'probable' travel will be my best guess as to the remainder of my travel. I can then create a chart showing how the different options stack up against one another as the probable costs vary. The sensitivity to the probable costs can then be seen, and a much better guess of the optimal choice can be made.

Definite Costs -
2 weekly trips to Zürich for Bible study on Wednesday and Saturday evenings. [Regular cost, CHF 23.60 round trip] The tickets are good for 24 hours, so meeting with the group on Saturday mornings is available on the same Saturday ticket.
3 yearly trips to various parts of the country for the larger gatherings. [Regular cost, ~100 CHF each]
Bus transportation within the city of Winterthur, during times when I just can't walk in the elements. (I hesitated to put this down, but I think it's safe to call this 'definite', with a little more added under probable'.) [Regular cost, CHF 9.20 per trip x 20 trips/yr]

Probable Costs -
1 more weekly trip to Zürich. [Regular cost, CHF 23.60 round trip]
Daily commute by bus across town. [Regular cost, CHF 9.20 per trip x 70 trips/yr] (Based on what I've been told, I'm expecting three months of either bitter cold, or sopping wet weather, making a 25 minute walk a drudge. 90 days - 20 days from the Definite category, leaves 70.)
Vacation! [Regular cost, CHF 200, x 6 trips per year.] I'm not really sure where I'd go, but all of these options provide transportation within Switzerland only. If I take a train to Paris, I'd still have to pay regular price for the leg across France.

Okay. Adding these up, I get 8 different values: a 'definite' and a 'probable' cost for each of the four options. I multiply the 'probable' cost by a factor to account for its uncertainty, and plot these against this uncertainty factor in the following graph.


The values listed for each option are the total costs ('definite' + 'probable'). The probable costs have been scaled by an 'uncertainty factor' however, to show the influence of these costs which I'm guessing at. Right in the middle of the graph, where the uncertainty factor is equal to 1, the values shown represent the total costs if my assumed 'probable' costs were exactly used. At the far left side of the graph, the 'probable' costs are reduced to nothing and the values are a simple comparison of the 'definite' costs. (Note that if only my definite costs were being incurred, even buying full price tickets would be better than the GA card.) At the far right of the graph, an 'uncertainty factor' of 2 shows what happens to the total costs of each if my 'probable' travels are doubled. I doubt that I've estimated them that badly, so the graph should contain the costs of my next year's travels somewhere in it.

I've included a feature of Option #3, which uses the half-fare card for travel outside the state if it's worth it. However, this only is true for low 'probable' costs, so you can barely see the line for Option #3 bend at the far left of the graph. This implies that for option #3 to really work, I'd need both the Kanton pass, and the half-fare card.

One thing is certain, for long-term travel plans, I cannot keep buying full-price tickets. The reality is, my other three options are very closely bunched together. Only about CHF 350 separates them. If my assumptions are perfect, the best deal is actually the Kantonal (State) pass. This would have the advantage of not needing to buy a ticket before each ride, for the majority of my trips. On long journeys, though, I would still need to secure any local fare after arriving. With the GA, I'd be able to jump on virtually any public transportation without thinking.

The analysis indicates that my options are very similar in cost. They are also not very sensitive to uncertainty of probable travel plans. If I've over-estimated the probable travel costs by 20%, I still feel comfortable with the nearness of the results. If I've under-estimated the probable travel costs by as much as 100%, the difference between Option #3 and Option #4 is still about the same.

With sheer convenience ultimately tipping the scales, I've decided to purchase a GA, (Option #4). At the end of one year, I'll reevaluate.

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P.S.
At over $40 per week in gasoline, $450 every 6 months in insurance, and regular routine maintenance, my car back home cost a comparable $3200 per year. ...and even that was only once the car was entirely paid for.

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