FirstGroup’s Greyhound arm hit by lower fuel costs
Transport giant FirstGroup today said it was on track to hit its full-year targets, despite passengers deserting its Greyhound coach business in the US due to falling petrol prices.
The Aberdeen-based group said falling costs at the pumps meant more travellers were taking to their cars instead of its coaches, leading to a 1.1 per cent fall in revenues at Greyhound since the start of October.
Chief executive Tim O’Toole said: “Demand for Greyhound’s traditional services has lagged the US economic recovery, with the disposable incomes of our core customers not significantly increasing with the improvement in the overall macroeconomic environment for much of the financial year.
“In the period, this demand challenge has been exacerbated by the significant and rapid fall in consumer fuel prices, which improves the affordability of using private cars for some trips compared with Greyhound.”
But the firm, which recently lost its ScotRail franchise to Dutch operator Abellio, said passenger volumes at its UK bus business grew 1.4 per cent and revenues were 2.7 per cent higher than a year ago.
O’Toole said: “Overall we are on course to meet our full-year expectations for the group, and we are confident that our multi-year plans will deliver improved cash generation and create sustainable value over the medium term.”