Substitution, persuading passengers to switch from coaches to budget rail or ridesharing, is another dynamic in the long-distance transport market. Newer digital platforms have allowed passengers to easily compare prices and journey times across different modes of transport. This has made it easier for consumers to substitute coach journeys with alternative options. Today, while coach travel remains highly cost-effective, budget rail operators have introduced discounted advance tickets, and ridesharing apps offer rapid point-to-point journeys.
"In the past, coach travel was the only viable low-cost option for students and budget-conscious travellers," says transport analyst Sarah Jenkins. "But with the growth of split-ticketing websites for trains and peer-to-peer carpooling platforms, the choice set has expanded significantly. Passengers are far more willing to switch if coach fares rise even slightly."
Evaluate two factors which may determine the value of the price elasticity of demand for intercity coach travel.
