How to more than triple a system's profit through last mile airport shuttles.
**LONG POST SUMMARY** Build something like the LAX SkyLink or the JFK AirTrain instead of directly connecting your network, set its fare to $10.00, and then sit back and watch it print money.
This emerged from a thought that if you have a particular captive audience, the new feature to set individual fares and fare groups enables pricing discrimination and the ability to charge certain POPs far beyond what would they would willingly pay on average. Airports are a fantastic target for this, because they are a large, concentrated destination and the POPs have special rules regarding calculating commute time and (very important) parking costs that make the more likely to take transit, regardless of the cost. This wasn't available as an option before, as the maximum fare was capped for all rides at $10.00. But now, with the ability to set fare for each line and charge it again, you can go over that limit so long as passengers are willing to transfer and pay again.
To experiment, I set up a basic system in Chicago. Five lines radiating out from the Loop around the city, including a Blue line facsimile going to O'Hare. Charging $2.50 for the network ended up with $398m/day in revenue and $213m/day in profit. Reasonable enough, but its still going to be slow to expand if played normally.
So then, the experiment was simple. I terminated the Blue Line one stop short and built a light rail route to bridge the gap of approximately one and a half miles. Four trains of two cars allowed it to run at two minute frequencies, and I moved it to its own fare group and set that to $10. How many POPs would keep coming to O'Hare by rail now that the cost of a trip was five times what it was? Turns out, quite a few.
The original O'Hare station was getting 56k passengers daily. The new one only lost 2k riders, so 54k were taking this new $10 line. At my standard fare of $2.50, I would have had nearly double the ridership across the entire network to get that, which would have cost multiple billions of dollars. Instead, I got the same financial result for building two light rail stations and a mile of track for less than $100 million. My system's revenue was up more than 50%, to $630 million, doubling my profits to $400m/day.
Naturally, the question arose, "If they'd pay for one shuttle, why not two?" So I pushed the Blue line back another station, and built a second $10.00 fare shuttle to connect that to the first. The original O'Hare station was getting 54k passengers daily. Now, we dropped down to 36k. Interestingly, almost none of the losses were traveler POPs. O'Hare has a second demand point for around 25k airport workers coterminous with the first, and that lost almost all its rail commuters. The plane travelers, with their different pathfinding and pricing rules, did not mind. So instead of 54k paying $10, I've now got 36k paying $20. More profit, close to $550m/day now.
And so again I took out another Blue line station and put in a third extortionary shuttle. And guess what? I only lost around 6k riders. While the original system had 56k people paying $2.50 to get to the airport, here there are 30k paying $30.00 each for the same ride. I'm making $691m/day in profit. That's more than triple the original system. Revenue has increased more than $500m/day to $909m/day, and expenses only rose $30m/day. Punch those numbers into a calculator and it'll display a happy face.
Sadly, this appears to be a plateau. A fourth shuttle finally caused serious decline in ridership, down to 18k, and as such a slight dip in total revenue and profit, back close to $800m/$600m. I guess $40 to get to the airport is around their breaking point for a ride that's not even faster than than driving.
Overall, this is absolutely incredible for getting cash to expand your system, and I'm adding it to my bag of tricks and exploits moving forward. Even in short daily challenge where the goal is total ridership, this is so cheap and lucrative that running a last mile airport shuttle for just a bit and then removing it before the last day could probably pay for an extra full line or two at the end.