Investor query

As an investor, I am interested to know what route Snap are now going down since you seem to have given up on the intercity travel and be focussing on commuter travel.

Right now, there is decent demand for intercity coach travel and that is being proven with Flixbus setting up and National Express adding in duplicates because of the demand. You also have coach operators who are on the brink of collapse and some of the extra revenue could really help the industry. Purely for example, todays #HonkforHope event in London could have given operators a chance to use Snap to carry people into London and help the operators travelling the 100+ miles, get some revenue back for the journey which they were making anyway.

Given all the promotion that I have done to try and help Snap grow, it feels like a kick in the teeth that now you have given up on what was the main source of income for Snap and also given that the vast majority of people invested into Snap because of the intercity travel and not commuter services.
I fully appreciate having commuter services as a sideline project but with it becoming the main project (as would be assumed with the Republic of Snap data for intercity travel being basically scrapped and it’s not all for Covid Secure commuter travel).

I would like to ask is there an intention to bring back intercity coach travel shortly or is the focus going to be on commuter buses from here on in?

Regards,
Mark

Hi Mark,

Thanks so much for reaching out to us.

I’d like to assure you that we most definitely have not given up on the intercity services. It is, and will remain, at the core of Snap.

The reason we have not restarted the intercity services yet is actually because we’re acutely aware of the financial position in the industry, and we don’t want to risk putting any further financial strain on our operators until we’re absolutely confident there is sufficient demand in the market.

The way the Snap model works is that, for intercity services, once a trip is listed on the platform, the operator is obliged to run it. We want to make sure that when we relaunch the intercity product, we’ll be feeding our operators profitable trips.

The commuter proposition is different as until we have sufficient sign-ups for a route, no wheels turn. Therefore, during the quieter period, we can focus on this and see if we can generate an alternative source of income for both ourselves and our operators.

We are using a number of data sources to judge when demand is sufficient to relaunch intercity. But you can be absolutely sure that it is, and remains, a core part of what we do and, were it not for Covid, a product we’d now be expanding nationally.

Thanks for getting in touch and I hope this provides some reassurance regarding our future plans.

Best regards,

Thomas and the Snap team

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Hi Thomas, thank you for your response.

I must say that the messages which were put out suggested different and looked more as if you were heading towards only commuter travel.

As for the intercity services, I would argue the potential usage right now is huge and that is proven with how quickly new routes from the big companies are starting up and how many duplicates keep being added, you could just go back to ‘still building’ trips temporarily and increase the ‘minimum price’ slightly to ensure that all trips make a profit. At this time, coach operators are running a lot of dead millage to some of the contracts so I think it is certainly worth you still working with the operators encouraging them to put dead millage trips on the system.

The fact that Megabus, Flixbus and NatEx are selling out coaches and rapidly putting the network back to 100% in some areas, there is clear demand and it’s the time to capitalise on that, not step back. By holding back so much and for so long, existing regulars will have gone to other companies and you will have to win them back.

For the commuter travel, I can see your point that no wheels turn until there is profit to be made but I do see that a lot of people are starting to lose faith in Snap thinking that the company has given up and changed their way.

I’m glad that the team are still open for Intercity travel and I do hope that it comes back soon before it is too late.

Regards,
Mark