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Agenda

Agenda. Development of long distance Coach market in case of Germany. APC- 10 year‘s anniversary meeting, Riga, 05. Septemer 2013. Situation. Change of regulations in the beginning of year 2013 Up to then, utmost protection of competition for railway by laws

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Agenda

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  1. Agenda Development of long distance Coach market in case of Germany APC- 10 year‘s anniversary meeting, Riga, 05. Septemer 2013

  2. Situation • Change of regulations in the beginning of year 2013 • Up to then, utmost protection of competition for railway by laws • Only from and to Berlin significant services by coach • Market share approx. 0.1 % of the total transport market • 3 companies operated a network within Germany, some SME‘s operated • airport transfers • Since January, very dynamic development

  3. Situation The liberalization of the German long-distance coach services attracts a number of new stakeholders and companies • Market – including single lines • operated by over 50 different • coach suppliers • There are various international • companies, prepare the market • entry or already have implemented • After hesitation, the Deutsche Bahn AG • as the current market leader interested • at a further expansion in the Coach market Active Interested

  4. Situation In a short time have formed highly competitive lines Coach network – March 2013 Operators

  5. Situation Against the background of liberalization, the line network in the long-distance coach traffic has greatly increased (2012: 40 routes, 08/2013: 160 routes), and will expand further Structure National lines No Exact number No Exact number Numbers of lines 03/2013 Planned opening international lines Planned opening lines from 04/2013 1) In cooperation with existing operators

  6. Forecast The forecasts for the market share of long-distance bus in Germany vary widely, a turnover of up to € 1 billion per annum possible FORECASTING MARKET SHARE long-distance bus (BASE PKM) Coach Coach Plane Plane Rail Rail Car Car Turnover Coach: In addition to the fluctuating forecasted modal split shares isthe question of absolute market size

  7. Forecast SALES & CUSTOMER SERVICE OFFER, PRODUCT & PRICE Coach PRODUCTION / OPERATIONS TERMINALS For Germany can be expected from a rapidly growing coach market, but also has the need for development. Challanges for market development

  8. Forecast The growing distance coach traffic represents many challenges to market participants - but it also offers opportunities (1) NETWORK PLANNING, MANAGEMENT AND PRODUCT PRICING • Opportunities • Many large cities directly connected by highways • High Price level & capacity constraints at DB long-distance traffic • cooperation between operators - with common brand - with franchise models • cooperation rates, for example with airlines or transport associations • perfected yield management method • Challanges • “tracking" attractive routes with connections other cities • differentiation from other coach operators • product positioning (low cost?, Standard? Premium?) • Optimal price level? • price reactions DB long-distance + DB Regio • entry of new competitors train

  9. Forecast The growing distance coach traffic represents many challenges to market participants - but it also offers opportunities (2) SALES & CUSTOMER SERVICE • Opportunities • High acceptance of Internet sales • Special search and booking platform • booking and yield management tools available on the market • sales cooperation, for example between coach operators, with Retail and with local public transport providers (including CityTicket connection) • Mobile sales and additional services • Challanges • sales competition between coach operators (and also to Sales service) • Customer Information • conflict Customer vs. Low-cost structure • on-site customer support in case of failure • passenger rights

  10. Forecast The growing distance coach traffic represents many challenges to market participants - but it also offers opportunities (3) PRODUCTION / OPERATIONS • Opportunities • New Business Models for Service Providers • Central Coordinators as an interface between different operators and • CCT • handling agents • Full range of coach companies • Nationwide manufacturer workshop network • collaborations with public transport providers, for example for • workshop use or on-site operating personnel • Challanges • Connections <> overall stability (high susceptibility to interference in • cities and highway) • "major combat days" (start of the holidays, before Christmas, etc.) • decentrally parking of vehicles • Accommodationstaff • personnel scheduling: optimum between buffer and efficiency? • infrastructure availability and quality (see also next page)

  11. Forecast The growing distance coach traffic represents many challenges to market participants - but it also offers opportunities (4) Terminals • Opportunities • State of the art terminals, when municipalities implement new • PPPs or exclusively private investment: CCT as "shopping and service center with coaches “ • Coach connection can promote accessibility and tourism • Cooperation between providers and local authorities (e.g. Marketing support) • Challanges • Few real coach terminals are available in Germany • Financial needs of municipalities / responsibility open • Optimal location and affordable access for coach connection • Customer information (especially at unstaffed bus stations/terminals) • overload risk: Concentration of departures at certain times and days • of the week • Limited Knowledge about conditions and needs for infrastructure • in long-distance coach transport

  12. Summary The long-distance coach has shown in a short time many innovative approaches, yet still tackle some challenges. SALES & CUSTOMER SERVICE OFFER, PRODUCT & PRICE Active and flexible product management Development of forms of distribution Yield Management Target group oriented marketing Coach Link with other transport modes Common marketing coach and city PRODUCTION / OPERATIONS TERMINALS Reliability even at peak times Creation and funding of the necessary infrastructure Efficient (remote) control of the operation Marketing coaches towards cities

  13. Summary We expected in the medium time a significant growth. After that, it will give a phase of consolidation at the supplier, but also an adjustment of the value concepts POTENTIAL MARKET STRUCTURE Main operators Specialists Medium to long term:4-6 companies Supply / network planning Productmanagement & Pricing Sales & Costumer services Production & operation Vihicles Terminals / CCT / virtual stations

  14. Contact Stefan Christian – President Rüdigerstr. 46 10365 Berlin - Germany Email: Stefan.Christian@online.de Tel. +49 (0) 151 27665212 14

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