Innovation can come at a price

It was one of the strangest sales leads ever. A gentleman asked what it would cost to buy a new coach outfitted as a rolling gym: stationary bikes, weight machines, treadmills—all stuff I’d heard about but would never try.

We discussed all the things that could go wrong, but he remained committed to the concept of combining commuting with aerobic exercise.

Visions of barbells rolling down the aisle danced through my head, so I did the only practical thing: referred him to my competitor.

“May you live in interesting times” is an old Chinese curse that seems applicable to the motorcoach industry. The economy is thriving while the bus business is struggling. Costs are rising and drivers are scarce, while many of our customers find themselves able to afford (in their view) better forms of transportation.

To counter that trend, some operators are trying innovative concepts to attract new riders. As an aging malcontent, my predictable prediction is that some will succeed and some will fail.

There are only a few reasons a “new” idea hasn’t already been tried. One is that the idea is truly revolutionary, so no one else has thought of it. It may be newly practical because of technological advances. Frequently the opposite is true; it’s been considered, maybe attempted, and ultimately rejected because it doesn’t work.

There can be geographical and market concerns. A “sleeper bus” may not make sense on a Philadelphia to NYC route. But every business has its “center of gravity,” and each is different. Motorcoaches are very expensive and have long service lives. Margins are thin, and we depend on residual value to make things work financially. We are a very conservative industry because mistakes in equipping buses can haunt us for a generation. Mess up a truck spec, and you live with it for five years, but a bus boo boo lingers for 20.

One operator thought that 2+1 seating might offer a boost for his scheduled route. Rather than spend millions on new coaches, he refurbed some aging buses, installed new 2+1 seats and took a run at it (pun intended). If they failed, he could unload or reconfigure the older buses without crippling his company.

Buying, or modifying, an expensive coach in a way that’s significantly different than the norm is like turning onto a one-way street. If it gets you where you want to go, great, but be certain before making the turn. Backing out can be dangerous.

When it comes to unique equipment alterations, treat them like major surgery. Are the potential rewards worth the risk? Who’s responsible if they don’t work as planned? Is there a long term market for the new concept? Will modifications require expensive maintenance, or expose you to extra risk (like barbells rolling down the aisle)?

There are other things to consider as well. Will they void the manufacturers’ warranty, run afoul of regulatory standards, or make the bus overweight? You don’t want to own an expensive bus you can’t legally operate.

Assuming the idea is a resounding success, the coaches will eventually wear out. Is there a secondary market for them, or can they be economically converted to something easy to sell? Those considerations need to be plopped into the business model.

Harland and Wolff had a great idea. They built a ship with watertight compartments enabling them to cut back on lifeboats, because, as one magazine said, it was virtually unsinkable. Not only did they save money on the boats, they made passengers happy with extra deck space for shuffleboard and sunbathing. What could go wrong?

Magazines aren’t always right. That innovation worked out poorly for the Titanic.


Share this post