Coach operators have warned the government that they risk financial collapse if they are not given urgent support, with passenger numbers and bookings plummeting during the pandemic.
Many coach and bus firms are paying heavily for finance deals on vehicles that are sitting idle. Some worried bosses have said that their fleet will be repossessed within weeks if something doesn’t change.
In response to the calls, the DfT said that it would work closely with the coach sector. However, coach firms have said that it is already unfair that they haven’t received the same funding as bus companies to meet their lost earnings, from cancelled trips and from the reduced capacities required to maintain social distancing.
Some coach company owners even have personal guarantees on their coach fleets, so a single default risks bankruptcy – especially as the only support to date has been the employee furlough support scheme, rather than any financial business support.
Although councils have been able to offer smaller grants – say a single payment of £5,000 to affected companies, many have fleet repayments each month that match this figure alone.
North East Coach Travel in Newcastle is just one of the industry’s businesses calling on the government to make lenders offer more generous repayment terms. The company has said that if no government support is forthcoming, and if lockdown persists, the industry may not be there in future.
The situation has been made even worse by the fact that coach companies have not been included in the rates relief grant, with ministers determining that the sector didn’t fall within tourism, hospitality, leisure or travel. Furthermore, research suggests that up to 85% of coach firms haven’t received any kind of grant at all, with operators now facing an even more challenging position over winter when traveller numbers tend to fall anyway.
The DfT said that it recognised how hard the coach sector had been hit by Covid and that it was working closely to offer support and to anticipate further challenges down the line. It added that the Chancellor’s Winter Economy Plan would help to outline the specific support on offer for UK businesses.
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