income statement

John Tierney
Case study 8
11/2/2013

1) As a late mover into the US intercity bus market, what advantages and disadvantages does Megabus have?

Megabus being a late mover in the US, has allowed the company to learn from past mistakes by companies such as Greyhound, who filed for bankruptcy in the mid 90's and who lost most of it's business due to poorly maintained terminals, high prices for fares and unsafe conditions. Megabus's advantages include fares as lows as 1 dollar, free wi-fi, stylish buses and power outlets. They Can offer these low fares since the company eliminated purchase Windows for tickets, selling tickets online only and by eliminating expensive terminal operations by dropping off and picking up riders at sidewalk stops like public bus operators. There are few disadvantages besides the fact that rising gas prices affect travel and low fare prices affect revenue if quantity is not met.

2) Does Megabus have any overwhelming resources and capabilities?

Yes, Megabus is backed by the full strengths of the second largest transport firm in the UK, Stagecoach Group, which employees 18,000 people there, they are one of the top 250 firms in the UK on the FTSE250. The bus lines also eliminate almost 24,000 car emissions making the company spend less on fuel cost and decrease in the release of carbon dioxide.

3) As a college student, among choices of private car, train, airplane, greyhound, and Megabus between Chicago and Columbus, which one would you choose?

As a college student traveling between these two cities I would definitely choose Megabus over all other modes of transportation, because the two cities are at a discounted fare, environmentally safer, free wi-fi for school work or movies, and outlets to power my devices. Also the fact that many other young college types ride the same bus gives a better atmosphere to travel opposed to mix crowds of children and elderly.