Thursday, September 3, 2009

How much Gautrain commuters would be prepared to pay.

The release of the salary survey by Kelly explains why the highway between Pretoria and Johannesburg becomes a garage every morning and afternoon. It also gives an indication of how much people would be willing to pay for Gautrain tickets.

Based on the salary survey, Johannesburg North based companies pay staff around 20% more than Pretoria companies do. For general office staff and administrative positions earning around R10 000 a month, that equates to an additional R2 000 a month. But recruitment firms say it is not only salary people are travelling for, but also the fact that Johannesburg attracts the more prestigious firms which look good on the CV.

When the Gautrain project was launched in 2006, a one-way ticket between Pretoria and Johannesburg was expected to be around R20. That would equate to R880 a month for a round ticket. Even if that is increased and commuters pay R1000 a month, it will be worth travelling to the city of gold for work - especially compared to driving.

It is surprising that people commute at all. At present petrol prices a commuter between the two cities would spend around R60 a day in petrol and once the toll system is fully in place will pay around R45 a day in tolls. That would cost around R2 310 a month - that is a big bite out of anyone's salary.

There are of course still costs to parking and getting from the station to work that need to be added in to the financial calculation but it is probably frustration levels that will ensure Gautrain is a success. People are now prepared to take the lower salaries to work closer to home rather than lose four hours a day to traffic jams. One recruitment agent told Moneyweb that she has seen people actually leave their jobs and risk unemployment because they could not stand another day of Ben Schoeman's hell.

If ticket prices stay within reason, it seems the success of Gautrain is a no brainer.

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