Post-pandemic

Passenger demand recovery

This is an interactive summary created by Steer to provide an overview of our analysis of the Office of Rail and Road’s Estimates of Station Usage and Origin-Destination Matrix data from the last six years. It answers questions such as:

• How has rail travel evolved since 2019?
• Which markets are thriving, and which are lagging?
• What does the 'new normal' look like for rail demand?

The Estimates of Station Usage 2024 data produced by the Office of Rail and Road (ORR) was released on 20th November.

There were 1.4bn journeys recorded in 2024.

This is a 16% increase on last year.

Steer has undertaken analysis of the Origin-Destination Matrix, from which the Estimates of Station Usage statistics are derived, to understand what has driven this growth. We've also analysed trends from the last six years to assess if we have reached a “new normal” in rail demand.

Total journeys as derived from the ORR's Estimates of Station Usage (1.4bn) are lower than the journeys published in passenger rail usage (1.6bn) as the latter takes into account the number of legs of a journey.

2024: 1.4bn journeys

2023: 1.2bn journeys

16%

How much of this growth was driven by journeys made within London?

Journeys made within the London Travelcard Area have increased by 21% in the last year.

A key driver for this growth was the opening of the Elizabeth Line, a new railway stretching more than 100km from West London to South East London, in May 2022 (RY23), with full operation from May 2023 (RY24). Passengers who have moved from using the tube to the Elizabeth Line are now included in the Estimates of Station Usage statistics.

Removing the London Travelcard Area reduces the year-on-year growth in rail demand to 12%.

Journeys in the London Travelcard Area:

Pre-Covid, growth in journeys year-on-year averaged 3%.

This year's growth of 12% is significantly higher than pre-Covid levels, but much lower than in the previous two years.

The reducing growth may hide significant variation within the markets. We will now look at each of these years in turn and how they compare to 2019.

How does growth compare to previous years?

2020

The pandemic hits in February 2020, impacting rail travel in the final few weeks of the railway year (1 April to 31 March).

2021

Great Britain cycles in and out of lockdowns and passenger journeys reduce to 23% of pre-Covid levels.

Airport travel sees the biggest drop in journeys (90%), with air travel heavily restricted, and Heathrow T4 station closed.

2022

Great Britain exits last lockdown and rail journeys start to recover.

Following the “staycation” boom and implementation of social distancing measures, recovery in long-distance journeys is strongest.

There is limited recovery in international travel - so rail travel to airports remains suppressed, Heathrow T4 remains closed.

The impact of hybrid working policies stifles recovery in the South East to London market.

2023

Rail demand continues to recover but industrial action begins during the year, impacting all markets.

As international travel opens up, rail travel to/from airports recovers from 35% to 75%.

2024

Rail strikes continue in 2024, but growth rates begin to stabilise across all segments.

Non-London short distance and South East to London trips remain below 80% of 2019 levels.

Timeline of rail market recovery

Rail demand between 2019 and 2024

Airport

Long Distance

South East

South East to/from London

Non-London short distance trips

2020

2021

2022

2023

2024

A closer look at growth rates by flow (which measures how passenger numbers vary between origin and destination stations) gives a clearer understanding of whether passenger demand has stabilised at a different level compared to pre-Covid patterns.

Pre-pandemic, the year-on-year growth was quite uniform across all flows. The distribution is narrow, with most flows around the average rate.

For the following three years, flows have recovered at very different rates, driven by different market responses to the pandemic.

The distribution is wide: some flows had very high growth while some had very low growth.

Finally, in 2024, we are starting to see a more normal distribution of growth, with most flows close to the average. The data looks very similar to 2020 - have we reached a "new normal"?

Distribution of growth

Year-on-year growth distribution

2020

2021

2022

2023

2024

While growth might be starting to stabilise, the market looks different to pre-Covid levels.

Long distance journeys are at 92% of 2019 levels, but South East to/from London journeys are at 79%.

Recent passenger research undertaken by Steer highlights that:

While nearly 80% of individuals aged over 45 have consistently used rail services across 2023 and 2024, only 1 in 3 individuals aged 18-24 report the same.

And while those in the younger age group are significantly more likely to have started using rail, they are also more likely to have stopped using rail in the last year.

The evidence suggests we have reached a "new normal" for rail demand and targeted action is now required to grow markets further.

Attracting, and then retaining, younger rail passengers represents a real opportunity, but will require tailored strategies to secure and sustain their loyalty.

2024 vs pre-Covid journey recovery by segment

For more information, contact:

Mark Brownie, Associate

Mark.Brownie@steergroup.com

Adam Stevens, Principal Consultant

Adam.Stevens@steergroup.com