Ally

Bus wars hit Greyhound

Three hundred miles across the American Midwest for less than the cost of a gallon of gas: that is the deal from Megabus. The bright blue budget bus company that brought £1 fares to Britain is now operating in the US.

The company, part of the giant Stagecoach conglomerate, has set up a base in Chicago. It offers trips to and from cities as distant as Detroit for as little as $2 (£1.20) return, plus a booking fee of 50c regardless of the number of journeys booked. Other destinations include Cincinnati, Cleveland, Columbus, Indianapolis, Milwaukee, Minneapolis and St Louis.

These very low fares are available mainly for those who book well in advance for travel on less-popular services. Megabus uses the principle of "yield management": squeezing the maximum revenue from each seat. Prices rise as the bus fills up and the departure date approaches. Seats cost generally between $3 and $13 one-way, and the highest single fares are about $30. Costs are kept low because of internet-only sales and because it does not use downtown terminals.

The move is a blow to Greyhound, which has by far the widest bus network in the US with daily departures to 1,700 destinations. Fares for similar journeys in the Midwest cost between $13 and $40. "Greyhound has been associated with safe, affordable travel for more than 90 years," said a spokesman for the Dallas-based company. "The company plans to continue offering customers the convenience of choosing from several departures each day and purchasing tickets from in-station agents."

Ally

MEGATRAIN, ALSO part of the Stagecoach group, has expanded its range of destinations. The enterprise was set up to sell excess capacity on the South West Trains links from London Waterloo to Portsmouth and Southampton. It has now extended the range of services from the London terminus to include Bath (£4), Bournemouth (£1), Bristol (£4), Exeter (£1), Salisbury (£2.50), Weymouth (£1) and Yeovil (£1).

In addition, it is now selling seats on Virgin Trains. Birmingham-Bournemouth tickets are available for £1, as are seats between Edinburgh and Manchester.

All these fares were researched on 1 June for travel on 11 July. They are available only on a small number of services, and prices rise steeply close to departure. In addition, a 50p booking fee applies.