As mentioned this morning, at Auckland Transport’s board meeting today there is an interesting paper giving an overview of the HOP system, which AT say is the third largest financial transaction system in the country. Here are some of the figures from the paper.

  • AT have sold just over 965k HOP cards while they had only anticipated selling 338k over the same period – a case of AT underestimating demand? It certainly wouldn’t be the first time they’ve done that with a public transport initiative. They say they typically sell about 23.5k per month but that has increased to 26k per month due to the SuperGold card conversion that took place recently. I also wonder how many are due to people who have bought more than one due to cards being blacklisted.

HOP cards sold

  • AT say that as of July, 86% of trips are made using HOP and that compares favourably with systems overseas which have taken much longer to get a similar level of use. Trains still have the highest level of HOP use with 87% of trips being on HOP compared to 85% on bus (note: the graph below is to June, HOP usage has increased since then primarily due to the SuperGold card conversion.

HOP cards usage

  • AT now have 74 ticket machines at train and busway stations plus one in the Manukau Mall. There are also 73 retailers and 10 customer service centres.
  • All up the project has cost just under $100 million. That’s certainly a lot of money (and  time) but nowhere near what the two biggest cities across the ditch have paid.

HOP system costs

  • In the 2015-16 financial year (to end of June), the HOP system processed over $193 million in revenue. That was up 10% on the previous financial year and up 26% on two years prior. The charts below show where that revenue comes from (AT just stop with using pie charts will you).

HOP cards Revenue breakdown

  • There is currently $11.8 million in the HOP account, 85% of which is from stored value on cards and the remaining representing monthly passes. There is also a noticeable trend in January with the values dropping, presumably as people used up their remaining balance before going on leave over summer.

HOP account balance

  • HOP costs $16.6 million to run every year which is well above the expected $9 million from the business case. The additional costs get a 57% subsidy from the NZTA. AT give the following list of reasons for why opex is higher than expected.
  • Additional bus services which increased the cost of system support
  • Increased AT HOP Operating Staff from the original budget of nine FTEs to 37, in order to support retailers, operators, and customers
  • BT test support to provide system testing of BAU changes and system enhancements (average of 40 route changes are made each month).
  • Additional finance support – providing reconciliations, settlement support and process development (recognition that the AT HOP System is a significant financial system).
  • Increased banking fees, secure cash collection and retail commission due to the high uptake of the AT HOP Card
  • Removal of the 25 cent transaction fee for Top-up transactions

Also included in the paper is one of the worst business diagrams you’ll see, I’m still not sure what ticking and clocks have to do with it. But still a lot better than this.

HOP horrible diagram

Now that integrated fares have finally been rolled out (and done so successfully), many will be interested to know what’s next for HOP. After all payment systems are undergoing rapid change right now. Here’s what AT say about it.

The development opportunity to improve customer service offerings is being actively pursued by the AT Metro, HOP and BT teams. This may include the ability to use credit cards or phone applications for payment and the potential to extend HOP to other services such as parking. Other options include online bus updates for balances, mobile top ups, use of the ATM network and account based systems. Whilst many of these are feasible to a degree, e.g. bus updates for balances is probably only available at 10-15 minute intervals, much of this technology is new, not only to Thales but other card systems as well. Generally, development is very slow and expensive which has limited the ability for AT to progress at pace these types of initiatives. Currently AT is investigating a solution to enable the HOP card to use Near Field Communications on a smart phone and the business is working with Thales on proposals for a real time top up ability via smart phone to the physical cards.

Let’s hope we don’t have to wait years for some of these features which should almost be a minimum standard these days.

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  1. Auckland needs AT initiated BikeShare System (or work with NextBike) where we can use our HOP card to rent out a bike and return them at another station. AT should promotes this as part of the Integrated Fare where renting a bike is as easy as tagging on and off and that cost will be part of the integrated zones.The problem with this now is having many BikeShare station throughout the CBD initially. If successful then roll them out across Auckland.

    Imagine having Train – Bus – Ferry – Bike all being integrated using one single card with one simple fare system.

    Has this system ever been done before anywhere in the world? or has private companies always have BikeShare monopoly?

    1. In Lyon I was able to load an annual subscription to their Vélo’v bikeshare (an extremely cheap €25) onto my TCL transport card. Incredibly handy.

    2. I agree that AT should roll out bike share and make it accessable via HOP. Parking linked to HOP would be good too. I even heard the NZTA are keen for HOP to be linked to cars for use on toll roads which makes a lot of sense too.

    3. Wouldn’t that open the system up to (more) theft. People would just get a hop card to rent a bike, then throw out the card and keep the bike. At least a credit card provides good security.

  2. Someone in AT’s colouring in department must have done the clock picture. But you are right it is better than the ‘bicycle of education’ – that made my day.

  3. Some interesting figures here:
    1. A total project capex of almost $100M — which happens to be exactly equal to the budget: could this be too good to be true?
    2. An annual opex ( based on best current information) of $16.6M, as compared with the business case estimate of $9M. You would think that, given the wealth of experience elsewhere in implementing and operating modern ticketing systems, the business case estimate should have been more accurate.
    3. Amortising the capex over say five years and adding the opex gives a total annual cost of around $40-45M.
    4. in 2015/16, you say that the HOP system processed about $193M in revenue, say $168M excluding GST. Given the trends to date, it looks as if this figure would increase to around $200M within the next few years.
    5. This implies that the ticketing system annualised costs will be around 20-25% of the annual revenue processed.
    6. I am not sure whether this proportion should be regarded as high, low or par for the course (others may know?): as you suggest, it is probably a significantly lower proportion than is the case for the two bigger cities across the ditch..

  4. There would have been a heap of people who bought HOP cards to load the Seniors Concession. On the 3 or 4 occasions I took friends to New Lynn transport centre to get their HOP cars sorted out, the place was full. AT had to employ a whole bunch of extra people to handle the additional numbers.

  5. I also wonder how many [card sales] are due to people who have bought more than one due to cards being blacklisted.
    I think that if this figure was non-embarrassing, they would have told us by now – assuming they know it with any accuracy, I suppose they might not!

    1. I agree with you, contactless credit and debit card use should be next. When I was in London in July I registered my OneSmart Card ( multi-currency card issued by Air NZ) online at the TFL website, and used it instead of my old Oyster card spending the pounds I had loaded on the card prior to leaving New Zealand. The card worked just as well as my Oyster card, I was able to track all my trips on the website, and it took into account daily and weekly caps etc. No need to charge an Oyster card on arrival in London any more, or to purchase one!

    1. Getting hold of the float (as well as information about boarding on all buses) was the main reason NZBus wanted to force their inferior snapper system on us *for free*. Ultimately, interest earned on the float can go back into covering the costs of running the whole system, as opposed to being paid out to NZBus and privatised.

      1. Hmm – the “inferior” Snapper system already has some of the features that AT Hop aspires to, such as the ability to use mobile phones for payment and the ability to pay for parking. And, of course, it has been *for free* for Wellington ratepayers and passengers – the same farescales applies to both Snapper and non-Snapper operators, and subsidies did not change with advent of Snapper. Just sayin’…

        When (as surely will happen – see the post about Oyster above) AT Hop accepts contactless bank cards, the float and its interest-earning ability will start to disappear.

    2. To put things in perspective, say 4% interest on their deposits (just a high guess), that’s about $3 per annum on my $50 balance (max ever) – that’s a fair price to pay for running such a system. Remember, they used to charge $0.25 per top up, I’m glad that’s gone, so that’s 12 x $0.25 – worth one top up a month, it’s a fair game. No complaints from me.

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