Simon Calder: Is Varsity a match for the UK's railways?

The man who pays his way

Last Saturday's headlines could not have been better timed to help a young entrepreneur about to launch Britain's latest domestic flight. "Upgraded InterCity train plan put on hold until after the election," The Independent reported. Yet another government has bottled a decision on replacing decades-old high-speed trains with more efficient rolling stock that would have lured travellers from the roads or air lanes. The climbdown offers plenty of scope for start-up airlines who want to capitalise on the shaky state of the UK's railways.

By daybreak on Monday morning, Martin Halstead, managing director of Varsity Express (flyvarsity.com), was standing beside a Jetstream aircraft at Oxford's diminutive airport. As the mist rose from the meadows, and the breath of grumpy journalists froze, he cracked open a bottle of champagne to launch the first scheduled flight from Oxford airport to Edinburgh.

"Our forward bookings have proven that there's a big need for this new link," he told me. "Oxford is a developing airport that has been looking for this service for some time. Timings are right now and facilities are in place."

The weekday-only service is aimed beyond the academic community. It takes a mere 90 minutes, so "the business traveller to Edinburgh can avoid an overnight and be home for supper with his/her family". In comparison, the train takes about six hours to bridge the gap between the Isis and the Forth.

Given the airline's publicity about the dismal terrestrial alternatives, you might imagine an air link connecting the brainiest cities in England and Scotland could hardly fail.

While the flight costs £49 one way, on the rails "the cheapest standard one-way fare booked a month in advance from Oxford to Edinburgh is £107.50". So, for less than half what is said to be the lowest train fare, you get to travel in a comfortable 18-seat aircraft, with, says Mr Halstead, "complimentary food and drink on board". You don't get that on Cross Country Trains, nor while thumbing beside the exit lane from Hilton Park Services on the M6 – one of the more miserable places at which Anglo-Scottish hitch-hikers, appalled at the high cost of rail travel, could end up.

Travellers have learned from painful experience over the past decade that booking ahead is supposed to bring bargains, rather than a fare of £107.50 for a journey of around 350 miles. In fact, this fare quoted is the "walk-up" single that you could buy up to one minute before departure (followed by a breathless sprint across the bridge at Oxford station). Break the journey into the component parts, via Birmingham New Street, and the fare falls to £41 (or, if you have the fortune to qualify for a railcard, one-third less). And while Varsity Express promises "no hidden fees – what you see is what you pay", in fact a £4.95 "card handling fee" raises the air fare by 10 per cent.

The only other scheduled service from the airport known, optimistically, as "London Oxford" is a weekly hop to Geneva. So you need not be a genius to work out that the Varsity Express link brings to a total of one the UK routes available from Oxford. But the brains behind the air routes website, anna.aero, have calculated that it increases Edinburgh's domestic flights to 25 – earning it joint top place in the league table alongside Glasgow. Belfast City, Aberdeen and Jersey complete the top five.

So what about Europe's busiest airport, Heathrow? Such is the pressure on slots at London's main airport that it does not even make the top 12, languishing with a meagre seven domestic destinations. With opposition mounting to a third runway, perhaps the overspill will be taken up by Oxford.

Second wind for air entrepreneur

By the age of 23, Martin Halstead is already on his second airline. The first, Alpha One Airways, was intended to connect Oxford and Cambridge. That route never got off the ground – though the bus alternative, the X5, is a comfortable option with Wi-Fi all the way across the Oxbridge divide.

Alpha One Airways flew briefly between Edinburgh and the Isle of Man, carrying around 300 passengers before closing down four years ago – the fate of many startup domestic airlines. So what will make his latest venture, Varsity Express, any different?

“We have enough money in place to run for a long time without making a profit,” he told me. But when does he expect the airline to start making money? “Within six months”. One costsaving advantage that few other airline bosses can boast is the ability to take to the controls: Mr Halstead is a qualified commercial pilot and flew the Oxford-Edinburgh hop on Thursday.