Letter: Eurotunnel's forecast does not make sense
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Your support makes all the difference.Sir: You report ('Investors face pounds 800m Eurotunnel call', 17 May) that Eurotunnel predicts that by 1996 it will have captured half of the total cross-Channel car and coach passenger traffic.
This prediction is implausible. Surveys among motorists show a distinctly cool attitude to the tunnel. According to your report ('Opening of tunnel ends great divide', 7 May) on the formal opening, travel on the shuttle was a claustrophobic experience:
Most passengers yesterday agreed that given the facilities available on the ferries, with food, duty free shops, play areas and views of the White Cliffs of Dover, they would not use Le Shuttle except, perhaps, in a Force 10 Gale.
Eurotunnel's prediction must presumably be based on the route choice model on which it has always relied, which relates choice only to travel time and cost, to the exclusion of all quality considerations or psychological factors. The model, if it is indeed still the same one, is structurally incorrect even in its treatment of time and cost.
Eurotunnel's estimates of its market share are crucial to its revenue forecasts. If Eurotunnel is now attempting to raise further large sums on the Stock Exchange, it should give investors a full account of its predictive methods.
The Stock Exchange authorities must ensure that this information is provided.
Yours faithfully,
STEPHEN PLOWDEN
London, NW1
18 May
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