Difficulties in defining a reference value Whereas penalties are usually only applied if a parameter (such as downtime) exceeds a certain limit of acceptability, a bonus / penalty system aims at dynamic pricing which requires the definition of a reference value. For example, if bonus / penalty rules are applied to mass per seat in MU stock, an "average" value must be defined for which neither bonus nor penalty payments are realised. However, this is very difficult and will often lead to long negotiations with manufacturers, especially since the relevant quantities for energy consumption are usually governed by the laws of physics and can only be influenced to a limited extent. Separation of budgets within railways Bonus / penalty rules are essentially aimed at giving a part of LCC savings back to the manufacturer. On the part of railways, this would however require that the department benefitting from low LCC has a well-defined financial interface with the purchasing department. This is rarely the case in railway organisations. In practice, those responsible for the procurement of new stock have a certain budget, and those operating the vehicles have a separate budget. Therefore the procurement department is mostly reluctant to make bonus payments for benefits received by another department. |