Simon Calder: The Man Who Pays His Way

Brewing up the profits on the planes and trains

Right now, for example, I am surrounded by flowers the colour of a Mediterranean sunrise, and suspended on a sofa plumped up with cushions as soft as the gentle breeze that wafts through this large, light chamber.

Time for tea. A waiter brings a smart Villeroy and Boch teapot and cup on a silver tray. He also supplies a dainty strainer. After a few minutes' infusion, the liquor has the rich, red glow of the African earth where the leaves were cultivated. It is the essence of the exotic. This Moroccan Mint tea takes me straight to the souks of North Africa.

Strangely, out of the window I can see India - or at least the Indian High Commission. That is because I am in the lobby of the Waldorf Hilton in central London, taking a much-needed break from my investigations into the transportational tea trade.

ON THURSDAY Stelios, the founder of easyJet, will celebrate a decade since the no-frills revolution began. Perhaps the biggest compliment to his radical approach to cutting fares is the way that the easyJet formula has been emulated across the travel industry. As I sip, I am logging on to www.megatrain.com, the website launched this week by South West Trains. The normal one-way fare from London to Southampton is £25.30. But the website offers tickets on some services for just £1 each way (plus a 50p booking fee, which covers any number of seats).

Until I visited the website, I had no intention of visiting the Solent a fortnight from now. So the train company's innovation has earned it £2.50 (£1 each way plus the booking fee) and filled a seat that would otherwise have been empty. I look forward to a morning out in Hampshire - perhaps with a cup of tea on each journey. But being tempted by the trolley on the train will cost more than the fare.

In my tireless probe into the huge profits earned by the tea barons, I discovered that South West Trains this week increased the price of a cup by 10p - three times the rate of inflation.

For £1.30 you get a plastic cup, a teabag, some warm water and a morsel of milk, and are left to get on with it. Cost of ingredients: perhaps 10p. Wages of man with thankless task of navigating trolley through crowded train: maybe the same again for each transaction. In the interests of rigorous accountancy, allow another 10p for amortisation of the infrastructure. Result: a tidy profit of £1. So I imagined, yet a spokesman for South West Trains says the company actually subsidises on-board catering. It is behind the times. Transport providers increasingly make a tidy living from so-called "ancillaries", from premium-rate PG Tips to overpriced travel insurance. South West Trains' tea is cheap compared with airlines where the high cost of hot drinks belies the low fares. Bmibaby, Monarch and Thomsonfly charge £1.50 for a cuppa, but easyJet's is £1.60 (up from £1 in a decade). You may not be amazed that Ryanair is priciest, asking £1.75 for inflight infusions. My advice: take a flask.

This kind of cross-subsidy is nothing new in travel: anyone using Britain's airports but opting not to shop is having their journey subsidised by those who cannot resist the temptation to fill that "dwell time" by spending a fortune on things they don't need. The profits from the shops keep landing charges low.

MY DWELL time at the Waldorf, whose elegant carpet was surely designed by William Morris after a trip to Andalucia, is going splendidly. The pot has yielded three cups of freshly minted Moroccan. The bill, with service, is £3.85, which works out at £1.28 a cup. This five-star hotel is undercutting South West Trains. As elevenses approaches, that's enough arithmetic - and work - for one day.

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