Business & Tech

Greyhound-Peter Pan partnership comes to an end

Peter Pan has already said its ticket prices will be lower than Grey-hound’s. Above is their ticket counter at South Station, where both use the bus terminal (left).
David L. Ryan/Globe Staff
Peter Pan has already said its ticket prices will be lower than Greyhound’s. Above is the ticket counter at South Station, where both use the bus terminal.

Is New England headed for a bus fare fight?

Greyhound Lines, the nation’s largest bus carrier, and Peter Pan Bus Lines have long worked together, sharing bus operations and revenue for several major routes between cities in the Northeast.

But the partnership came undone Monday, when Peter Pan abruptly said it would no longer share routes with Greyhound as of Sept. 27.

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As they gird for head-to-head competition in an industry that has seen several low-price upstarts launched in the past 10 years, they’re each pledging low prices, with Springfield-based Peter Pan guaranteeing the lowest-priced tickets.

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Greyhound and Peter Pan, it should be noted, have gone at it before.

Their partnership had its roots in an infamous 1990s price war.

Peter Pan had recently expanded to a new terminal in Washington, D.C., and in an effort to get people aboard, it offered $10 trips between the nation’s capital and New York City.

Greyhound wasn’t having any of it and quickly trimmed its prices for the route to $7. Soon, both companies were selling tickets for as low as $5.

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Rather than undercut each other into oblivion, the companies eventually decided to join together. They won government approval to pool services in the Northeast, giving passengers the flexibility to board either company’s buses and to purchase tickets from the same locations at terminals.

Among the routes the carriers had split was Boston-New York and New York-Washington.

Prices on both lines can vary, based on date and time, but range between $17 and $36 for one-way travel between Boston and New York next week.

After nearly 20 years, that will all end next month.

“These arrangements can test the friendships of even the closest business partners,” said Joseph Schwieterman, a professor at DePaul University who studies the industry.

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Now that they are competing head-to-head, the two companies may again “feel the need to outdo their former partner with discounts,” Schwieterman said.

In separate statements, Greyhound and Peter Pan said they would offer low fares by operating independently, with Peter Pan stressing that it will refund the price difference if a competitor travels the same route at a similar time at a lower price.

Other carriers operating out of Boston include BoltBus and Lucky Star, which often offer steeply discounted fares.

Dallas-based Greyhound, meanwhile, is preparing to beef up its Northeast service. Spokeswoman Lanesha Gipson said Greyhound will bring 60 new buses to the region and launch a new route between Boston and Springfield, which happens to be Peter Pan’s home base.

Peter Pan is also adding buses and will continue to offer service on all the same routes, said chairman Peter Picknelly, who said the company is “far better off” on its own.

Peter Pan customers who took Greyhound buses could not use paperless tickets, a poor experience for customers, Picknelly said.

And Peter Pan will now be able to provide faster service between major destinations because its drivers will not need to make stops required by Greyhound.

“Not being able to operate nonstop service, not being able to have paperless boarding, not being able to focus on on-time service — all those were problems for us that we think were dragging us down,” Picknelly said.

Peter Pan and Greyhound once competed in the region, then pooled their efforts.
David L. Ryan/Globe Staff
Peter Pan and Greyhound once competed in the region, then pooled their efforts.

The breakup does not appear to be entirely amicable. The companies had been locked in a legal skirmish since 2015, when Peter Pan accused Greyhound of not properly compensating it. A recent court filing said the companies had reached an undisclosed settlement. the terms of which would be implemented by Sept. 27 — the same day the two companies are scheduled to split.

Picknelly acknowledged the split is related to that settlement and said the company saw the end of the partnership as a suitable solution.

“Gaining our independence is very important to us,” he said, noting that Greyhound has changed owners since the partnership began, with its parent company now based in the United Kingdom. “We simply can’t be part of that anymore.”

Schwieterman said the consumer advantages of such bus partnerships — such as buying tickets for either operator from the same gate — have been mostly diminished in the Internet era, because passengers often buy tickets online, sometimes from third-party aggregators that list multiple carriers’ tickets.

When Greyhound and Peter Pan begin operating independently, they will compete not just with each other but with several upstarts that didn’t exist when they first teamed up. Several low-cost bus companies have begun operating since the mid-2000s, when intercity bus travel began growing more than 5 percent annually for several years.

Meanwhile, BoltBus, a joint venture of Peter Pan and Greyhound, will be taken over by Greyhound as part of the settlement, the companies confirmed.

Adam Vaccaro can be reached at adam.vaccaro@globe.com. Follow him on Twitter at @adamtvaccaro.