Cash-strapped commuters are choosing to travel by bus and train rather than fuel their cars, according to Go-Ahead, the rail and bus operator.

The transport group said yesterday that passenger growth in its bus and rail divisions had accelerated strongly since April, attributing the change to the tough economic climate, which was making passengers think twice about using their cars.

Keith Ludeman, chief executive of Go-Ahead, said that other reasons for the shift included a growing awareness of the environment, stressful road congestion and, in big cities, the presence of Eastern European immigrants who do not own cars.

However, he believes the soaring price of petrol has convinced people to try public transport and they have been satisfied. “People tend to only look at the marginal cost of a journey, the petrol they have to put in their car. So they are keeping their cars, but being more selective about what they use them for,” Mr Ludeman said.

He added that improvements to rolling stock and punctuality have also impressed passengers and cheap off-peak fares were being taken up by many travellers, in particular the over60s.

Go-Ahead, which carries 30 per cent of the UK’s rail passengers and has the country’s fourth-biggest bus business, said pretax profits before exceptionals were £131.1 million for the year to June 28, up 19.1 per cent, on revenue up 20.4 per cent to £2.2 billion.

Go-Ahead said it had seen bus passenger growth of 2.9 per cent in the full year, with a rise of 4.9 per cent in the fourth quarter. Go-Ahead is also seeing sustained growth in passenger numbers in its rail business. Its Southern and Southeastern franchises have grown by 6.7 per cent and 6.4 per cent respectively, which has contributed to a 13.2 per cent increase in passenger revenue on Southern trains and a 13 per cent increase in Southeastern.

The rail business has grown significantly since the company took over the London Midland franchise in November 2007 and the Gatwick Express franchise in June.

However, the company will have to fight to retain its Southern and Southeastern franchises when the two are combined next year. Govia, a joint venture between Go-Ahead and the French transport group Keolis, is shortlisted for the new five-year franchise, which will be awarded next summer for an autumn 2009 start date.

Mr Ludeman said that Go-Ahead would not be immune to an economic downturn and it was keeping control of costs. Experience of the London bus sector during the downturn of the early 1990s suggested that passenger numbers remained steady, while staff turnover fell, reducing overall costs. Go-Ahead has hedged all of its fuel needs for next year and half of those for 2009, in anticipation of diesel prices staying high.

However, unlike airlines, fuel is only 10 per cent of the bus and rail group’s costs. The biggest cost, at two thirds, is labour, and the company gave warning yesterday that unions were pressing for higher wage settlements. Unions are pushing for a minimum annual salary of £30,000, compared with the average basic salary of £22,000. The RMT union said yesterday: “The £145 million profit declared by the Go-Ahead Group today is a direct drain on farepayers’ and taxpayers’ cash that should be being invested in the bus and rail industries.”

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