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Bus Services

Reducing Costs, Raising Standards

Alan Armstrong-Wright

and Sebastien Thiriez

RECENT WORLD BANK TECHNICAL PAPERS No. 20. Water Quality in HydroelectricProjects: Considerationsfor Planning in Tropical Forest Regions No. 21. Industrial Restructuring: Issues and Experiences in Selected Developed Economies No. 22. Energy Efficiency in the Steel Industry with Emphasis on Developing Countries No. 23. The Twinning of Institutions: Its Use as a Technical Assistance Delivery System No. 24. World Sulphur Survey in Sub-SaharanAfrica: Strategies and Performance No. 25. Industrialization (also in French, 25F) No. 26. Small Enterprise Development: Economic Issues from African Experience (also in French, 26F) No. 27. Farming Systems in Africa: The Great Lakes Highlands of Zaire, Rwanda, and Burundi (also in French, 27F) No. 28. Technical Assistance and Aid Agency Staff: Alternative Techniques for Greater Effectiveness No. 29. Handpumps Testing and Development: Progress Report on Field and Laboratory Testing Review and Annotated Bibliography No. 30. Recycling from Municipal Refuse: A State-of-the-Art No. 31. Remanufacturing: The Experience of the United States and Implicationsfor DevelopingCountries No. 32. World Refinery Industry: Reed for Restructuring No. 33. Guidelines for Calculating Financial and Economic Rates of Return for DFC Projects (also in French, 33F, and Spanish, 33s) No. 34. Energy Efficiency in the Pulp and Paper Industry with Emphasis on Developing Coun&ies No. 35. Potential for Energy Efficiency in the Fertilizer Industry No. 36. Aquaculture: A Component of Low Cost Sanitation TechnoloB No. 37. Municipal Waste Processing in Europe: A Status Report on Selected Materials and Energy Recovery Projects No. 38. Bulk Shipping and Terminal Logistics No. 39. Cocoa Production: Present Constraints and Priorities for Research No. 40. IrrigationDesign and Management: Experience in Thailand No. 41. Fuel Peat In Developing Countries No. 42. Administrativeand Operational Procedures for Programs for Sites and Services and Area Upgrading No. 43. Farming Systems Research: A Review No. 44. Animal Health Services in Sub-SaharanAfrica: Alternative Approaches No. 45. The InternationalRoad Roughness Experiment: Establishing Correlation and and a Calibration Standard for Measurements No. 46. Guidelines for Conducting and Calibrating Road Roughness Measurements No. 47. Guidelines for Evaluating the Management Information Systems of Industrial Enterprises No. 40. Handpumps Testing and Development: Proceedings of a Workshop in China No. 49. Anaerobic Digestion: Principals and Practices for Biogas Systems No. 50. Investmentand Finance in Agricultural Service Cooperatives (List continues on the inside back cover.)

Bus Services
Reducing Costs, Raising Standards

URBANTBANSPCBTSERIES

This series is produced by the Water Supply and Urban Development Department to provide guidance on a number of technical The series supports the sector issues in the urban transport field. policy paper Urban Transport and is designed to assist city and central government officials. as well as World Bank staff and consultants, concerned with urban transport in developing countries. Volumes already published include:

Institutional Building for Traffic Management (World Bank Technical Paper Number 8) Urban Transit Systems: Guidelines for Examining -(World Bank Technical Paper Number 52) A complementary in Developing Countries Options

paper is Toward Better Urban Transport Planning (World Bank Staff Working Paper Number 600).

Volume in preparation: Traffic Hanagement Appraisal Projects: Identification, Preparation, and

It is expected Urban Transport Series need arises.

that further guidelines will to cover other urban transport

be added to the issues when the

WORLDBANK

TECHNICAL

PAPER NUMBER SERIES

68

URBAN TRANSPORT

Bus Services
Reducing Costs, Raising Standards

Alan Armstrong-Wright

and Sebastien Thiriez


s*

The World Bank Washington, D.C.

The International Bank for Reconstruction and Development/THE WORLDBANK 1818 H Street, N.W. Washington, D.C. 20433, U.S.A. All rights reserved Manufactured in the United States of America First printing July 1987 Technical Papers are not formal publications of the World Bank, and are circulated to encourage discussion and comment and to communicate the results of the Bank s work quickly to the development community; citation and the use of these papers should take account of their provisional character. The findings, interpretations, and conclusions expressed in this paper are entirely those of the author(s) and should not be attributed in any manner to the World Bank, to its affiliated organizations, or to members of its Board of Executive Directors or the countries they represent. Any maps that accompany the text have been prepared solely for the convenience of readers; the designations and presentation of material in them do not imply the expression of any opinion whatsoever on the part of the World Bank, its affiliates, or its Board or member countries concerning the legal status of any country, territory, city, or area or of the authorities thereof or concerning the delimitation of its boundaries or its national affiliation. Because of the informality and to present the results of research with the least possible delay, the typescript has not been prepared in accordance with the procedures appropriate to formal printed texts, and the World Bank accepts no responsibility for errors. The publication is supplied at a token charge to defray part of the cost of manufacture and distribution. The most recent World Bank publications are described in the catalog New Publicafions, a new edition of which is issued in the spring and fall of each year. The complete backlist of publications is shown in the annual Index of Publicafions, which contains an alphabetical title list and indexes of subjects, authors, and countries and regions; it is of value principally to libraries and institutional purchasers. The latest edition of each of these is available free of charge from the Publications Sales Unit, Department F, The World Bank, 1818 H Street, N.W., Washington, D.C. 20433, U.S.A., or from Publications, The World Bank, 66, avenue d I&a, 75116 Paris, France. Alan Armstrong-Wright is the urban transport adviser in the World Bank, and France. Sebastien Thiriez is a civil engineer in the Ministryof Transport,
Library of Congress Armstrong-Wright, Cataloging-in-Publication Alan, 1929raising standards paper, ISSN f Alan Armstrong Data

Bus services : reducing costs, -Wright and Sebastien Thiriez. p. 68) (Urban cm. -- (World Bank transport series) p.

technical

0253-7494

; no.

Bibliography:

ISBN o-8213-0943-9 1. Bus lines--Developing -Developing II. Title. HE5725.A76 countries. III. 1987 Series.

countries. I. Thiriez, IV. Series:

2. Transportation Sebastien, 1958Urban transport

and

state-

.
series. 87-17183 CIP

388.4'1322'09172--dc19

- vii -

TABLE OF CONTENTS

Foreword Acknowledgments

ix
X

Chapter 1

INTRODUCTION Purpose of this Volume Summary OWNERSHIP Cost of Services Quality of Services and Safety Public Bus Corporations: Improving Viability Bus Companies in Mixed Ownership Size of Undertakings VARIETY OF VEHICLES AND SERVICES Size and Demand Size, Type, and Maintenance Freedom of Choice Variety of Services Drawbacks of Standardization COOPERATION BETWEEN OPERATORS Function of Route Associations Competition Disadvantages of Cooperation THE ROLE OF GOVERNMENT IN PUBLIC TRANSPORT Regulation Responsibilities of Government PERFORMANCE EVALUATION AND STANDARDS OF SERVICE Key Operational Performance Indicators Quality of Service Indicators

1 2 6 6 11 14 18 20 22 22 25 26 27 30 32 32 34 34 37 37 42

Chapter 2

Chapter 3

Chapter 4

Chapter 5

Chapter 6

48 49 53

Annex I

BUS SERVICES: EVALUATION AND IMPROVEMENT STUDY Draft Terms of Reference BUS SERVICES: GOVERNMENT POLICY AND ACTION STUDY Draft Terms of Reference
BUS SERVICES: DATA SUMMARY

57

Annex II

69

Annex III Annex IV

79

BRIEF CASE STUDIES OF BUS SERVICES

81

- viii

Bibliography

97

TABLES 1 2 3 4

Comparison of Costs Deficits Public Bus Corporations: Capital Cost of buses (1986) and Route Associations Bus Unions, Cooperatives

7 14 25 35

BOXES 1 2 3 4 5 6 7 8 9 10 11 12

Revenue Collection Private and Public Bus Operators Unprofitable Bus Routes Successful Public Bus Corporations Mixed Ownership Bus Companies Large Undertakings Size of Buses and Level of Demand Variety of Services Route Associations Minimal Regulations Problems of Regulated Fares Government Facilities to Assist Bus Operations

10 12 15 17 19 21 24 29 33 39 40 46

'V'

ABSTRACT

Certain conditions are generally present when bus services are financially viable and of a reasonable standard. This conclusion is based on the examination of a large number and a wide variety of bus services throughout the developing world. Important aspects to consider include ownership of bus services and the variety of vehicles and services, as well as cooperation and Governments competition and their impact on viability and standards. can play a role in improving bus services, and various degrees of regulation and freedom are needed to enhance the opportunities for viable bus services. A set of basic indicators can be used to measure and monitor the performance and quality of bus services so that deficiencies and opportunities for improvements can be readily identified. Draft terms of reference for bus service studies, a summary of data on bus services, and brief case studies on the urban transport situation in several developing countries add to the understanding of the issues.

ix -

FOREWORD
Most cities in developing countries rely heavily on the use of as the major means of mobility, particularly for the urban poor. Even in cities with extensive rail networks, the majority of trips are An estimated 600 million trips a day were made on buses or minibuses. being made in buses in the developing cities in 1980; by 2000 that it is figure will have at least doubled -- with so many people affected, not surprising to find the quantity and quality of bus services as a worldwide topic of considerable concern. buses This technical paper recognizes the pressing need in most developing cities to improve both the supply and standard of bus suggests way in which these of experience, services and, in the light improvements might be achieved. Bearing in mind the considerable differences that exist between developing countries and even between cities in the same country, it is unlikely that all the favorable conditions for viable bus services described in this paper can be applied universally. However, there is little doubt that each step made in the direction suggested is likely to result in progressive improvements both to viability and standards of service. In addition to providing guidance for improving viability and the paper includes a set of performance indicators which standards, should enable both city authorities and bus operators to monitor the performance of their services and to detect unsatisfactory trends and to identify areas that require attention. In view of the range of urban problems facing the developing Bus Services: Reducing Costs, Raising Standards is but one of countries, the Urban Transport series being prepared by this department to provide guidance on a number of technical issues in the urban transport sector.

Water Supply

Rene Costa Acting Director & Urban Development

Department

-x-

ACKNOWLEDCEMENTS
The authors assistance wish to acknowledge in the preparation their this appreciation of the paper provided by: Transport and and in developing

valuable

of

David Maunder Road Research comprehensive countries;

and Philip Fouracre of the Laboratory for their advice material on public transport

Rex Faulks of London Transport International, of London Buses Limited, and Richard Darbera Paris University for their valuable comments paper i Alan Gray and Christopher Metz Services Limited for background performance measures; Members of the their continued many developing Alison Raphael, abbreviated the

Marcus Smith of L OEIL, on the draft

of Transport Management material and advice on

Urban Transport Group of the World Bank for support and advice on bus services in the countries in which they have worked; and who edited the case studies. text and substantially

transport information

the authors wish to express their thanks Finally, operators around the world who provided a wealth on their bus services.

to of

the

many

CHAPTER 1

INTRODUCTION

Why are losses? Why are

some bus services service standards of service? a large

financially high

viable

while

others

accrue

huge What

in some cases

and low in others? to answer of these

are acceptable the World throughout set out

standards

In an attempt

questions,

Bank has examined the developing

number and wide variety The purpose of this

bus services paper is to

world. found

technical in viable

the circumstances costs

to be likely standards.

to result

bus services

and Lead to reduced

and raised

Purpose

of

this

Volume

The paper operators, of their interested

should

assist

city the city

authorities, financial authorities, and provisions viable the

and both

public

and private performances

in improving To assist

and operational the paper

bus services. and Local are

describes apply

the where

central

government found

policies

that

usually

bus services

to be financially sets out

and of

acceptable

standards.

For bus operators, costs, generally increased result

the paper revenue, in Losses

practices

that

Lead to reduced that

and better and poor

services. services also

The circumstances are described.

In addition, can be used be achieved quality evaluation aid agencies that to evaluate

the paper

sets

out

the key performance ranges of

indicators values of that

that could

bus services well-run

and suggests bus services. expect also

by reasonably the public

The standards are discussed. to

service Such an

can reasonably not only

should that for

be useful seek

to operators, of

but also

investors

or being

to assess assistance.

the performance

a bus undertaking

considered

financial

In the present transport services and strictly is vitally

climate limited

of

very

rapid

growth

in the demand for of viable

public

resources, to

the availability of cities

bus being

important

the efficiency

and the well

-2-

of

their

citizens.

In most developing and often the only means of in order

countries,

buses

are

the major poor. with

mode of They can

urban provide

transport a very

one affordable moving

to the urban of people

efficient

Large numbers

considerable

flexibility,

to meet demand throughout

the city.

Yet despite of demand; systems

their are

vital

role,

bus services

in many places

fall

short and and

frequently this which is

severely because

overstretched, are restrained costs

uncomfortable, by regulations As a

unreliable. inefficient result,

Very often practices, heavy subsidies

they

in turn

Lead to high required.

and losses.

are usually

Although service inhibit because subsidies of demand. at certain investment

subsidies fares,

may be introduced experience

to maintain subsidies

a desirable are inclined

level to is

of

shows that resulting faster

and expansion, increases

in reduced than budget

standards. revenues, services are

This so that fall fully

demand inevitably cannot

go on expanding. of

As a result, subsidies for

subsidized public

short
.

(The implications in Urban Transport:

transport

discussed

A World Bank Policy

Study).

On the other of bus services over that

hand, are such self

there

are numerous

examples they for

throughout

the world of and

supporting. attract better

Because investment able

show a surplus improvement growing

revenue expansion. both

costs,

services they are

As a result and quantity drain on city

to cope

with

demands for an ever-

quality

than

subsidized

services

that

represent

increasing

budgets.

Summary 1

Bus services variety of methods of

in developing ownership

countries

are

characterized of control,

by a wide regulations,

and operation,

levels

Lf

in this summary are described in the Examples noted in parentheses in the Annex. boxes in the main text and in the case studies

-3-

and competition.. viability generally

An examination

of

these of

factors

reveals certain

that

for

financial are

and a reasonable present in varying

standard degrees.

service,

conditions

Much of form of viability services Calcutta, Lesser needs ownership of are

the

information of

gathered competition 2).


.

on bus services are major

suggests

that

the

and degree

factors

in the

financial

bus services found to cost etc.)

(Chapter

Generally,
.

privately

owned bus (Ankara, and to a to customers

much Less than publicly Under competition, tend private

owned services operators,

Jakarta, extent public

operators,

to become more responsive ways to cut competitors, standards) costs. erosion seldom are

and more innovative of competition

in finding (unfair

The alleged of viability, to be real with a minimum

disadvantages congestion problems of

at bus stops, when they arise,

Low safety

found

such problems of

can usually routes, is,

be overcome often cited

intervention. of

The neglect relying

unprofitable operators, avoided

as a

disadvantage problem

on private

in practice, (Istanbul, generally commercial set

a much smaller Kingston, difficult

than expected etc.) there

and can be easily Although are public

Bangkok, find Lines it

Buenos Aires, to be viable, to be financially (Bombay,

corporations along are

some that supporting

operate

and are able levels

self

when fares

at reasonable

Madras,

Coimbatore).

Experience undertakings, cost of effective the form of


.

with

the

size

of

bus undertakings

indicates are

that very

small much more

particularly than Large

those

operated

by owner-drivers, this may also of

operations. There is

However, little of

be a reflection of scale from into

ownership.

evidence

economies small

Large Large

bus undertakings, corporations Losses has, (Buenos

and the merging instead, Aires, resulted Bangkok,

a number of in diseconomies

bus services

and substantial

financial

Colombo).

The choice Level vehicles space of service are

of

vehicles

for

bus services

has a direct

bearing 3,

on the small road

and cost

effectiveness. economical

As described than larger however, ones

in Chapter in their vehicles

generally

Less

use of

and energy.

In developing

countries,

small

can often

-4-

be cost vehicle financially

effective permit

because requirements. while Nairobi,

of

low labor

costs

and less areas, service, buses

stringent small vehicles

driving

and

In low-density frequent Large

can remain of

viable

providing Istanbul). high

despite are generally

low levels

demand (Jakarta, on routes utilization. most likely where services

most suitable and full buses is

where demand is In most cities to provide are free for cost

enough

to sustain of large,

frequent

service

a mixture effective

medium, and small such a mixture to use. are Also, given

services; which vehicle

usually better

occurs

operators

to choose the public

are provided

when passengers frequency, to pay for high

the opportunity Experience As incomes thereby the who

to make choices indicates rise, that

in comfort, many people services

reliability, are willing

and price. better of services.

improved

can help

to retain

Levels cars*

patronage, At the

avoiding public

a swing transport

from public system needs

transport to include for

to private low-cost

same time, for those The these

bus services and lower of

are willing p.rovision extremes of

to sacrifice systems that

comfort cater

reliability levels of

fares.

to various

demand between and result

two

is most likely for

to meet the needs viability

the public

in greater

opportunities

financial

(Hong Kong).

Bus services associations levels ails is of

that

are

self

regulated

by cooperatives are 4) found

and route to provide free-forcompetition

made up of service

private to

operators the public. avoided, these

generally (Chapter

beneficial practices

Disruptive element are of

and cut-throat retained. Despite

are

but a strong generally

low fares, to growing

systems

financially Bogota, and

viable etc.).

and respond However,

well

demand (Daejeon, such as price

Montevideo, fixing,

unhealthy

practices,

may arise,

government

authorities

may need

to take

countermeasures.

The role provision experience efficiently operators forces of

of

public

authorities, bus services it is clear is

both

national

and local, 5.

in the From

satisfactory

examined that

in Chapter

around with have

the world, a minimum of

bus services

work most where to marke of

government flexibility

control. to set

In particular, fares of in response buses, the

some measure routes,

of

and determine

frequencies,

and size

chances

-5-

financial But undue

viability regulation Delhi, creating while

and of Lagos).

public fares

satisfaction is likely to

are result

greatly in

enhanced inadequate are able to can fares. to bus for

(Colombo). services play be a vital

(Medellin, role viable in

Nevertheless, within

governments which bus at

an environment satisfactory can bus

operations acceptable

financially In

providing governments

services valuable

particular, improving and

provide

assistance priority safety

operators bus

by

and

paving traffic

routes

providing and road

measures and

services standards

enforcing Alegre,

regulations Abidjan).

environmental

(Port0

Bangkok,

Most lack used costly bus of to

developing Thus advantage, For are this

cities it is if

face vital the

very that public

heavy

demand

for

bus

services available poor and or

and

a are

resources. the best

whatever is not to

resources suffer

are from

services. services

reason so Chapter

it that

is

important deficiencies

to

know how well-can be readily

badly-

performing,

identified

and

improvements and

effected. quality and as

6 describes that can be

a set used in

of the in

operational initial order to evaluation detect and

performance of bus

standards a system for

services adverse

regular

monitoring

correct

trends.

Included for bus a bus services of of World that services

in

Annex

I are and

draft

terms

of

reference and, In order services world, III. Brief

to in

provide Annex II,

guidance for an in a a

evaluation policy

improvement action

study

government the

and

study. of bus

to

provide

indication variety by the services are

comparative

performance the in

achieved the case data

circumstances Bank have illustrate in Annex

throughout been the IV. tabulated conditions

developing Annex that

collected of bus

studies and

influence

viability

standards

contained

-6-

CHAPTER2

OWNERSHIP

Privately cost very

owned bus less

services, than publicly (Table provide

with

very

few exceptions,

are

found

to

considerably of being

owned services 1: Comparison generally is of

and hence Costs) if

have a much of

greater service

chance that

viable.

The quality not better,

private

operators

as good, both cost

than their quality of

public services

counterparts. are enhanced.

With competition,

effectiveness

and

Both the operational corporations measure of can be improved independence.

and financial if they operate

performance

of

public lines

bus with a

on commercial

Cost

of

Services

An examination countries kilometer) services. under reveals for that

of

a large

number of the cost is

bus services of half

in developing (passengerof publicly owned

generally

per unit roughly are

output that

privately

owned services and public difference

Even when private conditions, this

buses

operating prevails.

in the

same city

similar

in cost

There more cost

are

several

reasons

why private

bus operations

are

generally

effective

than public

corporations.

Staffing publicly

Levels. is

One of that

the primary are

reasons

for

the high

cost It is per

of not

owned services public in excess

they

frequently with staffing

overstaffed. ratios (staff

uncommon to find operating higher. five family bus)

bus corporations of

eight , and very private operations in the

often

between staffing

10 and 15 or even ratios of about

On the other

hand,

have of

or even

as low as two or three

case

owner-drivers

or small

enterprises.

-7-

Table (Private and Public

1:

Comparison operating

of

Costs

Bus Services

in the same city:

1985 Data) cost Pass/ Km USC

City Accra

Ownership Public Private Public Private Public Private Private Public Private Private Public Private Private Public Private Private Public Private Private Public Public/ Military Private Public Private Public Private

Type of Buses Large SD Regular SD Large SD Large SD Large SD Large SD Mini Large SD,DD Large SD Small SD Large SD,Art Large SD Mini Large SD,DD Large SD Mini Large SD Regular SD Mini Large Large SD SD

Fleet 44 665
900

Fleet Utilization 24 73 65 95 80 80 64 86 88 60 78
59

Staff/ Bus Ratio 28.2 5.5 6.0 2.6 6.2

Fare for 5 Km US$ 0.13(C) 0.18(C) 0.12(F) 0.12(F) 0.07(F) 0.07(F) 0.07(F) 0.04(C) 0.04(C) 0.08(G) 0.14(F) 0.14(F) 0.20(G) 0.13(F) 0:13(F) 0.13(F) 0.04(F) 0.04(F) 0.06(F) 0.08(G) 0.08(G) 0.06(G) 0.01(F) 0.09(F) 0.26(F) 0.26(F)

Revenue cost Ratio 0.51 1.40

Ankara Bangkok

200 4,400 550 12,000 1,100 2,200 950 1,500 960 3,800 1,940 550 3,365
790

2.5 1.2 1.9 1.2 1.9 0.7 1.0 2.0 1.7 2.2 1.8 0.9 1.2 2.8 1.0 1.3 1.5 0.7 0.6 1.6

0.67 1.70 0.74 1.10 1.20 0.46 1.10 1.35 0.88 1.10 1.40 0.50 1.20 1.45 0.49 1.15 1.30 0.80 1.00 1.10 0.12

Calcutta

20.7 4.0 3.8 7.5

Istanbul

Jakarta

76 80 40 72 80 65 78 80 87 82 90

14.5 7.25 5.5 12.4 6.4 5.7 18.1 8.0 4.5 5.7 7.6 5.1

Karachi

1,320 3,980 74 141 720 6,500 -_ 3,280 5,850

Khartoum

Converted t tucks Large SD Large SD Large Large SD/Art SD

Mexico

City

Sao Paul0

Staff /Bus Ratio is in respect SD = Single Deck Buses DD = Double Deck Buses Buses Art = .Articulated Source: World Bank surveys

of operating

buses
Fares (ie., related to distance)

F = Flat Fare G = Graduated

and studies.

-8-

The high redundant regulations losses, increase. staff

staffing

ratios off

of

public

corporations due either of

often

arise

because

cannot

be layed influence.

or retired,

to government considerable ratios of thus

or union

This

can be a cause are often reduced

very

particularly Also,

when bus services public corporations

and staffing layers

have excessive employing large

management and and may

and use elaborate accounting impair staffs.

administrative

procedures

clerical

Such arrangements productivity.

add considerably

to overhead

rather

than enhance,

Rates rates private higher of

of

Pay.

Employees

of

public benefits staff because

corporations than their of private

generally counterparts

earn in

higher

pay and receive enterprises.

more fringe where

In cases pay, it is

enterprises hours,

receive are more

take-home

usually

they

work longer

productive,

and may share

in the profits.

Private stringent public available enterprises.

enterprises for

tend driving

to choose permits drivers

small than of

buses

that buses--

involve

less of

requirements corporations.

larger

the choice

As a result, less,

small

buses

are more readily of private

and can be paid

thus

improving

the viability

Productivity. the extent characteristic keep their to which of vehicles

Of considerable buses are

influence

on the use.

level

of

viability

is

put to productive is

A particular are highly motivated are dealt to with

private fully

bus enterprises operational. undertaken

that

they

Repairs overnight on the operators

and maintenance or during spot. achieve Driver

expeditiously, minor any, repairs

usually one of

being

off-peak

periods; if

ten made by drivers private it is not

absenteeism, level 80-90 of

is minimal. of

As a result, their buses:

a high at least

utilization of private

uncommon to find peak periods. public of their

percent hand, are

bus fleets

in operation

during

On the other bus corporations


bus

with rarely

a few notable able

exceptions

(mainly

in India) percent public of

to outshed In addition,

more than 60-70 the number of

fleets during

in peak the day is

periods. often

buses rate

in service of

substantially

reduced

because

a high

breakdowns.

-9-

When compared.to in service absenteeism, are out of


.

private

buses,

the

Lower proportion a high

of

public

buses

can be attributed poor service maintenance, represent

to a Lack of

incentives, of4spares.

LeveL of buses that of is

and a shortage a substantial staffing

Clearly,

Loss o.f earnings ratios, staff

and a waste productivity enterprises. per day, is

capital naturally Measured

resources.

With much higher

much Lower in public in terms of for

corporations

than in private per staff member,

passenger-kilometers public at

staff half

productivity that of

the average enterprises,

corporation,

at 500-600,

roughly

private

l,lOO-1,300.

Revenue revenue seriously more

Losses.

Many public

corporations in the fare

are

plagued

by a loss system,

of adding

due to faults to their

or irregularities losses. routing, termed Apart

collection

other

from the

lost

opportunities of service,

to collect direct

revenue

by better often

scheduling, revenue

and standards arise

revenue

Losses--

Leakages--

because:

passengers collector, to pay; bus crews because crowded fare it

evade travel

payment of

fares; of

e.g., buses,

they

avoid

the refuse

on the outside

or simply

are is

tardy arduous Also,

in the collection or difficult, they may not

of

fares,

either case of large

as in the be prepared

buses.

to tackle

evaders;

the

penalties

are

insufficient

to deter

evasion;

fares

collected

are

stolen

by bus crews

or other

staff.

The issuing turnstyles, (Box designed

of

tickets

or tokens these

and the use of have is

secure of

fare

boxes

and

to overcome

Losses, there

a measure

success. passengers,

1: Revenue

Collection).

But where even

collusion are

between far

collectors, completely avoid

and inspectors, secure. these

sophisticated with

systems automatic

from being collection cost, and may

The use of problems, delays

turnstyles but the

fare its

some of

technology

involved,

passenger countries.

boarding

may be serious

disadvantages

in many developing

10 -

BOX 1:

Revenue

Collection

utilize private buses In Brazil many public and turnstyles with built-in counters. The turnstyles are operated by who is able to block the entry of passengers into the collector, they have paid their fares. To the main body of the bus until the rear entry platform is large enough to reduce boarding delays, the accommodate about twenty passengers waiting to go through This enables the buses to move off while fares are turnstyle. Since the number of passengers going still being collected. and it is very difficult to through the turnstyles is recorded, fare evasion and revenue leakage are climb over the turnstyles, Passengers permitted to travel free of charge (company reduced. staff and policemen) enter through the front door, controlled by which provides an opportunity for abuse. the driver, system to reduce revenue losses has been A novel In this system bus tickets are also introduced in Lima, Peru. Raffles are held monthly and winners receive raffle tickets. Passengers now insist on being given tickets, handsome prizes. which they carefully retain. Apart from an increase in the number of passengers paying the correct fare, the records of fare collection have become more reliable and the opportunities for fraud have been reduced. Crews selling winning tickets also which provides them with the incentive to receive a prize, cooperate with the scheme. Since the system has been introduced, in revenue, which more than there has been a very sharp increase covers the comparatively small outlay on the raffles.

Revenue particularly private hire out

leakage

is much less of

of

a problem or small

in the private family

sector, Other they may

in the case avoid buses the for

owner-drivers

businesses.

owners their

problem fixed day.

in a number of

ways.

For example, their crews retain

amounts or may require In either case,

to hand in a any surplus

predetermined revenue adjusted between return. sector,

amount each

the crews

as their to reflect routes, While

renumeration. increased both of

The amount due to costs, improved

the owner

can be readily and variations

overall

revenue,

so that this type

the owners arrangement arise lacks

and crews works

obtain

a reasonable well in the private In particular, and there may be

reasonably

a number of sector

difficulties

in the public

sector.

the public considerable crews.

generally to

the necessary of cases, union

flexibility

resistance of this, loss,

the adjustment

the basic

amount due from bus have are been running

Because

in a number of while crews with

corporations protection

at a considerable excessive rewards.

receiving

11 -

Revenue estimated

leakage

of

LO-15 percent

is

not

uncommon;

leakage

has been

to be as high small

as 30 percent revenue a Loss.

in some cases. Leakage can spell

But even at the difference between

comparatively making a profit

Levels,

and incurring

The comparative are well illustrated

viability

of

private

and publicly and Public

owned bus services Bus Operators).

in Calcutta

(Box 2:

Private

Quality

of

Services

and Safety

While under private

there

may be overwhelming invariably this is with are

evidence self

to show that

bus services there and private unfair is

ownership concern

supporting, at the expense

sometimes of

considerable safety. operators competition. Also, are

that

achieved public

quality that

in comparison inclined

operators,

it

is

said

to cause

undue traffic

congestion

and provide

These sometimes appear services In fact, (Calcutta, generally charging provide are is able little
.

impressions

arise of

mainly private

because

of

the highly But even

motivated though

and may

aggressive

behavior g iven efficient

operators.

they

chaotic that

at times, are very

the opportunity, and responsive comparing

private

operators of

provide the public.

to the needs in the of

from a number of Istanbul,

studies

services

same cities bus services ownership operators fares Also they there

Bangkok, if

Jakarta), not better,

the quality than those cities,

private public

seems as good, similar a higher fares. standard

under

In a Large of service,

number of as is their

private

evident public

from the higher counterparts. that privately

to command in comparison concrete are Less evidence safe than to

with

support that

the concern are publicly

owned bus

services

those

owned.

12

BOX 2:

Private

and Public

Bus Operators to make a direct owned bus services

Calcutta provides one opportunity comparison between privately owned and publicly operating under similar conditions.

Public buses are operated by the Calcutta State Transport The fleet of some 1,100 buses comprises 700 Corporation (CSTC). single-deck buses that can carry about 90 passengers each and 400 double-deck buses capable of carrying up to 190 passengers each. Usually, less than 700 of the buses are in operation, mainly for want of repair and maintenance and sometimes because of a lack of Since CSTC has a staff of about 14,500, the staffing drivers. CSTC has also been plagued by ratio per operational bus is 20.7. fare evasion estimated at more than 15 percent of revenue. As a result of Low productivity and fare evasion, the system requires a Revenues cover only subsidy in the region of $1 million a month. about half of the system s operating costs. Private buses in Calcutta number about 3,150. These buses are operated mainly by small companies or individual owners Most of the private grouped into a number : of route associations. buses are similar in size to the single-deck buses operated by CSTC . Fares for private and public bus services are the same. Despite these similarities, private operators have been able to survive Their success is financially without any subsidy. attributed to very high productivity, which is reflected in low staffing ratios and high fleet availability. The drivers of private buses receive a percentage of revenue, which gives them a As a result, fare losses strong incentive to combat fare evasion. are extremely Low. Private bus operations are estimated to cost of the CSTC and are more than roughly half as much as those covered by revenues. both private and public bus Although the quality of in Calcutta Leaves much to be desired, the private service operators are able to provide more reliable and frequent service This is because the route associations during peak periods. regulate services apply fines when buses run behind and The private companies, which hold almost two-thirds of schedule. the market, p Lay a mayor role in meeting the demand for transport in Calcutta and thus substantially reduce the financial burden on the government.

Nevertheless, excessively buses. high for all

in developing types cities of there

countries vehicles, is

traffic including

accident both public about

rates

are

and private the safety of

In a number of

particular

concern

- 13 -

paratransit

vehicles.; of vehicle

As a result, inspections,

there

is

a pressing

need

to tighten and road

up

the enforcement safety measures.

insurance

requirements,

The traffic cities, private the part of

congestion

attributed traffic

to private and not private

operators solely operators

is,

in many of

a more general However, exist for

problem for This

the fault

operators. does

the tendency

to aggravate by appropriate

situation

in some cities. buses

can be overcome of

traffic

arrangements to avoid

and by proper loading of

enforcement and unloading space for

regulations. of bus passengers purpose, operators. can be In

Restrictions at busy very

indiscriminate

intersections, without the provision makes it

and the reservation damaging of the financial

this of

effective

viability

particular, facilities

adequate

off-street measures

terminals designed

and interchange congestion.

easier

to enforce

to reduce

Providing competition and cost inclined their between effectiveness.

there

is

adequate is is

traffic

management and enforcement, both the quality operators of

free service

operators This

likely because

to enhance with of

competition,

are more

to be responsive share of the market.

to the needs At the

passengers they

in order will strive

to increase for efficiency services. operators and there is

same time, benefits it

and cost

saving. of

Thus the public adequate

from better is possible

and cheaper for private revenue

In the absence to be highly reducing little costs incentive

competition, their

profitable

by using

monopoly services: of

to maximize with

by providing to respond

substandard to the needs

a monopoly

passengers.

One of that they

the

disadvantages routes.

often

attributed

to private place, costs

operators

is are

shun unprofitable by private lower operators than for

In the first competition, services;

when services are likely

provided

in free public few.

to be unprofitable

substantially routes provide will

hence

the number of consider can be given it

be comparatively on such

Where authorities operators

necessary the

to

services

routes , private

?_I

Paratransit: informally rickshaws,

small passenger on a farepaying etc.

transport vehicles operating basis - eg. converted pickups,

motor

14 -

opportunity capacities, received

to bid

for

operation Operators

of

the routes

at specified

standards, or to

and fares. by them,

bid

on the amount of money to be paid to which bidding they expect the routes give

depending

on the extent Competitive down.

be profitable operators are

or unprofitable.

arrangements private

private

an incentive to operate

to keep costs routes

Alternatively, basis. for (Box

operators Bus

employed

on a contract have

3: Unprofitable services been

Routes). previously

When these

approaches

been adopted subsidies

providing invariably

run by the public

sector,

have

reduced of

substantially, city revenue.

and in some cases

such arrangements

have provided

a source

Public

Bus Corporations:

Improving

Viability

Most public on subsidies. to cover basic (Table

bus corporations 2: Public costs,

experience

large

losses

and rely

heavily able

Bus Corporations: and even fewer

Deficits) are able

Very few are to make a profit.

operating

Table City

2:

Public

Bus Corporations: Year 1985 1984 1984 1985 1984 1985 1985 1982 1984 1984 1985 1983 1985 1986 1985 1985 1985

Deficits Deficit (US$ million) 27.0 0.25 10.5 42.0 21.3 69.0 11.8 2.7 94.5 5.3 33.0 7.3 0.4 2.0 164.8 76.0 22.0

Abidjan (SOTRA) Accra (OSA) Ankara (EGO) Bangkok (BMTA) Bombay (BEST) Cairo (cTA) Calcutta (CSTC) Casablanca (RATC) Delhi (DTC) Istanbul (IETT) Jakarta (PPD) Karachi (KTC) Khartoum (KPPTC) Madras (PTC) Mexico City (RlOO) Sao Paul0 (CMTC) Tunis (SNT)

Source :

World

Bank studies.

15 -

BOX 3:

Unprofitable

Bus Routes city authorities have routes by employing

In a number of developing countries dealt with very unprofitable successfully private operators on contract.

responsible for bus services The public bus corporation To overcome in Istanbul has found most routes to be unprofitable. substantial Losses and because of its inability to meet growing demand, the corporation employs private operators on contract to Not only do the private meet a Large part of its commitments. operators make a profit on these unprofitable routes at the same but they also pay LO percent fares that the corporation charges, in Bangkok most of their revenue to the municipality. Similarly, Bangkok Mass of the public corporation s routes are unprofitable. Transit Authority (BMTA), with losses of $40 million* in 1985, has turned increasingly to the private sector to run routes on a the private operators, using Under the contract, contract basis. their own bus or buses leased from BMTA, supply services at specified performance Levels and fares. Even at the low standard fares that apply to all services in Bangkok, they are able to make a profit. BMTA receives over $12 million per annum In addition, in payments from contracted private operators. after the Jamaica Omnibus Service In Kingston, Jamaica, was taken over by the government, productivity dropped and costs rose to the extent that by 1983 the service was costing the government over $1 million every month in deficit financing. ALL At this point the government Leased the routes were unprofitable. assets of the service to the private sector, which once again turned unprofitable routes into profitable ones and produced a small amount of revenue for the government. In a number of cities, Buenos Aires, Daejeon and Santiago for example, the problems of unprofitable routes are overcome by operators organized into cooperatives, who take turns in operating all routes so that they share the Load of those that are unprofitable (see Box 7).

;k ALL figures

are

for

the equivalent

of

U.S.

dollars.

Corporations with a measure of

that

are

financiaLLy and pursue

viable

usually

are

found

to operate

independence

commercial

practices,

including:

Accountability achieve effective

for

performance there

at all is

levels to:

of

management.

To

accountability

a need

16 -

clearly

define

the responsibilities director; the achievements

of

each manager,

including

the managing set and publish answer

down and monitor

expected

of

each manager;

the performance for any shortfalls.

results

and call

upon management to

In the absence to some form of cities committee in India

of

shareholders, or commission

top management should independent of of

be answerable

the corporation. managed bus (Box 4: Successful viable

Several

provide

good

examples

well

corporations; Public

the Cheran Transit displays

Corporation most of

in Coimbatore the desirable

Bus Corporations)

criteria

for

bus services.

Incentives

to reduce

costs

and improve

services.

These

involve:

the

setting

of

performance and to staff standards.

measures

in all

sections

of

the

organization: bonus payments

who improve

their

performance

or meet

predetermined

Payments quantifiable from higher fewer

need

to be clearly for

linked

to readily gains

identifiable and savings

and that result

achievements; bus utilization

example,

revenue collection,

and revenue etc.

reduced

fuel

consumption,

breakdowns

and accidents,

Cost routes. These

controls systems

covering should

operation, be designed

maintenance, to:

administration,

and

determine organization corrected; identify services

the cost

of

the various adverse trends

functions

and units

of and

the

so that

can be detected

profitable provided

and unprofitable to meet social

routes objectives;

and the and

true

cost

of

17 -

measure including

cost

performance provided

and compare by private

it

with

similar

services,

those

operators.

Armed with whether revenue or not it is

this

information value

the corporation for money,

is

able

to establish to increase

getting

make adjustments for providing

and reduce

costs,

and assess

options

services.

Rational issues Study ) are

policies

on subsidies,

routes,

fares,

and staffing.

(Policy

discussed

in detail corporations

in Urban Transport: should ensure that:

A World Bank Policy

In brief,

subsidies, and economic all time routes effective, fares are

if

unavoidable, benefits

are

clearly

defined

and the

social

have been accurately

assessed

and outweigh

the costs. to ensure

Subsidies that they

need to be reassessed remain valid; of

from time-to-

and services

respond

to the needs adjusted

the public,

are

cost

and can be readily clearly related

to meet changing preferably

demand;

to total and of

costs,

on a route-

by-route staff levels is

and distance rewarded related

basis;

on the basis

performance (the

and staffing needs staff). to

are

to the workload authority

corporation and replace

have and to exercise

to hire

BOX 4:

Successful

Public

Bus Corporations

Of the few publicly owned bus corporations that are financially viable and able to provide satisfactory services, the Corporation (CTC) in Coimbatore, India, is Chetan Transit CTC was created in 1972 when the particularly worthy of note. state government nationalized private transport undertakings. It is a semiautonomous authority with a high degree of financial and but fare increases require the approval operational independence, of the state government. CTC does not have an exclusive franchise but operates in direct competition with private buses. The corporation operates some 1,100 large single-deck buses, with a very high level of over 95 percent of the fleet is put into service on a efficiency: regular basis.

18 -

distance of 321 Each city bus covers an average CTC currently kilometers and carries 1,100 passengers each day. at 7.3 per operating bus, has a staff of 7,580. The staff ratio, is comparatively low for public bus corporations and is a very Despite very important factor contributing to CTC s efficiency. low fares ($0.04 for a 5 kilometer trip), CTC is able to make a profit, ($750,000 in 1984/5), which enables it to expand its fleet in line with demand. Much of the success of CTC must be attributed to its accountable management its degree of dynamic and and the corporation pursues prudent commercial independence. Also, policies and undertakes comprehensive monitoring and costing of An important reason for its high productivity is the services. based on revenue gains and savings payment of bonuses to staff, higher utilization better fare that result from bus and Bus drivers also are awarded an annual bonus for collection. accident-free driving.

Bus Companies

in Mixed Ownership

In a number of authorities category obligations of and partly operates of under

cities

the

bus companies enterprises. with

are

owned partly

by public

by private a contract are

Typically, of

a company in this in which the

a ministry defined. fare

government

both

parties

clearly timely

Usually

the main obligations with subsidy costs. of rising is On its and to

the government

are

to approve a subsidy

increases maximum. of

in line This

costs

and to provide to cover

up to an agreed fares

designed part,

concessionary is required targets.

and a share a specified

capital quantity

the company

to operate

buses

meet agreed

performance

In some cases, bus manufacturer in Africa, support where or the

a large

share There

of are

the

company

is

held of

by an overseas this arrangement

supplier.

several greatly

examples

company may benefit (Box

from overseas

technical Also, since the

and training. has a share becomes

5 : Mixed Ownership company, it is

Bus Companies). in its the own interest subsidy

government fares

in the

to raise However, less

when this tend for

necessary costly, in purely

and thus

keep

down. are

services than those

to be very services

and although public

the

subsidies they are

generally

ownership,

still

19 -

excessive. be a risk purchase lost. of

Since lack

the company is of freedom

tied

to a particular of buses

manufacturer, and spares. of

there

may

in the choice

As a result, may be

prices

may not

be competitive

and the benefits

flexibility

I-

BOX 5: Mixed Ownership

Bus Companies

services in Dakar are provided by Public transport public bus company; car rapides , a mixed-ownership Sixty-four percent of owned minibuses; and taxis. privately SOTRAC is owned by the state, 27 percent by an overseas bus and the remainder by local private interests. The manufacturer, board of SOTBAC reports to the Land Transport Directorate of the The relationship between the Ministry and Ministry of Equipment. SOT&K has been formalized by a three-year contract plan which and agreements reached between clearly sets out the obligations The main obligations of the state are the state and the operator. to ensure regular fare revisions in line with rises in costs and to provide a subsidy up to a fixed maximum ($3.5 million in 1986) to compensate for concessionary fares (students, children) and to help cover investments. In turn, the operator must meet certain productivity and financial targets, which are constantly monitored during the period of the contract. The public bus operator currently owns 458 buses, of which 85-90 percent are put into The company employs 2,868 staff or about seven service each day. staff per operating bus.
SOTBAC ,

Conventional bus services in Abidjan are provided by SOTBA, a public enterprise of which 60 percent of the shares are overseas the state bus owned by and 40 percent by an plan As in contract manufacturer. three-year Dakar, a the relationship between SOTRA and the Ministry of formalizes Public Works and Communications, which sets fares and monitors Substantial increases in productivity have been performance. recorded since the beginning of the contract, and annual subsidies from the government have been fixed at a maximum of FCFA 8 billion SOTRA currently operates 869 buses, of which 85($16.8 million). 90 percent are utilized every day. The company employs 6,000 staff, or 5.9 staff per operating bus. In both cities, the contracting approach and mixed some beneficial results. ownership have given Productivity has risen and financial performance has improved. However, al though the high cost of services and the need for hefty somewhat reduced, subsidies is a major source of concern. These problems have been exacerbated by delays with fare increases and subsidy payments.

- 20 -

Size

of

Undertakings

(Company or Corporation

Size)

With few exceptions, viability. involve They are complex often

large centrally

bus undertakings controlled that public are

lack

financial and

corporations difficult

and unwieldly

organizations

to manage.

Where large well likely region structured to of

undertakings into of

are

profitable, manageable

usually units.

they

are

found is

to be

and divided a fleet Often day-to-day

several

Each unit

comprise the city. for

about

lOO-to-200

buses

and to cover

a particular full by his own

each

region

has a manager delegated of staff. services, Certain who is

with

responsibility team of trarnlng, being have with


. .

running

supported

technical purchase

and administrative of spares

functions,

such as may benefit generally deal from

and buses,

and major undertakings,

overhauls, unit

centralized. a fair degree

But in successful of autonomy

managers

and sufficient

authority

to effectively

bus operations

in their

region.

As a rule, than large the are their being result, form of privately chances small,

small

bus undertakings More often

are

found this

to be more profitable is due to the influence of

undertakings. ownership owned, of they

than not,

and style which for

of management. various reasons

Most small already

bus undertakings increases is that

discussed, factor

being are are

financially comparatively likely

viable. simple

A contributing

to manage and control. Leakage of

As a

overheads

to be very

Low and revenue

insignificant. economies overcome of

Although scale, this

small is

undertakings

may be deprived

certain and can be

unlikely together is

to be a serious to provide evidence small

disadvantage

when operators However,

group there

mutually

beneficial

services that

and facilities. benefits derive

Little

to support

suggestions into a Large approach

from merging

a number of

bus services in Box 6,

undertaking, generally is

in fact very

in practice,

as illustrated

this

costly.

- 21 -

BOX 6:

Large

Undertakings

In the expectation of achieving economies of scale and several city authorities have consolidated many better services, corporations. undertakings single, large small bus into Invariably the process has achieved the reverse results - costs have risen steeply and services have deteriorated. taken in Buenos Aires. A Typical are the measures national enterprise was set up in 1951 to take over the many small Services deteriorated from the outset, bus services in the city. By 1962, the and by 1959 the system was losing $120,000 a day. financial situation was so serious and the quality of service so poor that the enterprise was dissolved, and bus services were turned over to a Large number of small private companies. there are some. 90 bus companies ranging In Seoul, Korea, A detailed cost analysis carried in size from 30-to-200 buses. out in 1985 by the Korean Advanced Institute of Science and Technology found no correlation between costs and company size. The study concluded that there was Little, if anything, to be gained from amalgamating the companies into larger units. Bangkok s 24 private bus companies and two In 1975, into a single Large company public companies were consolidated The that became the Bangkok Mass Transit Authority (BMTA). objectives of the merger were to rationalize routes, schedules, to generate economies of scale: and to structures; and fare Results have been provide better service to the public. risen the particular, have and disappointing; in costs organization Loses over $40 million every year. A similar process has taken place in Sri Lanka, where the Central Transport Board (CTB), which took over all bus services, became overwhelmed by its own size as it attempted unsuccessfully Subsequently, it became to cope with sustained growth in demand. necessary to encourage the private sector, comprising many small to enter the market and put an end to CTB s undertakings, monopoly. there are a number of large undertakings In contrast, that go against the trend; for example, in Hongkong, Bombay, But in each case, and Coimbatore (see also Box 3). Madras, operations are divided into manageable units of 200-300 buses, and each unit head is delegated with full responsibility for day-today running of services and staff management.

- 22 -

CHAPTER3

VARIETY OF VEHICLES AND SERVICES

Bus services for passengers when:

are more likely

to be cost

effective

and satisfactory

a variety different throughout the buses conversions technicians; operators used.

of

buses of

and services demand for

are employed quantity

to meet the found

levels

and quality

urban areas; used are readily production-line maintained models by operators or low-cost and local

have

freedom

of

choice

in the

type

and size

of

buses

Size

and Demand

In order throughout sustained. reasonably Thus, well their

to be cost period of

effective, operation;

buses that is,

need high

to be well load

utilized need to be to be

factors

At the frequent of

same time, (roughly

to provide five-to-ten need that

satisfactory minute

service

buses

need

headways if

in urban they are

areas). to be both have two

on routes utilized

low demand buses Buses partly that

to be small are too large

and frequent. to operate with

for

the route or

alternatives: less frequently results

empty, ensures

maintaning financial

frequency, viability;

to operate latter, of a

a load

the

course,

in excessive

waiting

by passengers. minibuses, each

For example, with of a capacity minutes.

in meeting of 20 A

low demand of passengers, standard one-quarter to be reduced

240 passengers/hour, be fully utilized

would bus,

at a frequency at a five the

five

capacity full;

80 passengers, utilized

minute

frequency

would

be only

to be fully

standard

bus frequency

would have

to 20 minute

intervals.

- 23 -

In considering account vehicles, of narrow operating often streets

the

size

of Small

buses,

there

is

also

a need

to

take

into

conditions. are the only

vehicles, transport

in particular able parts

paratransit the labyrinth

form of found

to penetrate of cities

sometimes small

in the old

and in squatter speeds, Because

areas. especially of

In addition,

vehicles

can be operated allowing service for and,

at higher

on congested

streets,

a quicker

turnaround.

the benefits small

of more frequent vehicles of small

in some cases, Experience to their

door-to-door shows that and these

service,

may command higher buses

fares.

characteristics chances of

add significantly

popularity

financial

viability.

On high-demand assured, Small high large-capacity also

routes, buses

and at times at high

when high

load

factors cost

are

frequency

can be very

effective. but the very in

buses

may prove involved

to be effective may well create

on high-demand substantial buses

routes,

frequencies

external clearly

costs,

particular, advantageous energy per

congestion when the passenger buses Under the one third of

and pollution. full benefit of

Large their ,In

are most road for space and

economical exclusive

use of

can be utilized. can carry

busways, passengers that

example, in one

large-capacity direction. cope with

in excess it

of is

30,000

per hour

same conditions, that amount.

unlikely

minibuses

could

Levels routes. frequency throughout. changes conditions. their during period. off-peak off-peak

of

demand vary be impractical

from time-to-time to meet all to provide operators

and from place-to-place in bus size of only services and

along

St would that

the changes

would

be necessary in practice,

optimum levels usually provide for

Hence,

two or three

in service

along

any particular

route

to adjust

peak and off-peak frequency some light for loading peak

Operators, as well hours

who may aim to provide as peak passengers, is compensated for

an acceptable that loading

recognize by heavy

during

the

Although some combination

a city s of large,

needs

will

depend

on its vehicles

particular will

circumstances, provide the

medium,

and small

usually

- 24 -

best allows

bus service. for

(Box

7:

Size

of

Buses and Level and better routes

of

Demand).

A mixed

fleet

more convenient, low-

frequent,

utilized

services

throughout to changing

the day on both circumstances.

and high-demand

and is

more adaptable

BOX 7:

Size

of

Buses and Level

of

Demand

Public transport in Jakarta is provided by 2,000 publicly owned and 500 privately owned large buses with a capacity of BOsome 3,350 privately owned 20-seater 120 passengers each, These buses and 2,000 private lo-seater microbuses. minibuses, in large buses, carry 3.3 million passengers daily -- 1.8 million and 0.2 million in microbuses. 1.3 million in minibuses, Large buses are concentrated along the main commuter Most corridors and achieve high load factors at high frequency. minibuses and microbuses provide frequent feeder services to the main bus routes and are well suited for the lower level of demand conditions found in the secondary road and the poor road network. Some minibuses and microbuses operate along the main corridors in Jakarta and provide a useful supplement to regular buses at peak periods. A similar relationship exists between Large and small operated by a franchised, buses in Nairobi. Some 300 Large buses, privately owned company, Kenya Bus Service (KBS), carry an average Also operating in and around the city 400,000 passengers per day. These are small buses and converted are 1,300-to-l,500 matatus. pick-ups with a capacity of between 12-to-25 passengers each. In Both the matatus carry about 260,000 passengers each day. total, Large buses and the matatus ply the main commuter routes and serve But matatus also provide very useful and cheap the city center. services ($0.10 per 5 kilometers) between Low-income areas and industrial areas Located on the outskirts of the city and along routes that cannot be operated by KBS at a profit. Another good example of bus sizes well adjusted to demand some 2,400 high-capacity buses, is provided by Istanbul. Here, including articulated buses with a capacity of over 200 passengers On a number of routes each, ply along corridors of heavy demand. they operate in exclusive rights-of-way dealing with particularly Large buses, in total, carry over 2 high volumes of passengers. In contrast, in comparatively Lowmillion passengers each day. density and hilly areas in the suburbs of Istanbul, minibuses come into their own and provide frequent service at low fares to 1.5 Minibuses are heavily utilized and million passengers each day. services for their passengers, as well as provide popular providing owners with a good financial return.

- 25 -

Size,

Type,

and Maintenance

For costs viable, costs of attention the buses. vehicles) are generally

to be kept needs

low , so that to both

bus services the capital production-line

can be financially costs and running (i.e., vehicles than of Urban massor

to be given

Experience and local

shows that

buses

produced chasis

conversions cheaper

based

on production-line and maintain Capital Cost

substantially or custom-built,

to purchase (Table 3:

limited-production, Buses (1986).

buses.

Table

3:

Capital

Cost

of

Urban Buses

(1986)

Type of Minibus Small bus bus

Bus

Capacity Seated 12 20 40 bus bus bus 50 80 80 55 bus 55

Total 20 30 80 100 120 170 120 190 particularly

Purchase Price Excluding Tax (USS) 25,000 40,000 50,000 80,000 100,000 120,000 130,000 150,000 where buses are
]

]
] I ]

Standard Large Large

Usually production line vehicles

single-deck double-deck

Super-large Articulated

double-deck bus

,Super-articulated

[Wide variations in price can be expected, locally assembled or locally manufactured]

Source:

World Bank study.

Operating influenced since buses

costs,

in particular of vehicle.

the cost Proper

of

maintenance, is vitally

are

greatly important that are

by the choice often travel

maintenance

60,000-to-70,000

kilometers

per year.

Buses

- 26 -

not

properly

maintained life, thus

will

suffer their
; poor

from substantially cost effectiveness. causes

reduced

output

and high and

operational external excessive Experience small buses,

reducing

In addition, air pollution holdups. minibuses often

costs noise

may be involved and leads

maintenance breakdowns vehicles, for

to frequent

and traffic in particular which

shows that require

production-line only basic with skills a little often

and

maintenance,

can be especially

undertaken those that

by the driver are custom (for example, etc.). and special

assistance.

Larger

buses,

built,

involve

sophisticated systems,

and nonstandard remote control doors,

equipment relay trained

retarders, As a result, facilities

articulation maintenance
, adding

circuitry staff

may require

specifically costs.

considerably

to the

A major parts situation. variety

factor Often of

in the cost

of

maintenance of

and bus output vehicles

is

the

spare

the components both buses

production-line cars

are

common As a

to a wide result, purchased

models,

and trucks, available

and minibuses. can be

spares off

are more Likely the shelf at the the need for

to be readily local spares spares are

and often

distributor likely

or a service

garage. to are less

Under these purchase likely

circumstances, that

to be much cheaper Also, spares buses --

than those to be off found

to be specialLy long periods

ordered. for

the road in heavily of

waiting

a frequent are

ingredient cannibalized is

Loss making bus services. spares, of the resulting

Where the vehicles Loss of productivity

because

a Lack of

particularly

damaging

to any chances

viability.

Freedom of

Choice

Because levels far of

of

the

operator s

intimate costs, buses

knowledge freely

of chosen

road

conditions, are

demand, and operating to be cost government

by operators

more likely

effective regulation.

and appropriate

than vehicles

specified

by inflexible

Where operators variety variety of of types and sizes

are of

free

to choose, minibuses,

it

is

not

uncommon to

find

a and a

buses,

and paratransit in their

vehicles choice,

services.

Moreover,

when not

restricted

operators

- 27 -

are able commercial demands.

to respond advantage

quickly as well

to changing

circumstances a service

and to retain more suited

as to provide

to users

While have proven smaller city

there

are many examples their where

of

operators

choosing is

Large

buses

that the

to be cost-effective, Even in a city numbers of

inclination small vehicles

generally are banned vehicles

towards

vehicles. large

from the often

center,

small

buses of

and paratransit

proliferate

throughout

the remainder

the city.

Apart maintenance

from better

utilization,

Lower capital the tendency

cost,

and ease vehicles

of stems

(mentioned other

previously), factors, for

towards

small

from a number of

example:

(a)

drivers

of

small for

buses driving

often

have

to meet Less than do drivers

stringent of large for buses

requirements and thus buses (b)

permits

can be paid

Less;

inspection than for in a higher

requirements Large ratio buses; of

small

may also small this

be Less costly buses result

although passengers, developing

drivers in

to

may not

be a significant labor costs are buses

disadvantage low;

countries easier

where

(c)

fares

are

to collect of revenue

on small Leakage

than on Large

buses,

and the

chances

are much reduced.

However,

it

is of

clear Large,

that

for

viability, small

operators buses based

should on their

be free

to choose and

from a range commercial

medium or

preferences

judgement.

Varietv

of

Services

Given more closely vehicles at higher

freedom

in the choice of

of

buses,

operators which are

are

able

to respond to range from

to the

preferences conditions

passengers, at Low fares

Likely

offering fares.

basic

to more comfortable are able

vehicles to buy

Where incomes

are

rising

and more people

- 28 -

cars, if will

the transport is

system

will

need

to include Certainly,

more attractive a growing a seat

bus services of air for such demand

bus patronage be for

to be retained. that

proportion and are

bus services or heated.

guarantee

passengers are willing

conditioned levels of

Many passengers

to pay extra

comfort.

In addition also well be varied

to different different

levels

of

comfort, of

mode of

operation

may as

to capture regular

segments

the market. it is

For example, likely to be

as providing

bus and minibus

services,

profitable

to provide

at premium fares:

express shuttle particular District shared

bus service bus service residential (CBD); paratransit

with

limited

stops; locations, such as a Business

between

designated

development

and the Central

services

with

routes

determined

by individual

passengers; personalized, door-to-door paratransit services.

Where operators quality services

are

discouraged

from,

or not slice of

allowed

to provide is lost, road

at premium fares, result will

a valuable growth

the market use.

which will congestion services

inevitably and delays will

in a rapid increase

in car

As a result, of bus

and the

viability

and quality

be eroded.

Although better continue (likely fares. quality

there

is

likely

to be a growing will,

need

in most cities same time, need for

for to those for lower

bus services, frequent,

bus systems reliable, willing

at the

to include

and low-cost to sacrifice

bus

services

to be a majority)

who are

some comfort

Demands for these two extremes, demands,

various

levels

of

services are able

are

likely

to fall their

between services to the to

and where operators the chances of

to tailor

meet these

financial

viability

and service

29 -

public

are greatly

increased. of variety

Hong Kong (Box 8: in the provision

Variety of

of

Services)

provides

an excellent

example

bus services.

BOX 8:

Variety

of

Services

In Hong Kong, buses account for by far the largest number The Kowloon Motor Bus Company operates 200 routes in of trips. the New Territories, about 3 million carrying Kowloon and The China Motor Bus in 2,700 double-deck buses. passengers mainly on Hong Kong Island, carrying Company operates 102 routes, daily on 1,000 double-deck buses. about 0.8 miLLion passengers The two companies also compete on fifteen routes that run through Most of the buses have a capacity of 120 the cross-harbor tunnel. and generally operate throughout the day at high passengers Both companies are making frequencies and high load factors. super-large, increasing double-deck buses that were use of developed specifically for Hong Kong and can carry up to 170 These are used on routes where demand is heavy enough passengers. to run almost fully loaded buses frequently throughout most of the range between $0.10 and day. Fares, which are set by government, $0.20. At the other end of the scale are 4,350 public light buses (PLBs). These are fourteen-seat minibuses, mostly individually owned and free to operate almost anywhere at whatever fare they decide to charge. These PLBs compete directly with bus and tram services and carry more than 1.5 million passengers Passengers are guaranteed a seat and pay fares that may be daily. as much as double those charged on the large, franchised buses, peak periods. particularly during air Some minibuses are conditioned. About 1,100 PLBs, termed maxicabs, have been franchised to service routes that are not suitable for double-deck buses, either because demand is not sufficient to sustain high-frequency service or because the routes ate, too hilly or too tortuous for Maxicabs operate on fixed routes and at fixed fares large buses. that are slightly higher than those of the large, franchised buses. To meet the needs of people Living in new residentiaL developments where service was inadequate, premium residential coach services were introduced in 1982. These services are run by under contract to operators the developers of the private residential areas or to associations of residents. Although these services are regulated to avoid conflicts with the franchises of the main bus companies, the fares are not fixed by the Most of the residential coach services use mediumgovernment.

- 30 -

usually air-conditioned, that have a capacity to seat size buses, The privately owned residential coach about fifty passengers. services and similar services for transporting factory workers and schoolchildren utilize about 2,500 buses and 2,200 minibuses. Hong Kong now has a total bus fleet of over 12,000 vehicles, ranging in size from the 14-seat minibuses to the 170This comprehensive bus fleet is able passenger double-deck buses. to meet a wide variety of demands for transport at different levels of quantity and quality of service.

A concern and sizes is said of that very buses

that will

is

sometimes

raised

is

that

freedom

of

choice vehicles. operators,

of

types It they

result these

in an excessive

number of

small

although high

may be highly costs if

profitable

to their traffic

involve

external faults,

due to road they

congestion, usually

accidents, more

and pollution. cost effectively buses

These

do arise,

can be overcome

by strengthening that are not favor factors, play

traffic

regulation

and enforcement judgment are not of

than by

specifying

based Large

on the commercial buses but these

operators. by almost

Where conditions operators, certainly

clearly

chosen will

some other have

such as, and need

official

regulations,

come into

to be rectified.

Drawbacks

of

Standardization

Authorities bus types external for costs,

in some cities

have It is

pressed said

for that

the

standardization

of

a number oaf reasons. standardization will

in addition

to reducing

Lower costs

through:

(a)

improved tasks

maintenance with

and output, the operation

by reducing of a fleet

the variety of different

of

involved

vehicles;

(b)

reduced of scale

quantity through

and variety bulk

of

spares

inventories

and economies

purchasing;

and similarly

(cl

economies

of

scale

through

the

bulk

purchasing

of

buses.

- 31 -

While experience counteracted particular different Another monopoly, Although Locked

it

is

true they

that often

these fall

benefits short It of is

of

standardization

may arise,

shows that by serious design levels serious are of

expectations quite clear

and may be that buses all of one

disadvantages. unlikely to be cost quantity that

effective and quality

in meeting throughout is buses Likely

the

demand for is

a city. to create a

disadvantage

standardization supply of

or a partial the initial

monopoly, orders

in the

and components. bids, for once This these is often favor a system is

may be based of

on competitive

into

a particular and cost

type

bus the opportunities be substantially

subsequent

competition particularly a particular circumstances

saving

will

reduced. since

so when rigid manufacturer. will be stifled

specifications Certainly, by rigid

are applied, innovation specifications.

in meeting

changing

A certain not imposed with switch is

degree

of

standardization occurs it event is

may be beneficial because important that they have particular to retain

when this models

is become

by regulation, operators. to other

but rather Nevertheless, models to occur in the

popular nity to

the opportu-

become more competitive, freedom of choice.

and this

more likely

where operators

- 32 -

CHAPTER4

COOPERATION BETWEEN OPERATORS

Cooperation viability

between

bus operators bus services.

can lead

to

improved

financial

and more satisfactory

In a number of resulted benefiting their unions in the provision both

cities of

cooperation more

among private

operators

has

cost-effective traveling formed route

and reliable public.

services, at

the operators operators

and the have are

In most cases (operators to

own initiative, or cooperatives, miscellaneous and control free-for-all, (Table 4:

associations

as they services, that

sometimes

called).

In addition exercise informal

providing supervision complete other. way,

the organizations an effective

provides

compromise

between regulation

a at the In this market

at one extreme, Cooperatives

and undue government and Route often

Bus Unions,

Associations). to free sector has led of

the disruptive

and dangerous without

practices discouraging however,

attributed

conditions healthy restrictive

can be avoided competition. practices

the private cooperation

or reducing to

In some cases, and price fixing,

to the disadvantage

the public.

Function

of

Route

Associations

Although generally for their

route purposes

associations are similar:

may take

a variety mutual

of

different

forms, and a forum and policy

to provide fares,

assistance

discussing

with

public contracts the

authorities

routes, labor

facilities,

issues; resources. provide reduce

negotiating Within services costs to

and wages with of mutual

unions;

and pooling often scale and

framework

assistance,

the associations from economies of

their

members that

may benefit

including:

the management the purchase the provision of

of

terminals

and dispatching

vehicles;

vehicles servicing

and spares; and maintenance facilities:

of

- 33 -

common insurance, the training market of

legal drivers

advice,

and assistance;

and mechanics; relations.

research

and public

The benefit authorities of individual

of

associations applies and there

providing particularly is a need for

a point

of

contact are

between

city

and operators, operators

when there consultation.

large

numbers

BOX 9:

Route

Associations

in the Republic of Korea, provides a good Dae ieon, transport system managed by an example of a successful public A unique feature of the system association of private bus owners. is the route sharing introduced in 1980 to overcome the problem of The city is divided into four geographical unprofitable routes. supplied by the various bus each served by 100 buses areas, Each fleet of 100 buses is rotated weekly to serve a companies. different section of the city. There are 60 bus routes in the city, 20 of which operate at the request of city authorities. These 20 routes lose money, but each company serves the routes in The operators make a turn, and their losses are equalized. while the users benefit from good bus service reasonable profit, at acceptable fares. The public transport system in Buenos Aires is also run operators within a framework of control by individual private exercised by 300 route associations (empresas). Some 15,000 colectivos , account for 75 percent of public called buses, with a capacity of 60 transport trips in the city. The buses, are usually operated by owner-drivers. Each passengers each, routes and empowered to serve only two or three empresa is comprises between 30 and 300 buses. Routes frequently overlap those of other empresas. Although the government sets fares and minimum frequencies of operation, the empresas select and employ individual operators by contract, set schedules, and provide administrative services. They also assist with maintenance, although this is often undertaken by owner-drivers. An important function of the empresas is to assure fair distribution of income among operators, usually in accordance with vehicle mileage. compete vigorously among themselves for empresas Since fares are fixed, the empresas emphasize quality patronage. and frequency of service, to the benefit of 10 million passengers who use the colectivos daily. The

- 34 -

In several schedule services,

cities and they

the route may collect is

associations and share

allocate out

bus routes (Box 9:

and Route

revenue. to overcome unattractive

Associations). of providing

This services need

function on routes

undertaken that are

in order

the problem but which of

commercially

nonetheless income service complete concentrate and other

bus service. so that are not

The aim is those

a more equitable a less these

distribution

among operators to the public disorder only road

providing Also,

rewarding

but valuable prevent otherwise

penalized.

arrangements &ould all

in downtown areas on the busiest

in cases

where operators of

routes,

to the detriment

bus operators

users.

Competition

It operators Certainly, competition to compete convenience

is

important

that This

in any of

these

arrangements

competition cities.

between

is maintained. where will for individual prevail. patronage

has been achieved are able fares

in a number of to set are their

operators

own fares, operators service, are able as well as

But even where by emphasizing where these

fixed,

fast

and frequent are

and comfort

qualities

demanded by the public.

Disadvantages

of

Cooperation

One of they that may conspire eliminate

the disadvantages to maximize

of

cooperation

between

operators

is

that

profits

by introducing supply.

restrictive

practices disadvantage for are on

competition

or suppress

A particular through their

the public allowed particular with fares public.

arises

when established access

operators,

associations, buses operating is

to control routes.

to the market

and the number of a private of services to

Under these the quantity and there

circumstances, and quality is inadequate

monopoly suffer,

created

the result

that

excessive of the

may be charged,

response

the needs

NEGOTIATIONS WITH *THOR,TIES NIOIIS AND

SCHEOL,NO

REMARKS

569 ,460 ISSO

large nllb*e*

buael trucks

Private Transport IO Of

Road lo

Vehicle, frol bI er ro+a,, eh,cle, < *ml,

,r, +erlla,s

dIspatched

Th,

IO ldlfdSl

,,I.x.+b,

ro+es

to

oper*+or*

converted

prtrats

too pr,rs+a
BAMAKO

bf_,

Ornsrs

NO
*I-*

dlsps+ch*d es I,

from
callscted

Ths .SCh 0 Crers tlla by

.,*OCl,+lO

m,tc**
h,, * *Jr

,ur*

+ll*+ sllsre

es0

dovro!, *da*) b,.,

18

rou+e

s**ocls+lon*

YSS

,,res, router,
*t-e

teraln,,,

f,

operator
the nmrli.+

tconrsrtsd BOCOTA 9300 and

for
3.5

e,Ch

dap,r+re,

pr,va+s
=b,e+.*

.snprs*a*~ trout* a,*ocla+lon*~


2 umbrell, nlon, **soop,r,+. TOte*; (FAT&=,

Sslarlsr,

srs
orner,

chore but

by .mployed

trlnlburea)

snd 300

nego+l,+sd by
l.c., Sslarls,, f,T.,, ,re rO+,*.

tsres

the

empre,, orn*r II,, , contract rttll by ti-8. by the

.~mpr~,*,, ,hlCh *esr,l n,+lon,l lo or on,

-E,.ch

BUENOS

b,RES

,500o t,n,fI .I,b

colsctlo, b,,,) 5000 orn,r*

cletlonr one and

mbrsl,,

nsgot 1 ated by FATAP,

conp tsts and route


every
reek

,Ch.d

I I

ng

snd ths -Crer*

cvrrant ,re

eccount emplasd

,+erchsg~ng

*lnpre*, +hogh choasn

enlpr*,,. O.,S Tha lo , termfnal,

COII.C+, conwll**lon for

,n ,+ **cl?

annual +srnln,ls trrp

fee ma*,

,I,000 and 2,200 and

.!crobses sksred prlvats 950 n,nlb,e, +*x1* buses

lo

shsred

tax,

Yes

Op.X*+O~* Routs plus 0 bus COmIr++ee, +*o umbra,,, tmlnlb,, *lo orner,

t,r**. router,
,

Yehlcles from .hlCI., and

sre
+erfnlsl* ,re

dl*p,tched

plus at

,
% I

teralnals~ lo, *slarle*. snd

negotiate
*re*

,Ch,d,*d +ron

A lne ts paid by
*ho rn behind h,, to *or, The2 syrten

oper,+or,

dlrpstched

,chedIs sq,llrsd and nacle lCO, It

rou+e*
sres,,
of NO +ll* by , I,0 HO NO (0 J 07 group, e,ch each 4 rotate ,d,ld,l company rotate Th, only l-0,. I , Of ,y the to *II rotatton COOp.r.+le r.J+. Interchanglng~ I, served caapsnts,. every rc.u+s* rlth! by s group ,d .eek among po,,tbld rou+e, conpan!,,

DAEJEON

490 by

b,e, 11

operated

one (25

Cooperatl, snployes,,

compsnlss

Th,,. rsek.. , Op.r,+.d

nprO l+abls

0 AEG

,,200 by 630 b 950 3800 3.400 2.000 9 34

b,e,

operated

one

coop.~,+I.

to

allocats

rou+ss

to

each

companls, operated one b*e* ROUT, cooperstl ,*,ocl,+lon* ,,,ocl,+lo, KopoJ,) mlk;ro,e+ *.h,t, BUS ve A nsr ,-O+e, snlcle,

conpany

,q,lIzs 26 route,

pro ,+*
s,,,gnmsn+
I, operated ,re

b,,, pr,v,+e

of

b,,, svsry

to day

Esch I ,

b, month

opsrsts by

compsnls, minlbvse, .Inlb,e, mlkroletr

dl,D,+ched

2 mlnlb, (Mstronlnl. and buses trucks) and lo, Tr,*pOrt Seven one Of ,,,O.Gl,+lO

ThO

a*socla+ton*

,I

tmlcrobuse,) 2,200 A,,,ta

routss
Th.s

to

Idlld.l lnclvde, cl+),

,ocs+e operator*
both cl+

union
Infer

tconvsrted 1,310 MONTE IDE0 80 bus,,

rO +t)*)
pr,v,+s es torganlzed Yes

and The Complete org,l*a+ion ,clledul,og Of and servtce


r.s*e*

operator*
COIIeC+*

cooDsrs+ie pard tll, on or act,! s

cooperatl ,, r*+e

,tars*,

from op.r*+ors.
per-km ree, b,,t, p,,l+l,,

ornerr
rtth

trolleybuses

as*ocl,tton*)

rO+.S*, freq.nc1**:

,re bon,,, to

accordiog COIIeCted

NAIROBI

- 36 -

These problems governments policies unions success the first are are are prepared

are more likely to display and upheld.

to be avoided political with

or reduced will

where that or of In their

strong Dealing

to ensure

introduced

wayward associations more chance of the

may be far if careful place, illegal.

from easy, steps it should This While are

but attempts taken

to do so stand the support restrictive

to obtain that

public.

be made clear can be achieved direct

practices

and price antithe

fixing trust

by introducing

and publicizing limited effect, and

legislation. of

enforcement

may have only of

existence strengthens

appropriate the hand of

laws clarifies government

the rights

the public support.

in enlisting support

public

The public its views channels on

can be given bus services for airing

the opportunity through complaints, public

to show its hearings

and to express up appropriate

and by setting

including

consumer

organizations.

Also, are not

there

is

a need

to ensure the private

that

the government s to pursue

own procedures

unwittingly

assisting

sector applications

harmful buses or to restrict cases, the are

practices. routed unions. entry, ability

For example, through, Clearly or have this

in some cities to be endorsed these

to operate associations

by,

operators

gives

organizations policy.

the opportunity In other has been

which of

may be contrary to adversely

to government effect

unions

bus services

unintentionally and types of by

strengthened bus services carefully

by government that reviewing

restrictions

on the number of Anomalies of this

unions

can be operated. procedures

sort with

can be avoided government

to ensure

compatability

policy.

- 37 -

CHAPTER 5

THE ROLE OF GOVERNMENT IN PUBLIC TRANSPORT

Al though running allow bus services operators both

governments themselves,

and city they

authorities

are

rarely

successful conditions

in that

can do much to create that are able

to provide quality

viable

bus services

to meet growing

demands for

and quantity.

Regulation

Bus services, government that regulation.

as a rule, (Box 10: is

work more efficiently Minimal the Regulation).

with This is

a minimum of not to suggest novices dozens unwise;

a complete large,

free-for-all double-decker to load

solution. clearly

For example, would be folly. would

to permit To allow

to drive of

buses

minibuses would

freedom almost

and unload concentrate Nevertheless,

at will, on major there of access

be similarly

they

certainly congestion.

intersections is much scope This

and create in many cities applies levels of

serious to

traffic

improve

bus services

by the relaxation that affect

regulations.

particularly service,

to regulations and choice of

to the market,

fares,

vehicles.

Access satisfactory In other to traffic any their result

to the Market. access

To ensure

the

ready

availability not be unduly standards

of restricted. and comply and run to expand may

services, words,

to the market

should

new operators should Similarly,

who meet reasonable be allowed existing to enter operators is

safety

regulations, buses.

the bus business should be free and this

number of services.

Where access of

to the market unions

restricted--

from the activities and franchises-operators

or associations, situation

as well arises.

as government When this

regulation occurs, infrequent overcome inevitably into losses.

a monopolistic

may be encouraged services. (e.g., of

to maximize Further

returns

by providing in an attempt to

and overloaded such a situation falls short

regulation levels of

regulated and,

service

and fares) to turn profits

expectations

in any case,

tends

- 38 -

Where free stimulated public.

access

to the market are more likely

is maintained, to respond

healthy

competition of the

is

and operators

to the needs

Fares. is the likely public

Freedom to

set

fares, of

coupled

with

free that

access

to the market, of to and The of

to result

in the provision prices. thereby

bus services same time,

meet the needs are able

at competitive return,

At the

operators of

make a reasonable investment element excessive of

encouraging

the supply

bus services to be met. the chances

in expansion. competition fares being

As a result, in this charged

demand is more likely greatly reduces

arrangement and encourages

efficiency.

In addition, operators quality displayed to provide services

freedom a variety

to set of

fares

at different

levels

enables services to often

bus services- Thus,

from cheap range of

basic

at premium fares. segments of

the wide

preferences

by different

the community

can be met.

On the other advantages. belief Clearly, choice service. subsidies. demand, of that if

hand,

regulated fares are

fares often

have many adverse regulated

effects

and few

For example, they they will are out

at low levels

in the poor. the of

benefit pitched of

the community, below cost, then

in particular, private

the urban have

operators or reducing

going

business,

demanding will

subsidies survive subsidies are

standards

Certainly, Experience investments

public

operators

only

with

heavy

shows that

because

cannot

keep up with standards

in services is

inevitably stunted. be further steps to

curtailed, the poor

deteriorate, expensive

and expansion modes, they

Since

cannot

turn poor

to more are likely

may well

deprived. improve low.

The urban financial

to be better efficiency

served

by effective fares

viability

and

than by keeping

artificially

39 -

BOX 10:

Minimal

Regulation

The fear that unregulated fares will result in operators making excessive profits and overcharging the public seldom has This applies particularly where there any foundation in practice. is also easy access into the bus business and an element of competition. In Nairobi, Kenya, for example, fares are not controlled and there are few restrictions on obtaining a license at $0.02 per kilometers, Fares, to operate a matatu (minibus). are amongst the lowest in the world for this type of bus. In Nigerian cities such as Enugu and Onitsha, where bus operators charge a comparable low similar conditions prevail, ~ flat fare of $0.07 - 0.10 per trip.

I ,

The benefits of deregulation of bus services are well Private bus operators select illustrated in Colombo, Sri Lanka. and determine hours of set their own fares, their own routes, operation. sector in Colombo has benefited The private transport greatly from the liberalization of national economic policies in the easing of import restrictions and tax First, the late 1970s. Then, in 1979, incentives stimulated purchases of new vehicles. the government put an end to the Central Transport Board s (CTB) monopoly on public transport services. These actions evoked a strong response from private bus who imported more than 6,000 buses between 1979 and operators, Some 11,000 private buses now operate throughout Sri Lanka, 1981. The about 3,500 of them in the Colombo metropolitan region. capacity of these private buses ranges from 1%to-60 passengers. CTB operates 5,800 buses in the metropolitan region, Meanwhile, Private each one able to carry between 100 and 120 passengers. bus services have so far managed to capture a high proportion of despite competing with the heavily subsidized and the market, well-established CTB bus services. Although the private bus operators are permitted to set their own fares, the latter are greatly influenced by CTB fares 9 As a which are held artificially low (about $0.015 a kilometer). result, some private operators have found it difficult to compete, while others have resorted to overloading and other malpractices. regulations with regard to safety, Al though stringent exist enforcement i9 seriously vehicle inspection, insurance and a few unprofitable routes have been shunned lacking. In addition, and are served by CTB buses, which have by private operators The government is considering become chronically overloaded. special arrangements to overcome these problems. The overall effect of deregulation has been a substantial increase in capacity, particularly at peak periods, and more CTB s operations and large subsidy are frequent bus service. being reduced as the private sector increases its share of the market.

40

By regulation, throughout applies justified urban longer trips lengthy Fares). preference passengers the city, long

governments regardless and short of of

often distance.

apply

flat In other

fares

to all the fares once

bus trips same fare are the to make shortest

words, flat

to both

journeys. those--

In some cases in particular, of the city

on the basis

assisting

again, have

poor--

who may live But, in order into

on the periphery flat fares it

and thus

journeys. possible trips Apart of

with

pays operators In particular, (Box 11:

to make the they of

to maximize of

returns. the city. of

avoid Regulated the many

the outskirts

Problems

from a consequent operators

low level routes

service

to such areas, the need for

to run short buses

may create to reach their

to take

several

in order

destination.

In many countries, of the political and social However, if

fare

regulation sudden

is

long

established, might of not

and because be services into

climate

deregulation

appropriate. are not account

the provision it is important to:

and expansion that

acceptable take

to be inhibited, the need for fare

such regulation

structures

(a) (b)

move towards be related encourage

full to costs

cost

recovery; standards of of comfort, service; conditions, in etc.) and

(distance, types

different promptly cost

and standards into account

(c)

be revised particular,

to take

changing

and patronage.

BOX 11:

Problems

of

Regulated

Fares

provides an example of the type of Medellin, Colombia, when fares are unduly regulated. In problem that can arise Since fares are Colombia, flat fares apply in all urban areas. it pays operators to operate short routes unrelated to distance, In Medellin, high-density residential and to shun long routes. areas are Located north of the CBD and the industrial areas are located in the south. The road system between these two modes bypasses the CBD and is more than adequate to meet demand. terminate at the halfway point, in the However, most bus services Thus, a large number of commuter trips, highly congested CBD. have to interchange in the CBD. approximately 1 million, During in the CBD at lengthy morning and evening peak periods , conditions

- 41 -

chaotic and are locations extremely the bus interchange As a result, commuters are greatly inconvenienced. If congested. fares were less regulated and based on distance, operators would be inclined to carry passengers from north to south without having Buses could thus avoid the CBD, and operating to interchange. costs would be greatly reduced by improved journey speeds. It might even be possible to provide these more convenient trips at a rational fare policy is adopted, reduced fares. However, until authorities to effect these little can be done by the local improvements. Very serious problems arise where fares are regulated at Delhi In Delhi, the artificially Low Levels. India, Transportation Corporation (DTC) shownrly good indicators of However, performance compared with many other bus corporations. because fares (Less than $0.03 for 5 kilometers in 1984) are held the corporation incurs very substantial losses well below costs, ($90 million in 1984). it suffers continuous financial difficulties Consequently, particular, is unable to raise funds for expansion demands. As a result, buses have become overloaded, generally have deteriorated and the corporation, which performs well, faces severe public criticism. and, in to meet standards otherwise

Nigeria, not only are fares held artificially In Lagos, Low but costs are pushed up by regulations that restrict the importation of spares and cheap buses. (This is done to protect the country s vehicle assembly industry: the price of locally produced buses is roughly twice the price of similar imported the fare consequence, buses). As a operators circumvent regulations either by shortening routes or by dividing routes into two stages and applying full fare to each. Worse still, because operators are unable to afford spares and replacement buses, the on the other hand, is bus fleets are rapidly declining. Demand, Because of short routes and insufficient greatly increasing. the 5 million daily bus passengers have to buses, many of interchange several times in crowded conditions, which are made all the more chaotic by a Lack of basic interchange facilities. Since, in effect, most passengers are paying well above the Legal fare, fares could be rationalized without undue public reaction. If this were to be coupled with relaxed restrictions on the purchase of spares and buses, service could be greatly improved without additional cost to the users.

To avoid source should


.

fare

increases conflict with

from becoming with the public,

major

political

issues

and a

of not

widespread be applied

rigid

uniformity

fare structures, if !i to the,_-state or nation

regulated, as a

- 42 -

whole. large

In particular, and widespread

serious fare

public

opposition

is

almost after

inevitable years of

when

increases

become necessary

stagnation.

Some city reduced the chances cost

authorities of

(in

Montevideo, over fare

Uruguay, increases fare easier greatly

for

example)

have to a of

controversy

by linking

fares

bus operating routine. and,

index

and by making small makes it increases,


.

adjustments to justify improves

as a matter fare

The use of with

such an index regular

increases of

together public

small,

the chances

gaining

acceptance.

Levels

of

Service. there

Provided is little of

entry

to the market

and fares

are levels

free of

from undue regulation, service-routes, expensive inhibits usually that is,

to be gained operation,

by regulating allocation of is

frequency, of vehicles. especially of

hours

buses difficult

to and it

or choice

Furthermore, in terms of

such regulation staff resources.

to enforce, the benefits displayed

In addition, judgement

competition
1

and the

sound commercial

by operators.

On the other required neglected overcome competitive operators benefits in Chapter

hand,

there

may be a need or development [in sector

to provide objectives, 21, this routes

services but which can best through

that are be

are

to meet certain by operators. by contracting bidding. themselves of allowing 3.

social

As discussed the private Alternatively, may provide freedom

Chapter

to provide

encouraging a solution

informal

regulation [in Chapter with

by 41. The

as discussed of vehicles is

in the choice

dealt

at length

Responsibilities

of

Government

There intervention themselves governments viable

are

certain

features

of

bus operations left

that

call

for

government

or regulation to control. can take of to

and cannot,be In addition, improve there

to market

forces

or to operators that financially

ar.e a number of of bus services

measures being

the chances the needs of

and capable

meeting

the public.

- 43 -

Safety. safely through and that a system

There danger of

is

a need to ensure road users

that is

bus passengers This

are

carried

to other

avoided.

can be achieved

driver

licensing

and testing.

Both initial should vehicles recognize standards be required they that are

and periodic to attain

testing

needs

to be undertaken, to the size

and drivers of

standards

appropriate

and type

to be permitted of large,

to drive. high-capacity for

Satisfactory buses will

licensing need higher drivers. and access to avoid

systems driving if

drivers

and more experience of services is

than, not

example,

minibus

However, to the excessive

the provision market not

to be unduly then permit. it

inhibited is

unintentionally for any category

restricted, of driving

important

standards

Similarly, testing to ensure

vehicles that they with

need are

to be subjected

to initial

and periodic carry the permitted

roadworthy

and can safely margin should unfairly for

number of overloading. should type?

passengers,

an adequate excessive

safety

inevitable and care

Once again, that the

standards do not

be avoided favor

be taken model,

regulations vehicle.

any particular

or make of

Environmental viability a tendency terminals. necessary buses trucks). vehicle for (this and satisfactory for If large high

Impact.

In providing for of

conditions

that there

lead is

to financial likely and at to be

standards,

bus operators, along major

concentrations levels of

buses are

corridors then it

pollution

to be avoided, exhaust

will

be for and

to establish applies

and enforce equally to other

appropriate vehicles,

emission

standards cars

in particular into

private

Such standards specifications

need

to be incorporated at the

regulations

governing are tested created and

and examined and passenger to be taken

same time as vehicles The air in the pollution location

roadworthiness also need

safety. into account

and noise of

by buses depots.

terminals

Traffic likely

Control. the

High concentrations congested traffic

of

buses, that

if

uncontrolled, in most

are

to aggravate

conditions

exist

- 44 -

cities. enforcing of

As discussed traffic

(in

Chapter that

21,

this

can be overcome indiscriminate

by establishing

and

regulations along

avoid

loading It is

and unloading important with the the passengers for

bus passengers of of This

busy routes that

and intersections. such restrictions passengers that are

the viability reservation street.

bus services for should buses

be coupled both

space space

to handle

on and off for

be at locations users*

convenient

but do not

impede other

road

Cooperatives. been described set

The benefits 4.

of

informal

regulation

by operators

have to

in Chapter

Governments associations

can help

by encouraging that the

operators legal

up cooperatives exists for

or route

and by ensuring to be established to coordinate spares

framework effectively. operators training, recognize government

such organizations to have authority

and to function the activities of undertake need to with

They need who wish

to be involved, depots

to purchase and terminals. may represent

and vehicles, also

and to operate that

Regulations operators

the cooperatives authorities.

in their

dealings

and city

The Road Network. availability roads they it is of well

A vital road

element

for

successful Poorly

bus systems

is

the

maintained

networks.

paved

or maintained times. Hence,

add very have

significantly impact city

to bus operating on viability authorities for

costs

and journey of service. are Also,

a direct

and standards ensure that

As a result, paved and

important

that

bus routes

improved needs

to standards

suitable to provide

frequent for

bus movements. buses is state into that of

the network

to be extended areas.

access

new and growing the repair. system of bus

development routes

Of considerable needs to be kept

importance in a good

as a whole

Traffic services, traffic involves pedestrians, ments. Also, there

Management. is a need

To assist

with

the efficient and improve

operation the overall This

of

bus of

to avoid

congestion

flow usually

by providing traffic signs

effective

traffic

management and control. channellized controls, intersections, and minor use of road

and signals, and street

facilities improveroad

for

parking in order

trading

to make the most effective

available

space

- 45 -

there

are

clear

advantages

in introducing private

some form of demand cars.

management--

for

example,

restraints

on the use of

Priority improvements priority way. for

for

Buses.

City

authorities and standards bus only

can make substantial of bus services or exclusive phases by providing rights-oflights in and

to both buses

the viability form of

in the

lanes

Buses may also turning

be given

priority

by special

at traffic

exclusive many cities In,addition operating

movements

at intersections. in bus services to the public, have made it

This being

has been speeded

undertaken

and has resulted to improving cost and,

up considerably. have reduced fares.

service

these

measures

in some cases,

possible

to reduce

Terminals operators convenient lack of in a city network suitable

and Depots. may have of routes

Whiie significant for their

the existence benefits, passengers

of the is

several provision

different of a by the City and by

often

inhibited facilities.

locations

for

terminals

and interchange sites of for

authorities constructing These are

can assist

by allocating

suitable

this

purpose

or coordinating sometimes provided

the construction on direct individual

the necessary or leased

facilities. of

repayment operators

to associations or daily with

operators. fee,

Alternatively, time they

may pay a monthly Depots, together

or pay each

use the facilities. facilities,

maintenance The collective

and servicing provision overhead

can be made available services may produce

in the

same way. of

of

these not

certain

economies

scale , provided

does

become excessive.

Financing difficulties lack of

Bus Purchases. buses or

Operators

in many countries of import

have and a by

purchasing foreign suitable exchange

and spares

because

restrictions can help for

financing services

facilities. designed

Governments to make it for easier

providing

banking

legitimate of buses

bus operators and spares. the relaxation countries availability

to obtain The use of of import Sri

loans special

and foreign funds

exchange

the purchase commercial

disbursed

through

banks and

restrictions

and exchange

regulations

in several on the

(Mexico, of

Lanka, and the

and others) standard of

has had a marked effect services.

buses

- 46 -

BOX 12:

Government

Facilities

to Assist

Bus Operations

In Brazil, considerable improvements in bus operations have been achieved in five metropolitan areas (Salvador do Bahia, Physical Curitiba, Recife, Belo Horizonte, and Porto Alegre). the measures included the introduction of exclusive bus lanes, and the paving of bus routes in construction of bus terminals, These improvements have achieved significant low-income areas. which in Curitiba and Recife have been passed on to cost savings, passengers in the form of fare reductions. The exclusive busways provided in Porto Alegre have met the demand for high passenger flows in the central business The right-of-way has been made exclusive by way of district. markers, and a bus convoy system has been curbs or low, reflecting of a corridor buses introduced. In this system, at the beginning are coordinated in a fixed sequence according to route, forming which may belong to The buses, convoys of up to six buses. different companies, travel together, stop simultaneously, board The combined and depart in a queue or convoy. their passengers, use of the bus expressway and bus convoys has achieved peak-hour, one-way passenger flows of 28,000 passengers on 260 buses, at a in the most heavily traveled speed of 19 kilometers per hour, two transfer terminals were built, corridor. On one expressway, to transfer between the smaller buses permitting passengers articulated buses serving the serving feeder lines and larger, This transfer arrangement has resulted in 20 bus-expressway. percent higher bus speeds and corresponding fuel savings. The government of comprehensive approach to It consists of: Abid jan. the Cote improving d Ivoire has transport the adopted system a in

various traffic improvements, including the creation the installation of integrated of one-way streets, and road markings in the signs, traffic signals, the extension of business district, and central traffic management programs throughout the city; measures to improve the movements of pedestrians and buses in high-density, low-income communities; including the improvement of pedestrian facilities, construction of footbridges; the construction of a bus-way and reserved bus lanes in the central business district; a high-speed express bus network, made possible by the construction of new road links; of bus terminals and bus stops and the upgrading construction of a bus depot; the construction of primary roads to improve public transport access to low-income areas.

- 47 -

of the city s road Before the project began, key sections lasted network were seriously overloaded , and downtown congestion Considerable all round for as much as twelve hours each day. The running improvement has occurred as a result of the project. times for buses crossing the central business district have been halved, and the elimination of congestion caused by the loading These and unloading of buses has benefited other traffic. improvements have been achieved even though rush-hour traffic has increased by roughly 20 to 30 percent. By far the majority of bus services in Mexico City are run by private operators who are ready to expand and improve their However, many have been held back fleets to meet growing demands by the high cost and lack of c oice of new buses available. Also, i; they have faced difficulties in raising sufficient capital to To overcome this situation, the states of purchase new buses. of the World Bank, have Mexico and Nuevo Leon, with the assistance established a line of credit for financing the purchase of buses by private operators. Loans are administrered by BANOBRAS (National Bank of Public Works and Services) and are at interest rates close to the average cost of lending in Mexico. Import restrictions have been relaxed to encourage competition in the At the same time, bids are for small batches supply of new buses. of of vehicles based on buses, providing a wide choice specifications agreed upon by the private operators themselves.

Taken together, governments bus services. most cases, on to users

the

infrastructure significant

and facilities impact

provided

by of

can have a very (Box 12:

on the quality

and viability In

Government savings reduced

Facilities in operating fares.

to Assist costs

Bus Operations)

considerable in the

can be achieved

and passed

form of

- 48 -

CHAPTER6

PERFORMANCE EVALUATIONAND STANDARDS OF SERVICE

In most cities very of are heavy demand, steep

in developing rises is in both a pressing are

countries, capital need

bus services and operating

are costs,

faced

with

and a lack resources use

resources. available

Thus there for

to ensure

that

whatever

bus services

put to the most effective

and efficient

possible.

For this performance public. of

purpose

there

is

a need

to evaluate of service

the operational being provided to the

bus services

and the

standard

This

can be undertaken

by the use of

certain

performance

indicators.

The key performance this technical paper are

indicators

and quality

standards

suggested

in of to
bus

designed

to highlight

quickly

any deficiencies in order

services effect

and to indicate early improvements. indicators of

where attention

can best of

be directed

Used as a system detect for changes

monthly

monitoring, trends

these an

performance early warning

will

in operating

and provide

the need

remedial

action.

The particular assist they in providing are based

indicators

suggested of

have been

chosen

because

(a)

they

a basic that

assessment are likely field

bus operators

performance,

and (b) not

on data for

to be readily surveys.

available

and should

involve

the need

extensive

A more comprehensive however, desire and may prove to evaluate covering

range

of

performance value

indicators where there

does is

exist, a need or A detailed uses, is by

to be of

considerable

or monitor a wide

bus services of

in much greater measures of

depth. and their

discussion contained

variety Transport:

performance Evaluation

in Urban Public for

Performance

published

the Organization

Economic

Cooperation

and Development

(OECD) in 1980.

A summary of
.

the

performance

indicators

suggested,

together

with

the

range is

of

values

likely

to be applicable Attachment).

to a reasonably

well-run

bus company,

presented

in Annex I (see

49 -

Key Operating

Performance

Indicators

Passenger passengers terms of reasonably range:

Volumes. carried the average

A significant in relation number of

indicator

of

productivity of the system.

is

the number of Measured a in

to the capacity passengers

per operating produce

bus per day, in the

well-managed

bus company should

results

following

Type of

Bus

Crush Capacity

Passengers per Bus per Day 1,000 1,200 1,500 2,000 1,200 1,500 1,800

Single-deck Single-deck Single-

bus bus bus buses

80 100 120 160

or double-deck

Articulated

or double-deck

- 2,400

Several that achieve high

factors

will

have a direct

bearing

on these below,

results. carry

Systems more

vehicle-kilometers, figures that unable for

as discussed passengers

usually tend of

passengers. with trips. expected of the the rapid

Similarly, turnover is

per bus will proportion demand, or even

to be high passenger can be top end

results

from a high with heavy

short

Where supply

to cope

overloading exceed the in

and passengers scale. Therefore,

per bus will this

tend

towards should

indicator

not

be considered

isolation.

Fairly buses Addis 2,500 average Ababa,

typical 1,135

is

the Karachi per day. buses

public

corporation, examples

where are

operational by

passengers

Extreme facing

provided

where high-capacity each per day,

heavy

demand average buses

nearly carry only

passengers

and Paris,

where underutilized

715 passenger

per day.

Fleet each

Utilization. day has a direct of

The proportion bearing

of

a bus fleet

that of

can be put system.

into It is

service

on the productivity of bus maintenance, recruitment of total

the spares

indicative and stock utilization, by dividing

the effectiveness as well

and procurement, Fleet calculated by

keeping

as staff

and management. fleet, is usually

expressed total buses

as a percentage running during

the morning

or evening

peak period

50 -

the

total

fleet

size

(excluding and staff between because of

any buses management, 80-90 percent. of

that it

are should

beyond

repair).

With to achieve

adequate fleet short

maintenance of range the

be possible

utilization of this over

Fleet

utilization facilities

may fall or skills, there

well

of

a lack

maintenance tires,

problems labor

supply

spare

parts,

or fuel,

or where

are

or union (fleet

problems. utilization high

Such problems 24 percent)

can be seen and Calcutta

in the public (64 percent).

corporations On the by by

in Accra, other private hand,

very

utilization

can be achieved,

for

example, are

95 percent out

operators

in Seoul, skilled

when repairs mechanics

and maintenance working on buses

carried

adequately off-peak

equipped, periods.

overnight

or during

Vehicle is the

- kilometers. total distance This is

A further traveled usually

indication by buses

of

the productivity i.e., average provide are not vehicle-

of

a bus fleet

in service, in terms of of operation

kilometers. operating but details available.) sources,

expressed

kilometers another readily

per measure,

bus per day. of operating

(Vehicle-hours hours for each

bus usually

Vehicle-distance such as tackometer

can be measured readings, route

and verified

from a number of and fuel

distances

and trips,

consumption.

For a reasonably day should be in the region

run bus service of 210-to-260. and road

the average The results,

kilometers however, of

per bus per will be

greatly

influenced

by traffic

conditions, turnaround public

hours time.

operation, Examples buses that in in fall

breakdowns, well outside at

the number of this range

stops,

and the

are

provided

by the

corporation

Calcutta, Seoul

120 kilometers In Calcutta, bus routes are

per bus per day, both poor, traffic

and the private conditions are

bus services along the

at 340.

and road

corporations Seoul,

and staff good

incentives

inadequate.

In

in addition is

to comparatively by highly

traffic

and road

conditions,

productivity

enhanced

motivated

operators.

Breakdowns the
.

in Service. of buses

An indication that break

of

maintenance

and driving and require

standards either A reasonably of no more

is

proportion

down in service or attention to have

assistance well

from a mobile fleet

repair

unit

at

the depot. at a rate

maintained

would

expect

breakdowns

51 -

than 8-to-10 quality of

percent maintenance

of

buses

in operation skills, conditions

each traffic are

day.

In addition

to poor

and driving climatic

congestion, particularly

bad road inclined this to give

conditions, rise

and tropical

to breakdowns of

and need

to be taken

into

account

when assessing

measure

performance.

Fuel engine

Consumption. type,

Fuel

consumption

will

depend

on size

and load encountered

of

vehicles,

and the gradients and driving in terms a well

and traffic will per should

conditions

on route. as

Maintenance well.

standards of liters

have a considerable 100 vehicle fall within

influence fuel

Measured of

kilometers, the following

consumption

run system

Limits:

Minibuses: Regular buses:

20:to-25 25-to-50

Liters liters

per per

100 kilometers 100 kilometers

Typical buses seat traffic carrying minibuses, conditions

results up to

are

found

in Khartoum, is 44 liters per

where per

the

fuel

consumption

of

100 passengers is

100 kilometers.

For 20-

consumption

27 Liters and the

100 kilometers. is generally

In Khartoum, flat.

are moderate

terrain

Staff service

Ratios. provides

The size a clear should

of

the

staff

employed of

to put buses of

into

regular The

indication be expected:

the efficiency

bus services.

following

ranges

total

staff

employed staff staff

per operating employed

bus bus

3 0.3 0.5

-8 - 0.4 1.5

administrative maintenance

per operating

In practice, (and from one operator on the

results

vary

considerably A number of Staff ratios

from one country factors toward are may have the top of

to another a strong the range are to

to another). ratios. where for

influence

staffing in countries

can be expected Likely

Labor costs example,

Low and operations as opposed

to be labor cleaning staffing labor

intensive; will ratios,

manual cleaning Labor

mechanical
.

increase

the amount of of

employed.

Excessively (201, and make

high occur

total where

as in the case regulations

Cairo

(18)

and Calcutta

Laws or union

inflate

the bus operation

- 52 -

it

difficult

to relate it may not

manning

scales

to the size staff staff

of

the operation. are found

In

particular, curtailed.

be possible hand, very

to reduce low total

when services figures are

On the other

in where as outside in staff of

small , privately owner-drivers driving

owned operations, undertake maintenance

such as those

in Kuala Lumpur (3) tasks, as well use of

and administrative

at least for

one shift. tasks

Some operators

make considerable which may not may give

contractors numbers. efficiency.

such as maintenance, low staff ratio

be reflected

Thus the resulting

a false

impression

Accidents. standard conditions, therefore in the of

The level driving

of

accidents

will

provide

some indication be greatly

of

the by traffic should operating

and maintenance, the volume the traffic

but will of

influenced

in particular be made with

pedestrians. rate for

A comparison other vehicles

accident

same area. accidents 1.5 to 3.

In a well-run per 100,000

bus company operating bus kilometers are

under moderate likely to be in the

conditions, region of

Dead Mileage. applied words, not to the journeys

Dead mileage length that of

(sometimes that

called are not

light

mileage) earning.

is

the

term

journeys

revenue

In other are

are made when buses This usually depends to the

are not

in service of

and passengers overnight points would of

being

carried.

on the location start efficient and finish system

parking the bus

and maintenance services. region of

depots

in relation for

Dead mileage 0.6 to 1.0

a reasonably of total

be in the

percent

vehicle

mileage.

Cost labor

of

Bus Services. costs,

The costs but are

of

bus services influenced and road

are mainly

dependent of

on local

and fuel

greatly

by the efficiency conditions. and interest) USc2 - 5 per appreciable

operation of

and management and by traffic (operating lanes should costs,

The total in mixed passengerinfrastructure

cost traffic

bus services

depreciation, of

and bus-only kilometer, costs,

be in the region busways,

and in segregated

involving

USC5 - 8 per passenger-kilometer.

The lower bus services,

end of

these

scales

are

likely

to apply

to owner-operated Significantly lower

and the

upper

end to public

corporations.

- 53 -

costs

have been recorded, the results in the

and although often of are

they may indicate

highly

efficient or other with Nairobi s

operations, deficiencies minibuses,

due to excessive (the buses). case,

overloading for example,

supply

services

and Bombay s

corporation

Operating subsidies, investment revenue region

Ratio. revenue

In order should

to be self cover costs

sufficient

and avoid

the need

for

and show a small requirements, including

surplus

to stimulate ratio (total

and growth.

To meet these costs,

the operating should

divided of

by operating

depreciation)

be in the

l.OS:l-to-1.08:1.

Quality

of

Service

Indicators

Acceptable country placed to another, on time,

levels and will

of

service be greatly

will

differ

very

considerably levels; of

from one the value

influenced conditions, public of

by income availability attitudes that

geographic traditional Clearly

and climatic standards,

alternative characteristics. universally Nevertheless, be measured. provide with

modes,

and ethnic could be city. that to these will can

there

is no set of

standards

applied there Values

to the quality are a number of

bus services that

in any particular services possess authorities Using factors

attributes on these service the

have of

been placed of for

by various in their of

indications

the quality due regard of

cities. other

caution

and having measure

influence of

provide

a rough

comparative

levels

service.

Waiting

Time. have

A major to wait

factor

in the overall for

quality This

of is

service often

is

the

time to be

passengers the the primary findings

at bus stops service establishes

buses. perceived

judged

indicator of

of

quality

by passengers. levels of quality

In Caracas, for

a study

the following

waiting

time: 3 minutes 411 minutes 12 - 19 minutes over 20 minutes


O-

good regular bad very bad for that acceptable is, if waiting time are has been to board

London Transport expressed in terms of

criteria

frequency;

passengers

unable

- 54 -

the first without time of waiting minutes). Unit to-20 of

bus to arrive, fail about .

they

should

be able services incidentally often

to board this

the

following

bus waiting

For high-frequency four minutes (which,

represents rarely is is

an average achieved; of

average 5 to 8

time for

high-frequency of

services of

in the region in Delhi,

As part Transport

an examination

bus services

the Overseas that LS-

and Road Research be the reasonable on a number of clearly

Laboratory

(TRRL) has concluded time waiting for bus

minutes

might However,

maximum waiting routes, average of

passengers. minutes

time was above Taking it is

20

and passengers

were deprived
factors Level

adequate that service

service. may prevail, in developing of

into

consideration suggested countries with would upper that

the different to achieve

and conditions of

a reasonable time

the average

waiting of short

should minutes. with

be in the

region

5-to-10 these

minutes, ranges

a maximum waiting apply Limit to fairly would apply

lo-to-20 journeys

The lower high-frequency

end of

services services.

and the

to long

journeys

and Low-frequency

Walking

Distance

to Bus Stops. are indications

The distance of

that

passengers provided

have

to walk to

and from bus stops Generally, find

the coverage

by bus services. should expect to

in reasonably within of

well-served 300-to-500 500 meters

urban areas , passengers meters of their

a bus stop

home or work place. in Low-density areas, but

Distances

in excess

may be.acceptabLe have

the maximum distance should caused of not exceed

that 1,000

passengers

to walk to and from a bus stop on the other one hand the delays hand, the inconvenience routes in dense

meters. spaced stops

(Considering and, on the of of

by too

closely stops,

widely areas

spaced is

the optimum spacing to be in the region

bus stops

along meters.)

urban

Likely

300-to-400

Interchanges other modes)

Between adds

Routes

and Services. spent waiting

The need and to

to change the

buses

(or

to

to the

time It

inconvenience direct cost, the journeys to of to . e.g.,

experienced when a second majority of

by passengers. fare is Levied. should

may also

add to passengers transport during

In a well-designed not need to interchange

system their

commuters

or from work. once


.

In a Large

city

many commuters but Less

might than

be expected 10 percent

interchange

(e.g.

travel

on two bus routes) to interchange

passengers

should

be required

more than once.

- 55 -

Journey three

Times. hours each

Passengers

should

not

be expected

to spend more than walking times). or poor

two-toto and

day travelling waiting time,

to and from work (including interchanging, of and bus trip bus supply

from bus stops, journey times

Excessive scheduling and

may be a reflection But other into external account

inadequate

and routing. need

factors.may

have a much greater the performance residential areas in Mexico of

influence bus

to be taken

when assessing of

services. and poor conditions each

In particular, traffic prevail, and road a third

the remoteness conditions. of all

to work places City where these hours

For example, commuters

spend between

two and four

day travelling

to or from work.

Considering will depend on the taking

only journey into

the bus element speed account

of

the

journey, of

the

journey (i.e.,

time the

or commercial running

speed

the buses in traffic,

average stopping mixed

speed

speeds,

delays or alight).

and areas (kph) journey in

on route this

to enable should

passengers

to board

In dense
.

traffic,

be a minimum of kph.

lo-to-12

kilometers

per hour areas,

and in bus-only speeds of

Lanes,

15-to-18

In medium- to low-density be expected.

approximately

25 kph should

In Tunis, 19 kph for the urban drop short area of

the

journey

speeds

for

buses

are

14 kph for long suburban

urban

services, In

suburban Bogota,

services,

and 30 kph for speeds section are for of buses

services, kph but District. speeds

l ourney J
busy conditions

average

25-to-30 Business

to seven

kph for traffic

a short

the Central

In Cairo, vary

where

particularly

bad bus journey

can

between

three

and 13 kph.

Different periods.

journey

speeds j ourney

can be expected speeds

in the peak and off-peak recorded at 15 kph during results efficiency

In Kuala Lumpur,

have been

the peak period will of be dependent

and 25 kph in the off-peak. more on traffic and road

Once again, conditions

the actual

than on the

the bus service.

Travel

Expenditure. groups,

Travel

expenditure

probably criterion

is

perceived, in their

particularly choice of is

by

low-income
,

as the most important to walk. on the

mode and

may Lead many to choose affordable is dependent

The extent income Level

to which of

a bus service

the users.

In developing

- 56 -

countries, not exceed

a reasonable

Level

of

household income.

expenditure Groups with

on bus travel comparatively of their that

should high

10 percent income

of household to spend

disposable travel, the use without in of cars

may elect
for cars and in

a larger service, In industrial of at 3-to-5 the

proportion in

incomes provided

on by

return private

a higher

quality

particular countries,

taxis. region

households their studies income have of on found their

may spend In developing very

the

percent

of

commuting. that certain

countries, groups

other

extreme, of

Low-income (Nairobi, are

may spend while (e.g.,

in excess Levels Kingston, of

30 percent

income region etc.).

on travel of

Sao Paula), not unconxson

expenditures Jamaica,

in the

15 percent

Calcutta,

Despite the the (e.g. of the

the

very

serious are

difficulties able

facing

bus and in

operators some cases technical

throughout exceed, paper I

world,
Levels

there
of

are many that


and
Buenos Aires,

to achieve, suggested Seoul). service the rise services in

performance

standards Coimbatore, of

this

Hong Kong,

Certainly, should

the Lower ends by most are demand

ranges
well

indicated
run bus

for standard8
services as and need

be achievable that the public

reasonable entitled for better

and are incomes if bus

very Least
there are will

to expect. quality standards

However, transport will

be a growing their

to retain

passengers,

to be improved.

Experience to city, able viable. to generally, satisfy the

shows given

that the

although incentive of the

conditions
and a degree

vary of

considerably freedom,

from city operators are

expectations

public

and

continue

to be financially

- 57 -

ANNEX! BUS SERVICES: EVALUATION AND IMPROVEMENT STUDY

Draft

Terms

of

Referen;ce

[Note: company owned services

These

draft

terms They and can can

of

reference

have

been

written publicly

with owned and

a single

bus

in mind.

be applied be adapted

to either

or privately of

undertakings provided

for the evaluation


such as

improvement or route

by a group of

operators

a cooperative

association.]

Background

[Here

insert

a brief area, data.

description split of details

of

the

city, trips, the


bus

providing vehicle company might Losses,

details fleet,

of and

its other basic together service any

population, transport with

modal Give of the

person of

brief

to be examined include etc. poor List

an outline

principal maintenance,

problems. heavy to

These financial this study.]

provision, earlier

inadequate studies that

may be relevant

Study

Objectives

The main

objective

of

this

study

is

to:

58 -

improve

the viability

and quality

of

services

provided

by the

bus company.

This

objective

will

be achieved

by the

following

means:

assess

the approximate services.

current

and future

demand for

the

company s determine

the operational,.financial, causes. need

and service

deficiences

of

the bus company and their identify current the measures deficiencies that

to be taken with future of assists that need

to overcome demand,

the regard

and to cope quality,

with

to the quantity, present to reach should

and variety

services. company authorities to be taken. steps feasibility This

the findings decisions include of

in a form that on the measures plan for for

an action reference

immediate

to be taken or design

and terms studies

any subsequent

that

may be necessary.

Scope

Geographic.

The study

should areas [any

cover that

the current

area

served

by the be

bus company and any additional called require upon or wish close to service

the company may, of particular here]

in the

future, may

areas

concern

that

examination

should

be identified

59 -

Technological. suitable are

Bus types

and sizes

that

could

prove

to be viable

and

to be considered.

Institutional. including organization of service

The study

should

consider

any institutional to improved the sector,

changes, viability study should

and management, [in the case

likely of public

to .lead

and standards consider contracting

corporations the private

the opportunities out services,

for

participation etc.]

of

such as

maintenance,

Problems

to Be Addressed

Existing known deficiencies leakage, excessive The final problems

bus services and possible excessive of buses,

are

suffering for time,

from

[insert high

here costs,

details revenue due to

of

causes; travel street

example,

overcrowding, labor, report lack

low productivity lack of

conditions,

incentives, will address

etc.] these

must demonstrate

how the measures

proposed

in a cost-effective

fashion.

Available

Data Sources

Wherever and past of surveys data,

possible, of the if

the

study

should

be based

on available

statistics The gathering

bus service

and travel be kept

characteristics. to a minimum.

new field

necessary,

should

-600

Study Approach

Since the study improve the viability available data,

requires

only

the identification it should

of measures rely

to

and standard

of services,

on readily

experience

, and simplified

evaluation

methods.

[In the case should areas. be selective

of a large

undertaking,

the level

of service

evaluation routes
and

and concentrate of all routes

on a number of representative and the rervice area

An examination

as a whole may not

be necessary.] Study Methodology

General structure force, its

Description,

of the Company. the rire

Provide of its

details

of the type and and labor and

of ownership organizational

of the company,
structure,

operations, patronage,

area of

operation,

objectives.

Operational description should

Environment.

The study

should

include

a brief This

of the conditions

under which the bur company operates.

include:

the degree fares; choice

of government

control

over access frequencies;

to the market; schedules; and and import

router;

zones of operation; staff

of vehicles; taxes;

appointments, licenring;

dismissals inspections;

retirement; duties.*

royalties;

61 -

the degree an indication the operation of

of

control of public

or influence and political of the

of

cooperatives attitudes that

and

unions;

may affect

and viability competition from

bus company;*

details systems; the

other,operators :.

and

transport

traffic

conditions points.

along

routes

and at

stops,

terminals,

and

interchange

[items and Action

marked is

* can

be deleted

if

a Bus

Services:

Government

Policy

Study

also

undertaken]

Study current year

Period. should

The study include

should fiveand

be based ten-year

on the

situation

in

the

and

forecasts.

Assessment services travel the and forecast surveys study years should

of

Demand. the not likely

Estimate

the

current and ten

demand for

the

company s Detailed

demand five

years

hence. demand passenger in

be undertaken.

Instead,

future current urban of

each flows

of

should growth

be estimated factors and, if such

by projecting
as projected

based level timand.

on simple of

population past trends and


for

growth, in transport for around

motorization, Allowance

available,

details unsatisfied

should

be made for

demand

demand in and

the company s the company s are to be used,

services service the

likely area. validity

to be generated If of projections the data

by, new development available from previous

studies

should

be checked..

-. 62 -

The study and the likely

should

take

into

account of

projected

changes

in income

levels

demand for

services

different

standards.

Operational bus company using volumes, fleet

Performance. appropriate

Evaluate

the operating measures,

performance

of

the

key performance vehicle-kilometers, accident rates, usually

such as passenger in service, These fuel should be

utilization, staff ratios, a range of

breakdowns and dead mileage. expected

consumption, measured

against

values

from a reasonably should

well-run

bus company (see in order

Attachment).

Any deficiencies

identified

be examined

to determine

the causes.

Financial company as a whole. which total costs costs) services, should

Performance. In particular, (capital are costs,

Evaluate the

the study

financial should

performance examine the

of

the bus to as The

extent

interest,

and depreciation, or other-sources of

as well revenue.

operating cost ratio, of

recovered of with

from users cost

in terms

per passenger-kilometer expected

and revenue-cost well-run

be compared

the results

from a reasonably should

bus company (see in order

Attachment). the

Any deficiencies

identified

be examined

to determine

causes.

Standard the public distance passenger These using

of

Service.

Evaluate

the

standard

of

service time, routes

provided walking and services,

to

key measures, the need

such as passenger to interchange travel of

waiting between

to bus stops, journey times,

and passenger against

expenditure values usually

and affordability. accepted as a

should

be measured level should

a range public

reasonable identified

of .service

to the

(see

Attachment).

Any deficiencies

be examined

in order

to determine

the causes.

- 63 -

Measures that

to Effect

Improvements. to overcome the evaluation

The study significant of

should

set

out

the and

steps

need to be taken identified

in order during

deficiencies

weaknesses

the bus company.

Recommendations appropriate:

for

improvements

should

cover

the

following

areas,

as

Organization accountability personnel

size of

and structure: managers training,

including

responsibility

and

management: discipline

hire

and fire

procedures,

pay

and benefits, routes

and incentives quantity, terminals, priority variety interchange measures facilities

and services: facilities:

quality, stops,

passenger

bus facilities: choice

depots,

parking,

and numbers of vehicles of vehicles, spares, and materials

procurement maintenance fares, fare

procedures collection, and accounting policy, and security systems; regulation cost control, and control, if route costing

information role of

government: [this policy

facilities, study

and assistance of government

item should is

be excluded

a separate

to be undertaken]

Where recommendations of it cost would should be provided.

involve However,

additional detailed feasibility

resources, costing is not

some indication necessary since

be covered

in any subsequent

or design

study.

- 64 -

Schedule

and Reporting

An interim of the instructions deficiencies and of of

report

in with

copies the study.

will

be submitted

within will and outline

weeks

to proceed identified the standards

The interim of

report

by the of

evaluation

operational provide

financial

performance indication standards

service to improve

and will the bus

a preliminary
viability and

possible service.

measures

company s

A draft weeks of will present

final

report

will

be submitted

in

copies

within final the report bus the

instructions of

to proceed the study, of

with the study. reconrnendations

The draft
to

the findings

improve upon

company s findings

viability are based.

and standards

service,

and the data

which

The draft steps study of to be taken or design

final

report

will

also

contain for

an action

plan

for

imnediate

and draft that

terms of

reference

a subsequent for the

feasibility implementation

study

may be considered

necessary

any of

the recommendations.

The final of receiving

report

in comments

copies on the

will draft

be submitted final report.

within

weeks

the client s

- 65 -

Staffing

It professional team that be provided

is

envisaged It

that will

this

study

will

require

about

man-months to mobilize Expertise should a

of

work.

be the consultant s of

responsibility the study.

can do justice

to the requirements subjects:

on the following

public

transport

planning and management and servicing and costing

bus operations bus maintenance financial

analysis

Government

Responsibilities

The government available sources: data relevant

undertakes to this

to give

the consultants will include

access the

to all data

study.

This

following

[here reports,

insert

a description series,

of

the data etc.]

sources,

including

statistical

The government drafting study the help, quickly

will

also

provide

office

space,

secretarial

and the to

transportation and efficiently.

, and office Moreover, to provide

equipment it will

necessary assign

to conduct

study

on a fulltime basis departments.

Liaison

between

the

consultants

and

various

government

- 66 -

Other

Sections

[Include

here

standard

clauses

on:

Method of Reference Exclusion the study

payment to a standard of agents of form of agreement of transit equipment from

manufacturers

Procedures of

for

immigration, tax liabilities, settlement of

work permits, etc. disputes.]

housing,

importation

equipment, for

Procedure

- 67 -

Attachment.

Performance

Evaluation

and Standards

of

Service

(for

explanations

see Chapter

6)

(A)

Operational

Performance

Indicators

1.

Passenger Average

Volumes number of passengers per operating bus per day Passengers per Bus per Day
l,OOO-1,200

Type of

Bus

Crush Capacity
80

Single-deck Single-deck or double-deck SingleArticulated or doubledeck 2. Fleet Utilization Buses in service as a percentage 3, Distance Traveled

100 120 160

1,200-1,500 l,SOO-1,800 2,000-2,400

during the peak, of the total fleet:

80-90

by Buses per bus per day: 210-260

Average 4.

kilometers in Service of

Breakdowns

As a percentage 5. Fuel Consumption Liters per

buses

in operation:

8-10

100 kilometers

Minibuses Buses

20-25
25-50

6.

Staff

Ratios Staff per operating bus: Total staff Administrative Maintenance staff Rate per 100,000 bus kilometers: 1.5-3

3-8 0.3-0.4

0.5-1.5

7.

Accident

Accidents

- 68 -

8.

Dead Mileage Percentage earning length of revenue: bus journeys not

0.6-1.0

9.

Cost

of

Bus Services

Total cost (operating cost, depreciation and interest) per passenger - kilometer Mixed traffic: Segregated busways: 10. Operating Ratio

LJsc2-s S-8

Total revenue divided by operating including depreciation costs,

l.OS:l-1.08:1

(B) 1. Waiting Time

Quality

of

Service

Indicators

Passenger

waiting

time

at

bus

stops S-10 lo-20 minutes minutes

Average
Maximum 2. Walking Distance to Bus Stops

Dense urban Low-density 3. Interchanges

areas
urban areas Routes and Services

300-500 m
500-1000 m

between

The number of times a passenger has to change buses or other modes on a journey to or from work: Average Maximum (less than 10% of commuters) 4. Journey Times from work:

o-1 2

Hours traveling each day to and Average Maximum Journey speeds of buses: Dense areas in mixed traffic Bus-only lanes Low-density areas
i 5.

1.0-1.5 2-3 lo-12 kph 15-18 kph 23 kph


:

Travel

Expenditure

Household expenditure on travel as a percentage of household income

10

69 -

ANNEX 11 BUS SERVICES: GOVERNMENT POLICY AND ACTION STUDY Draft Terms of Reference

[These is

terms

of that of

reference the city

were written
government and these traffic terms that as the of is

with

a city

government for the of

in mind, control road and

and

it

assumed

responsible and the

regulation With minor state with

bus

services

upkeep could

the cover is

network. or replace

modification, where state

reference is, where

national

policies and/or

applicable--

@city )

mentioned

and nation

case

may be. 1

Background

[Here, situation. services that

insert

basic current

details government

of

the

city s

current and

urban

transport regarding earlier bus studies

OutLine and any

policies experienced.

functions List any

serious to

problems this study.]

being

may be relevant

Study

Objectives
,

The main government viability, of the policies

objective

of

this that

study will of bus

is lead

to

assist to

with

the

formulation in the the needs

of

and actions and quality

improvements in order to

efficiency, public.

services

meet

70 -

Specifically,

the objectives

of

the study

are

to:

review

the existing of public

role

of

government

in the

provision and assess

and its

regulation influence identify their identify

and private

bus services of

on the viability the role of unions

and standard or transport provision; be taken of

bus services; and assess

associations

influence the

on service steps that

should

by government bus services;

in order

to improve present

the viability

and standard

the findings

and recommendations to reach This should for

in a form that

assists

the government that plan design need

authorities

decisions include

on the measures a short-term feasibility action or

to be taken. of

and terms studies

references

any subsequent

that

may be needed.

Scope

The study services provided

should by both

cover

government

policy

and actions sector,

regarding

bus

the public

and private

including

paratransit

and informal

bus services.

- 71 -

Problems

to Be Addressed

Existing difficulties inadequate services, activity,

bus services

are

suffering for example,

from

[insert losses,

details high

of

known

and possible quantity etc.

causes; of

heavy Lack of

costs,

and quality for

services, Lack of etc.]

investment

in bus union

due to;

example, exchange,

competition The final

and incentives, report

Lack of

foreign

must demonstrate these problems.

how the recommended measures


.

and action

plan

would

address

Available

Data Sources

Wherever and past gathering surveys

possible, of

the study

should

be based

on available

statistics The

bus services data, if

and travel requested,

characteristics is to be kept

in the city. to a minimum.

of new field

Study Approach

The study cover Since the the

should

focus

on government for the

policy regulation of of

and actions of

and should

institutional study requires

arrangements only the

bus services. and actions by ii


t

identification and standard be necessary. and simplified

policy

government field readily

to improve

the viability should not

bus services, should

detailed thus rely on

work and surveys available data,

The study evaluation

experience,

methods.

- 72 -

[In operations, concentrating circumstances,

cases

where

there of

are a large policy

number of should

bus and paratransit be selective, operators. as a whole In these is required.]

the examination on a limited only

impact

number of view of

representative the bus system

a general

Study Methodology

Existing bus services situation. is set out

Situation.

The study

team

will

gather

all of

relevant the existing

data

on

in the city [A suggested

to provide in order list of basic data

an overview that would

be useful

to the

study

in the Attachment].

Future demand for period. levels impact assessed. public

Demand.

The study. services take into

should

DrOVide a broad . over

indication

of

future

transport should

in the city account

a fivechanges

and ten-year in motorization standards. should The be

The study

possible of

and the potential of these

demand for

bus services

different

demands on fleet

expansion,

depots,

and workshops

Financial transport sources. provision

Analysis. after five-

Evaluate

funding

requirements periods

for

public Likely fund

and ten-year

and identify

- 73 -

Policy issues

Issues

and Actions.

The study and actions

should are

focus likely

on the major to lead to an

and consider

the policies of

that

improvement that

in the supply

viable of

and efficient

public

transport

services

can best

meet the needs

the public.

In particular, recommendations for:

the

study

will

examine

the opportunities

and make

improving market, improving regulation, greater

or relaxing fares, Levels

regulations of service,

regarding and choice for

access of

to the

vehicles;

institutional

arrangements of

the planning, transport sector; of

and monitoring involvement of

the public sector

the private

in the provision

bus services; encouraging different groups ; establishing benefit ?f cooperatives the public or route associations that are to the variety fare levels in the nature to cater and quality of services at income

to passengers

in different

as well

as the operators; to ensure traffic adequate control

strengthening safety

regulations

and enforcement standards

and environmental

and proper

measures; improving road maintenance costs and paving bus routes, hence reducing

bus operating

and improving

access;

74 -

providing for buses

effective

traffic

management and control bus only lanes

and priority rights-

in the form of

and exclusive

of-way; allocating interchange establishing obtain spares. loans suitable points sites for bus depots, their terminals, commercial to enable the purchase and operation; to and

and considering banking

suitable

services for

operators of buses

and foreign

exchange

Where recommendations of it cost would should be provided. out

involve However,

significant detailed

resources, costing is not

some indication necessary study. since

be carried

in any subsequent

feasibility

or design

Schedule

and Reporting

An interim weeks of
i

report

in

copies with the

will study.

be submitted The interim

within report will

instructions the impact of of

to proceed current

outline indication

policy for

on bus services government action

and provide to improve

a preliminary the viability il,


i

the opportunities of bus services.

and standards

The draft weeks of will present

final

report

will

be submitted with the

in study.

copies The draft for

within final report policy upon

instructions findings of

to proceed the study,

the

recommendations of bus services,

government

to improve which the

the viability findings are

and standards based.

and the data

- 75 -

The draft steps study of to be taken or design

final

report

will

also

contain for

an action

plan

for

immediate

and draft that

terms of

reference

a subsequent for the

feasibility implementation

study

may be considered

necessary

any of

the recommendations.

The final of receiving

report

in

copies

will

be submitted final report.

within

weeks

the client s

comments on the draft

Staffing

It professional team that be provided

is

envisaged

that

this

study

will

require

about

man-months to mobilize Expertise a

of

work.

It will

be the consultant s of

responsibility the study.

can do justice on the

to the requirements subjects:

should

following

public

transport

planning management, and policy

bus operations, traffic

engineering

Government

Responsibilities

The government available following data data that are

undertakes relevant

to give to this

the consultants study. This will

access include

to all the

sources:

[insert statistical

a description series,

of etc.]

the data

sources,

including

reports,

- 76 -

The government drafting study the help, quickly

will

also

provide

office

space,

secretarial

and the to

transpottation, and efficiently: basis

and office Moreover, to provide

equipment it will

necessary assign

to conduct

study

on a fulltime

liaison

between

the consultants

and

various

government

departments.

Other

Sections

[Include

here

standard

clauses

on:

Method of Reference Exclusion the study

payment to a standard of agents of form of agreement of transit equipment from

manufacturers

Procedures of

for

immigration, tax liabilities, of

work permits, etc. disputes.]

housing,

importation

equipment, for

Procedure

settlement

77 -

Attachment.

Public

Transport

Studies:

Basic

Data

City

Data

(a) (b)

City

population fleet

and area (private cars, motorcycles, buses, paratransit,

Vehicle trucks)

(c) (d)

Modal split Brief level

of

motorized of

trips length, proportion and road paved,

description of traffic

road network,

management and congestion,

maintenance.

Public

Transport

Data

(City services

passenger

transport

only,

excluding

intercity

passenger

and freight

services)

(a)

Brief details

description should

of

operators;

bus and paratransit. rail system

[rail exists]

be included

where an urban of

(b) (c)

Ownership Details crush of

details, each

and details main type of

cooperatives route

and associations. lengths, fleet size,


,

service,

capacity

of

vehicles

and total details of

passengers public

per day. and

(d)

Performance typical

and financial operators:

operators

private

78 -

availability total average total total fleet,

(outshedding excluding

of vehicles

vehicles

as a percentage

of

scrapped

or cannibalized); per day:

kilometers passengers staff

and passengers carried if per day; certain out

per vehicle

(indicate

tasks,

maintenance staff]; schedules;

for

example, operating vehicle capital

are not costs, costs: costs

carried revenues,

by operator s fare

subsidies,

in the case

of

rail

services,

if

existing.

(e)

Brief

description

of

facilities depots, bus routes,

for public

public

transport: priority

terminals,

busways measures,

and shelters, paving of

transport

vehicle

inspections,

and drivers

examination.

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- 81 -

ANNEXIV BRIEF CASE STUDIES OF BUS SERVICES Jakarta, Indonesia

with a population of about 15 The Jakarta metropolitan region, million in 1986, is growing at an annual rate of 4.1 percent. The city with no defined city center; sprawls over a large amount of territory, business and housing development occurs along main roads, and small An estimated 40 percent communities (kampungs) are squeezed in between. of the road network is operating under unacceptably congested conditions. Public transport is provided almost exclusively by bus and who together carried over 4.5 million passengers per minibus operators, The single publicly owned transport company, PPD, utilizes day in 1985. conventional single-decker and double-decker buses; the private sector operates a wide variety of vehicles, including single-deckers, Only one private firm, Mayasari Bakti, is minibuses, and microbuses. licensed to operate single-decker buses. The municipal agency responsible for transportation regulates licensing (which is very simple for operators of small buses), fares, frequencies, and routes, and is Lack of supposed to evaluate whether existing patterns satisfy demand. there is little regulation staff and funds has meant that, in practice, or coordination. PPD owns 77 percent of the large buses in Jakarta; it employs over 16,500 people and carries between l-l.3 million passengers daily. But neither productivity levels, profitability, nor the quality of its service is satisfactory. Otrly about 60 percent of its buses are in (especially the doubleoperation every day, in part because its fleet deckers) is overly sophisticated given the difficult operating conditions and lack of facilities and trained maintenance personnel. Long lines, overcrowding, and unreliable frequency all characterize the PPD bus routes. High operating costs are a particularly serious problem for PPD. The fare system is based on a flat rate, which allows many passengers to travel up to 25 kilometers for less than $0.14, while others must purchase transfers for far shorter trips. Drivers and conductors turn over a predetermined portion of the total revenue coLLected to PPD and divide the rest among themselves. ALthough the it provides an incentive to system has some advantages (for example, maximize fare collection), they are outweighed by its disadvantages: drivers worsen congestion by stopping in unauthorized places to pick up Layover times at terminals are lengthened as drivers wait passengers, and PPD loses a substantial amount of revenue for more passengers, because unions have successfully prevented the company from raising its *In 1986, PPD was only abLe to cover 50 percent of its share of income. full costs and 76 percent of operating costs; it incurred Losses of about $33 million.

- 82 -

As a result of its ongoing losses, PPD has not been able to keep up with the city s growing demand for public transport, and the private sector was serving about 60-65 percent of the market in 1986. The private companies charge the same fares as PPD but are able to make The sector consists of Mayasari Bakti, operating stage buses, a profit. two major minibus owners associations, and a microbus cooperative. Mayasari Bakti operates at half the staffing ratio of PPD, its drivers .collect a daily salary plus a bonus linked to revenue and its fleet has an utilization rate of 76 percent. collection, cost but evidence suggests that the and revenue figures are not available, The major minibus association, PT Metro company is highly profitable. Mini, has an utilization rate of 80 percent and generally covers short It also provides supplemental feeder routes to the larger buses. transport on main routes during peak periods. Although the minibuses owners generally achieve a 4-tocharge the same rate as PPD, successful 5 percent monthly return on their investment. The 2,000 microbuses operating in Jakarta service only feeder lines and secondary routes, and their flexibility and low fares make them popular with the public. Overall, the private transport sector s costs per passenger/ kilometer range between 50-65 percent of PPD s. For larger buses, the private sector s higher fleet utilization and lower staffing ratios have resulted in higher productivity, and its revenue collection system i generally brings a higher proportion of the total fares back to the company, while providing incentives to collect more fares. The flat fare system, meanwhile, works well for micro- and minibuses, whose passengers travel for short distances, but has a negative impact on the profitability of the PPD, which services longer routes.

Ankara,

Turkey

The capital of Turkey has a rapidly growing population transport-(5 percent per annum), 68 percqnt of which uses public jitneys, or privately owned minibuses. chiefly buses and The use of private cars is growing very rapidly, in part due to deficiencies in the public transport system, and is aggravating already serious traffic conditions. The publicly owned bus fleet, under the direction of EGO (a municipal agency that is also responsible for electricity and gas provision), carries about 35 percent of the city s bus riders and has an utilization rate of about 65 percent for-its 900 buses, most of which The age of the fleet results in frequent are more than ten years old. which are a major factor in the relatively low utilization breakdowns, As a result of this and other factors, EGO is experiencing rate. growing deficits and has proven unable to meet growing demand. This led to the introduction of private buses owner-operated buses were allowed to begin operations. grown to 200 by 1986; private buses carry an estimated in 1982, when 30 The number had 13 percent of the

- 83 -

bus riding population and operate on 26 routes. Private bus fleets have Jitneys, on the other hand, a fleet utilization rate of 95 percent. operate on have Long been popular in Ankara; some 1,900 such minibuses carrying 37 percent of all mass transit riders. 39 routes, Private buses and EGO buses charge the same fares, although EGO alone is allowed to offer student discount tickets and monthly passes. This Jitneys, however, are permitted to charge slightly higher fares. makes them Less desireable for Long trips, but their flexibility enables by the Larger buses. Most jitney them to serve route! not covered operations are believed to be profitable , although firm data on costs and operations is not available. A comparison of EGO and private bus operations indicates that private companies serve more passengers per operating bus and can But their operating seat more passengers at normal and peak hours. costs per,passenger and per passenger/kilometer were Less than half of EGO s. ALL bus and minibus services are regulated by the Urban Coordination Committee, which establishes fares, routes, and sets other reguLat?ons. Licensing requirements,

; the

Transport frequency,

The public company has charged that private operators engage in they routinely charge Less than the mandated numerous unfair practices: fare; they wait at bus stops until the bus is full, worsening congestion; they only operate during peak hours on the most profitable routes; and they frequently do not issue tickets, in order to avoid the LO percent tax Levied by the municipal government. These charges are and more stringent enforcement of regulations could only partly valid, go a Long way toward correcting the situation. However, the private buses are to some extent forced into these practices by the advantage provided to EGO through the issuing of student discounts and monthly passes. Since the underlying need in Ankara it might be wise to better public transport, operators the same advantages held by EGO, or since their high them to charge Lower fares, still permit them to operate at a profit. is to provide more and consider permitting private better still, permitting profitability margin would

Cairo,

Egypt

The Largest city in Africa and the Middle East, Cairo s 1986 population of 10.6 million is expected to grow to Lb million by the year The demand for public transport is growing as rapidly as the 2000. city, but while the number of cars, taxis, and commercial vehicles has kept pace with the rapid population growth, the number of public buses has grown only marginally. Subsidized petroleum prices the absence of effective cars, that encourage inefficient use of traffic management and parking

private

a4 -

and poorly maintained roads have contributed regulations, severe and continuous congestion of Cairo s road network, the Greater Cairo region.

toward a especially

in

Cairo s transport system is characterized by a wide variety of The share of vehicles operated by both the public and private sectors. the urban travel market served by formal public transport has declined falling from 73 percent in 1972 to about 41 percent in dramatically, 1983. Aware of the growth in popularity of private transport sources, the Cairo Transport Authority (CTA) introduced a new minibus service in 1986, consisting of 500 20-seater minibuses, designed to provide high quality, comfortable service at premium prices (from three-to-six times The authority expects to sharply increase its normal CTA fares). as a separate unit with profitability with the new buses, which operate their own depot and workshop. Other transport services are provided by school buses, government staff buses (buses provided by government agencies for their Both the school buses and government employees), taxis, and microbuses. since they remain idle during the staff buses operate inefficiently, bulk of the day and operate with a very low mean load factor. Each government agency maintains its town fleet of staff buses with no interagency coordination, creating considerable waste. taxis (mostly microbuses seating The role of taxis and shared about 10 persons) in Cairo s urban transport sector has grown sharply These vehicles fulfill many functions, during the past decade. including intercity trips, limousine service, regular city trips, long The vast majority and local service in suburban areas. distance travel, but are permitted to function because are unlicensed and unregulated, they help meet demand not being met by regular buses, especially at peak They offer quality service in terms of travel time, frequency, times. and convenience and usually operate terminal-to-terminal rather comfort, serving a relatively well-off commuter population at than by route, There are many individual owners and few large private higher fares. Owners hire drivers, who with little concentration. undertakings, usually receive a monthly salary, plus a commission based on fares regulated in theory, There is no conductor. Fares, although collected. For vary considerably, but this seems to be accepted by the public. short routes, fares are slightly higher than the equivalent CTA bus fares, but for long routes they are considerably higher. Productivity levels for the ?shared taxis, or microbuses, is only 3.4 hours per day are spent on On average, well below potential. which includes 1.4 hours of waiting time at route operations, The rest of the time microbus operators are involved in terminals. such as individual taxis, chartered buses, other types of services, Given the severe shortage of transport vehicles goods transport, etc. especially during the afternoon peak, much could be done to in the city, utilize these taxis more productively.

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Nairobi,

Kenya Public transport under franchise, of small buses in Nairobi is provided by a formal bus company Kenya Bus Services (KBS), and by the and minibuses called matatus.
_

operating operators

The bus-matatu competition is producing an efficient service at low fares , good productivity, and no cost to the municipality. However, the public transport supply is still falling short of demand, as evident severe vehicle overloading at peak hours, and a high by long bus queues, proportion of walking trips. About 36 percent of urban travelers ride and another 34 percent drive private KBS buses, 30 percent ride matatus, cars. foreign owned company in which the Nairobi City KBS (a private, Council holds a 25 percent share) operates about 300 buses, carrying an average of,400,000 passengers daily. Its rate of vehicle utilization, is surprisingly high given that the average age of the 87.5 percent, In 1985, the company earned profits of fleet is seven years. approximately $250,000, despite a rather high staffing ratio of 8.2 However, KBS carries heavy debts and as a result has employees per bus. experienced difficulties in obtaining new funds to invest in fleet The company has not significantly expanded expansion and renovation. I its services since 1973. As the demand for public transport hks grown, privately owned matatus with between 12 and 25 seats have stepped in to fill the gap. Some 1,500 such vehicles operate daily in Nairobi. They generally provide services complementary to those offered by KBS; they work feeder while KBS concentrates on main corridors. routes and secondary roads, In 1986, KBS dropped several of its unprofitable routes along secondary roads, Leaving them to the matatus, and found that it experienced a 30 percent increase in ridership as a result, since more of its buses were available to passengers on major routes. Matatus carry some 260,000 passengers daily in Nairobi, and their numbers have increased by 50 percent since 1983. At $0.10 for a 5 kilometer trip their fares are close to KBS fares, and owners usually Like net on a monthly basis about twice the average income in Nairobi. KBS, however, matatu owners face a difficult environment for obtaining The credit to purchase new vehicles or replace those that are aging. average matatu has a working Life of only two or three years, due to severe overloading and working conditions. The existence of matatus has been encouraged by the Nairobi which permits them to compete freely with KBS. Recently City Council, the Council has begun to impose some regulations on matatus, and it now Although the imposition of few requires them to be Licensed. restrictions in the past has helped to meet growing demand for public the city has recognized the need to impose regulations transport, governing safety standards, driver training, enforcement of traffic and insurance coverage, in order to ensure passenger safety regulations, and to avoid undue congestion.

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Montevideo,

Uruguay

Bus service in the capital city of Uruguay, home of over 40 percent of the country s population, is provided entirely by private under regulation by city authorities. The city s road operators, traffic conditions are generally excellent, network is in good repair, The seven private operators provide high quality and volume is light. service, with good route coverage, reasonable fares, and relatively comfortable service. Of the seven private companies providing public transport six are cooperatives of bus owners and one is a cooperative of services, The six bus companies all use standard buses; some trolley bus owners. 1,420 buses were plying 120 different routes in 1986, with an average fleet utilization of 1,345 buses per weekday. One particular bus company, Compania Uruguaya de Transportes Col ectivas (CUTCSA), is by far owning two-thirds of t e bus fleet. the largest operator, t The municipal office responsible for organizing and overseeing bus services in the city sets fares, establishes and allocates routes, and is responsible for traffic management and road approves schedules, construction and maintenance. Each bus is issued a permit, thereby allowing the authorities to control the fleet size of each company. Because of a trend toward reduced bus ridership, no new permits have been issued for several years. The city authorities have created a bus operating cost index and use it to raise fares on a regular basis (about every four Fare hikes are usually small and are timed to coincide with months). general salary increases, in order to avoid social upheaval. The city sells preprinted tickets to the bus companies, which must present a statement of revenues to city authorities at the end of each month. This system also helps the cit$ to decide on fare adjustments. The fare with a flat fare equivalent to $0.20 for regular structure is graduated, passengers and Lower fares for students, the elderly, and workers; 8 percent of riders are in a special category that allows them to ride but bus operators receive no subsidy for the buses free of charge, Very few people pay more than 10 percent of their reduced fares. monthly income on transport. Buses are rarely crowded, even during peak periods. Average commercial speed in the city center ranges between 15 and 20 kilometers per hour, without the use of bus Lanes or other similar measures. The seven companies each operate different routes, with a comprehensive network that provides passengers with almost door-to-door service and little need to interchange. CUTCSA also opera tes luxury buses between the city center and a residential zone for twice the normal fare. With the exception of CUTCSA, the bus companies are organized in which there is no individual ownership of property as cooperatives, and profits are shared equally among members. In CUTCSA, each bus

\!

- 87 -

belongs to an,owner, or group of owners, who are responsible for CUTCSA organizes service operating and maintaining that vehicle. operates the ticketing system, and collects operations and scheduling, It also operates a revenues from operators at the end of each shift. modern maintenance and repair facility, but each owner is free to make his own arrangements for maintenance.

CUTCSA allocates revenues to members on the basis of the number bonuses are awarded or penalties applied of hours of vehicle operation; by comparing the actual revenue collected with the average revenue per This system provides owners with a strong vehicle in the company. incentive to keep their vehicles in good working order, on the one hand, and to pick up passengers and report revenue accurately, on the other.
The average percentage of vehicles on the road daily for the Although most buses in the fleet were put CUTCSA fleet is 98.5 percent. into service 20-to-30 years ago, they are in excellent condition. The company puts 5 percent of revenues into a revolving fund for new bus Members have a choice of new buses, purchases and major overhauls. which are sold to them by CUTCSA at reasonable prices. The staffing ratio is six employees per operating bus. After operating costs and the 2.9 percent municipal tax were paid, Montevideo s bus companies profit averaged about 5 percent of Profitability varies substantially among the seven revenue in 1986. and even among owners within CUTCSA, which generally enjoyed companies, Among the factors contributing to this the highest performance Levels. unusually well organized and efficient system are motivation of the the attention paid to maintenance, and the coherent private operators, institutional setting in which there is a clear relationship between the responsibilities of the municipality and of the enterprises.,

Bangkok,

Thailand

Bangkok is a booming metropolis that houses nearly six million people; the population is growing at an average annual rate of 3.8 The most prominent feature of the city s transport sector is percent. ALthough !congestion, which clogs most of the city for most of the day. the city is reasonably well served by major radial highways, it lacks efficient use of suitable secondary roads and access roads , precluding The shortage of these roads forces Local the rbad system as a whole. traffic to use the main roads and results in Long needless detours, making journey speeds slow and vehicle operating costs high. Over two-thirds of motorized passenger trips in Bangkok are The major supplier by far is the Bangkok Mass made by bus or minibus. Transit Authority (BMTA), which has a fleet of 4,960 Large single-decker BMTA is the result of an effort s largest. buses ; one of the world which then consisted of 24 begun in 1975 to consolidate bus services, private and two state-run bus companies. There are some 5,000 minibuses

- 88 -

working in Bangkok, 60 percent of which operate on side roads, while the rest compete directly with BMTA. Many illegal minibuses, believed to Taxis number about number between S,OOO-10,000, are in operation. 13,000 and are unmetered. There are more than 8,000 sam1ors or tuktuks (small three-wheeler passenger vehicles), which are very popular and permitted to operate anywhere, and 4,000 silors (small fourwheelers) which operate only on side streets. With the creation of BMTA, the government hoped to rationalize routes, schedules, and fares; develop modern management practices; provide better service; and reduce congestion through the use of bus Lanes. Some improvements have clearly been made, but BMTA is in serious financial difficulties, having lost the equivalent of $58.4 million in 1984 and $43.5 million in 1985. The losses have eroded the company s funds to renew the fleet, buses are aging and capital base, and without deteriorating. No new buses have been bought in the Last five years. In 1985, 81 percent of the total fleet operated daily, making an average of 4.51 million passenger trips and carrying about 1,250 passengers per bus. A key problem facing BMTA is its inability, for political Previous efforts have sparked such unrest that reasons, to raise fares. fare hikes were rescinded, despite the fact that fares in Bangkok are among the world s lowest ($0.07 flat fare charged by BMTA and It has been estimated that BMTA would have to add 25 minibuses). percent to current fares in order to break even. The current imbalance between revenues and operating costs drains the company s resources to the point that BMTA cannot save the minimum required to renew its rolling stock. Also hindering the company s financial performance is its size. Rather than achieving economies of scale, costs have risen substantially due to the difficulties of managing such a Large and complex organization with excessive wage bills, absenteeism, and labor policy constraints. One solution that is showing some promise is the recent decision by BMTA to make increasing use of private contractors. Some 550 buses are operated either under joint ventures or are fully owned and operated by the private sector under BMTA control. BMTA received an aver age of $23,000 per bus from private operators in 1985. The number of private minibuses licensed to operate in Bangkok has also been Although reliable information on profitability is not increased. available, these private operators clearly earn a profit, despite the fact that they are required to keep to the same Low BMTA fare Increased private sector operations could help fill the gap structure. that is bound to occur as BMTA itself becomes increasingly unable to meet growing demand.

89 -

Santiago,

Chile of about 4.3 million growing at an unusual in that it has a more than In large measure, this is due to put into effect by the government

Santiago, with a population is annual rate of about 2.7 percent, adequate supply of public transport. the total deregulation of the sector between 1978 and 1982.

About 85 percent of Santiago s population uses public about The city offers several modes: a metro system serving transport. 10 percent of urban passengers daily; 5,600 large microbuses (seating 80-to-100) that carry about 42 percent of capacity 35; crush capacity urban passengers; 2,700 taxibuses (seating capacity 20; crush capacity 35-to-SO) that carry about 23 percent of urban passengers; and over serving about 10 percent of public 24,000 regular and shared taxis, Only the metro system is state owned and operated. A transport users. state owned bus system operating 1,500 vehicles was dissolved in 1980. Microbuses and taxibuses are one-man operated; most buses are Owners are organized into associations that individually owned. administer a revolving fund for oversee terminals, organize routes, and deal with legal and insurance problems. In the major repairs, these associations have come to absence of other regulatory agencies, exercise a high degree of monopolistic control over bus operations. Average fleet age is on the rise, utilization ratios range between 70 and each vehicle carries only about 500 passengers per and 80 percent, most operators are believed to Despite claims to the contrary, day. earn a good profit. Until 1978, the public transport system in Santiago was subject It was also inefficient; buses were extremely to stringent regulation. overcrowded and network coverage was poor. Beginning that year gradual steps toward deregulation were taken until now the city has one of the least government regulated bus systems in the world. For passengers, this has meant improved network coverage and an end to overcrowding. Operators have almost complete freedom in the choice of routes and, as a result, many new routes have been added providing services to new urban developments on the city s periphery. However, restrictions on additional buses apply to the congested inner city area. Fares (except for reduced student rates and free passage children and policemen) are set at the discretion of the operator, Taxi and shared-taxi operators are frequencies and vehicle types. also free to set their own fares. for as are

The perception that high profits were to be made brought The number of new microbuses numerous new operators on the scene* entering the system during the past eight years increased by almost 50 percent; the number of taxibuses grew by 75 percent. At the same time, and taxibus fares by 90 percent, in microbus fares rose by 150 percent on the other h&nd, have maintained fares at Shared taxis, real tetmsr

90 -

the same levels. The shared-taxi operators to seek ways to reduce

market is very competitive, costs and keep fares down.

leading

The rise in bus fares is not simply due to increased operating costs, but also results from the ability of route associations to apply pressure on individual operators to keep fares high. This undesirable feature of bus services in Santiago is in sharp contrast with the benefits of competition among shared taxis. The response of the poorest segment of the population to bus, fare hikes has been greater use of bicycles or *walking; it has been calculated that many low-income households spend 17 percent of earnings on transport. Other negative impacts of the policies in effect have been an Although deregulation has increase in congestion and air pollution. clearly increased the quantity of service offered, some regulation appears to be required to reduce congestion and improve bus safety and Also there is a need to make buses more emmission standards system. competitive in setting fares.

India Calcutta. The Calcutta Metropolitan District, with a population of 11 million, is the Largest urban center in India. Traffic conditions are among the most challenging in the world. Average speeds on major thoroughfares are lo-to-12 kilometers per hour, held down by the presence of not only cars, buses, and trucks, but hand-pulled rickshaws; goat herds, and. pedestrians unable to make their way along overcrowded sidewalks. Buses and minibuses carry about 80 percent of total passengers within the metropolitan district; railways, trams, and metro share the There is a serious deficit of public transport, remaining 20 percent. due in part to the ongoing deterioration of services provided by the state-owned bus and tram companies. The Calcutta State Transport Corporation (CSTC) was established in 1960 to function as a commercial undertaking in the public sector. After several years of relatively successful operations, in 1963 the CSTC began experiencing a decline in financial and operational performance and quality of service. By 1984 the corporation was running requiring ever-greater subsidies to support evera $12 million deficit, A World Bank project involving the purchase of new declining services. the upgrading and construction of workshops and depots, and fare buses, increases failed to turn the situation around. CSTC currently operate s 700 of which are on the road each day (560 buses are used 1,100 buses, in urban routes and the remaining 140 buses are used in long distance about 200 break down during the course of Of these 700 buses, trips). each day.

91 -

Analysts today attribute much of CSTC s trouble to organizational and management problems and Low morale throughout the corporation. Labor management problems are rife, as is absenteeism; decisionmaking is overly concentrated ; and many key staff appointed Lack relevant experience. About 2,200 regular private buses (1,900 of which are on the They utilize Indian made road everyday) ply routes throughout the city. 34-38 seat vehicles, each usually Loaded with 80-to-100 passengers, and carry in total about 3.3 million passengers daily. Some 850 minibuses (out of a total 9501, seating 20-30 passengers, operate daily on 72 routes and carry about 800,000 passengers. Owners and drivers of both types of vehicles are organized into owner-operators are virtually nonexistent. Drivers associations; receive a fixed wage plus a commission based on revenues above a certain threshold, providing an incentive to combat fare evasion and maximize revenues. Minibus fares are generally twice as high as CSTC fares, and minibus owners enjoy a yearly return on investment of about 30-to-36 percent. Precise figures are not available for private buses, but although their total operating costs per passenger kilometer are about half those of CSTC, their profits are Lower than those of the minibuses because they charge the same fares as CSTC. As CSTC service declined and the quantity of privately owned transport increased, the number of vehicles active in the public transport sector has increased. Minibuses were originally conceived to provide comfortable, reliable transport for a higher fare. Growing demand, however, has meant that the minibuses are more and more crowded and now provide service that is essentially identical to other mass transit modes. Chartered buses, of which there are about 550 in operation, now provide the higher quality service once offered by minibuses. Tamil Nadu State. Two cities in the Indian State of Tamil Nadu have developed profitable and efficient bus companies that offer good quality service at low cost. Both the Pallavan Transport Corporation (PTC), in Corporation (CTC), in Coimbatore, are Madras, and the Cheran Transport incorporated as Public Limited Corporations by the Tamil Nadu State government. In both cases, the government acts to regulate some aspects but Leaves most decisions to company managers. The of bus operations, success of these two companies is an indication that public corporations, if managed by competent professionals and operated along commercial lines, can be financially self supporting. Madras. Pallavan Transport Corporation (PTC) is the only bus company offering service to the nearly 5.5 million inhabitants of Madras. About 46 percent of the population rides buses; the next largest group (28 Traffic flows with relative ease, the road network is percent > walks. good and well connected, but traffic efficiency is inhibited by reckless driving, indiscriminate parking and stopping of vehicles, and overflowing sidewalks.

92 -

Although the State government sets fares, other business The company runs operating decisions are made by PTC management. fleet of 2,102 large, single-decker buses, with an overall fleet carrying over 3 million passengers utilization rate of 87 percent, .t, daily. .,. 3, PTC provides efficient servi e to its riders, with short of riders have less waiting periods at bus stops. Over P& percent a ten-minute walk from bus to home or work and over 80 percent can Bus speeds average 16-18 kilometers per hour, having to transfer. Overcrowding during peak hours most trips are completed on time. only major problem facing riders of PTC buses.

and a

than avoid and is the

Despite low fares (fares are graduated according to distance, beginning at $0.03 for the first two kilometers) and student passes costing less than half the normal fare, PTC broke even in 1986. The total operating cost per passenger kilometer was remarkably low at including depreciation and interest. $0.008, One important key to PTC s financial success is its attention to maintenance at every level. Routine maintenance and cleaning is undertaken regularly in each depot. All vehicles are taken out of service for one or two days every six months to undergo preventive maintenance. During this time , major components are sent to a reconditioning unit. Engines are fully reconditioned about every two The company also maintains workshops specializing in body year 9. building and repair and recycling of transmission parts. In addition, a oil reclamation plant recycles 60 percent of the oil used by PTC buses, saving the company about $60,000 annually. Depots also serve as cost centers, where checked on a daily basis. Each month the 17 depots to operating performance, and financial bonuses are accordingly. performance are ranked distributed is according

PTC management is considering the introduction of further cost such as route rationalization and bus/crew recovery measures, rescheduling studies; devising a bus operating cost index in order to justify future fare increases; and the development of an improved financial forecasting model that would compare the company s operating and financial performance against productivity targets, in order to ensure that bus operations are efficient. The Cheran Transport Corporation was created in 1972 when Coimbatore. the state government nationalized all private transport enterprises with more than 100 vehicles. CTC was mandated by the state to provide cheap and efficient bus service while maintaining financial viability. The new company s directors maintained the corporate structure and practice already in place and have concentrated on improving efficiency and As a result, CTC has been able to generate a substantial development. operating surplus while providing good service to its passengers.

93 -

Beginning with 300 buses in 1972, the company now operates 1,086 stage buses that each carry about 1,100 passengers daily. CTC operates in competition with 520 private buses that carry about oneCTC s fleet utilization ratio averages 95 third of the city s riders. The company employs 7.3 staff members per operating bus, who percent. Both CTC and receive a salary and a small percentage of daily receipts. private buses charge $0.024 for the first two kilometers, and fares rise with distance. Fares are set by the state government, which otherwise has little involvement with the company. CTC, for example, can borrow and the board of directors is free to appoint managers from any source, based exclusively on professional!criteria. CTC is organized into several branches, or depots, accoridng to a highly decentralized pattern in which branch managers have total responsibility for operations, maintenance, and finance. Areas of responsibility within each branch are clearly defined, and staff The salary structure reflects performance is monitored closely. bonuses are awarded on the basis of seniority and performance; achievement. Because wages are relatively high and beyond the company s control, CTC is gradually reducing staff through attrition in hopes of eventually reducing the staffing ratio to 6.5 employees per operating system was recently computerized, bus. To this end, the accounting eliminating new hiring of clerical personnel, and management is considering a gradual switch to one-man bus operation. Other variable costs are being reduced in innovative ways. CTC introduced a unique tire retreading process and manufactures its own rubber. It also began in 1983 a body building operation, with a target of 750 bodies for the 1986-87 fiscal year. More than half of the bodies manufactured are sold to other bus companies, generating substantial revenue. As a result of these practices, CTC earned a net profit of $750,000 during its 1984-85 fiscal year. The operating ratio of total After distributing 25 revenue over costs, excluding interest, was 1.05. percent of the surplus among employees and paying state surtaxes of 16 percent, the company transferred the remainder to a general reserve fund to be reinvested during the following year in fleet expansion.

Khartoum,

The Sudan

The Greater Khartoum area of The Sudan is characterized by a rapidly growing population (6.7 percent annually), difficult road and and a severe shortage of public transport. traffic conditions, The which carry only 2.8 percent of the city s situation of public buses, is particularly serious. Public transport suffers from passengers, inefficient organization and the country s general lack of foreign currency to purchase new vehicles and spare parts, as well as from a scarcity of skilled professionals.

94 -

The. two public bus companies are both currently being run by the Defense Ministry, although they are operated separately to enable The ministry the ministry to evaluate each company s performance. At present, however, intends to merge the operations eventually. one of the units is highly despite the shortage of public transport, overmanned, while the other has to keep some of its buses out of service creating an obvious waste of resources. for lack of drivers, One of the two units, known as the Mercedes Unit, began operating in 1974 as a public transport company owned and operated by the Khartoum Province authorities under the supervision of the Ministry The company sustained continuous losses, until in 1985 it of Transport. Only 60 of its original was taken over by the Ministry of Defense. fleet of 450 buses are still operational and, of those, only 40 function Of 40 new buses bought in 1982, only eight work on a daily basis. Difficult operating conditions, combined with the lack of spare daily. parts, have plagued the unit s operations. Moreover, political and union pressures have kept the staffing ratio at the extremely high level of 15-to-20 per operating bus. Fares do not cover operating costs, and the unit lost $400,000 in 1985. The other public bus company, known as the Pegaso Unit, was created by the Ministry of Defense in 1982. Its 141 buses are in good wi&h an utilization rate of 78 percent. However, most of working order, the buses are used to transport soldiers and students, and are only Thus available for other passengers during morning off-peak hours. Pegaso bus\es carry only 0.4 percent of the city s passengers. Although it charges the same fares as the other unit for regular passenger trips, the Pegaso unit s average operating cost per passenger/kilometer is half that of the Mercedes unit. A larger percentage of the population (27 percent) rides Ahlia owned converted trucks or secondhand buses buses, which are privately About 700 such buses are that can carry between 45-70 passengers. with an availability rate of engaged in urban public transport services, Provincial authorities determine routes, fix fares, and 80 percent. but otherwise exercise little control over Ahlia supervise performance, bus activities in order to encourage market entrance, given the scarcity Both fares and operating costs are lower than of public transport. and it is estimated that each vehicle those of the publicly owned buses, makes an annual profif: of at least $2,500. Privately owned minibuses and converted pickups, known as bakassis, together serve about 25 percent of those seeking public transport. The government is also although the use of bakassis, encouraging expanded minibus service, which are chronically overloaded, poorly maintained, and have a high is being discouraged. accident rate,

Buenos Aires,

Argentina

The Buenos Aires public transport system operates in a relatively favorable environment; demand is growing slowly, roads are The bus well maintained, and traffic conditions are comparatively good. system is run by experienced operators who have devised over several decades an efficient organizational structure that permits buses to operate at a profit while providing good service to passengers. The city s fleet of 15,000 privately owned buses, known as Metro colectivos , account for 83 percent of public transport trips. No publicly and suburban rail systems and taxis share the remainder. owned buses have been in operation since 1955, when an unprofitable publicly owned system was dissolved. Most buses are Locally Average manufactured Zl-seaters with a total capacity of 60 passengers. of the buses operate fleet age in 1985 was 5.5 years ; about 90 percent each carrying between 850 to 1,100 passengers per day daily on weekdays, The staffing -- a very high number given the small size of the buses. on the bus company; all ratio ranges between 2.1 and 3.6, depending buses are one man operated.
0

that represent The fleet is organized into 300 companies The partners individuals or small groubs of owners call&d partners. are entirely responsible for ope.rating and maintaining their vehicles, while the company assumes responsibility for scheduling bus services and represents its members in discussion with government agencies. In recent years, innovative cost-cutting techniques were adopted as Some companies own inflation began rising faster than fares. maintenance plants and many manage revolving funds whereby a certain percentage of revenues is put aside for fleet renewal; the company buys Some of the the buses and sells them to the partners on credit. companies have reduceid costs by computerizing their management information systems. the owner keeps the fares collected but the In most cases, company ensures equitable earnings by interchanging routes and schedules The system is one in which operating cost risks are on a weekly basis. borne by the owner, while revenue risks are shared between the owner and operating costs per passenger/kilometer are the company. On average, between $0.20-$0.25; profitability varies among the companies, although this is not usually the case among partners from the same company. Service levels are good, and most passengers get virtual doorto-door service. Riders in high-income neighborhoods are prepared to pay up to four times the normal fare for luxury bus service. The standard buses are not particularly comfortable, however, and safety has in part due to the one man operation of the been an ongoing problem, do not cause congestion on main routes, and they buses T The colectivos maintain an average speed of 15-20 kilometers per hour in the city.

96 -

The companies are regulated by a variety of government which creates considerable red tape. Fares, for example, authorities, are set by the federal government for routes inside the federal district; other routes are governed by provincial or municipal The Lack of coordination has meant slow response to authorities. fares, Moreover, requests for change in routes, frequency, fares, etc. which average $0.14 for most trips, have fallen behind inflation levels tendency toward leading to a general over the past decade, decapit-Lization that could seriously affect the system if it continL J. The creation of a single transport authority for Buenos wnile retaining the present system of private operation, could Aires, help alleviate many of these problems.

97 -

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