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Calls for YBS fare hikes mount as losses widen

It’s been more than a year since the Yangon Bus Service (YBS) was launched in Yangon in January 2017, but many routes are still loss-making. As a result, calls for measures to reduce the pressure on YBS margins and alleviate costs on the loss-making routes have been on the rise.

“At fares of K200 per person, some bus lines are not able to make money. The YRTA should review the fares as some of the lines will not be sustainable in the long term at the current fare,” said U Kyaw Zay Ya, an MP from Dagon township.

So far, the YRTA has denied the rumours. “We have no plan to increase bus fares on YBS bus lines,” YRTA secretary U Maung Aung said. Bus fares on all routes excluding long-distance routes will remain fixed at K200 per rider.

Loss-making

But why are some bus routes losing money? One reason is poor collection of fares. With little or no supervision on the busses, passengers often do not pay the right fares.

Meanwhile, the costs of running the new buses are on the rise. Other than having to pay for more expensive buses, the operators must now also fork out regular maintenance fees as well as buy insurance, which is compulsory for all YBS vehicles.

“Because the YBS buses are newer and better models than before, insurance premiums are also higher than before and this has driven up costs,” said U Min Naing from Bandoola Transportation Co, which is owned by The Union of Myanmar Economic Holdings (UMEHL) and not under YBS.

Administrative costs have also risen. “As the YBS is new and expanding, more manpower new technology to perform operational and financial tasks is needed and this will drive up costs,” said Ko Ta Yoke Lay, owner of Power Eleven Company, which runs the YBS21 bus line from northern Hlaingtharyar township to Lanmadaw township.

Despite widening losses, route operators are not able to reduce the number of buses or adjust fares to minimise costs without YRTA permission, U Min Naing said.

‘’As we are under UMEHL, we don’t need to worry about making losses. But for the YBS operators, they will not be able to continue operator for much longer if the government does not do something,” said U Min Naing.

“In my opinion, many YBS bus lines will continue to make losses in 2018 if the bus fares are not adjusted,” said Ko Ta Yoke Lay.

Government support

Raising bus fares will not be an easy task though. “People at the grass root level rely on public transportation to commute. The government needs to take their earnings into account if it intends to raise fares and this cannot be done easily,” said U Min Naing.

For its part, the Yangon government has taken efforts to help the bus lines reduce their costs. It will soon implement a card payment system on all YBS buses to ensure bus fares are deducted accordingly. Earlier this year, Excel KC Myanmar Co won the tender to install Yangon Payment Services (YPS), a cashless payment system on the buses. The system is expected to go live across Yangon very soon.

The government has also said that it will offer support to loss-making bus lines such as allowing them to supplement income by running other businesses such as convenience stores at petrol stations or near bus stops.

Still, many reckon higher bus fares will eventually be needed to sustain the YBS over the coming years. ‘’In my opinion, the government would have anticipated this problem earlier, which is why they are implementing the card payment system. When the YPS is up and running, the bus fares can be increased slightly in exchange for convenient transportation. If passengers want better public transportation, they must pay higher bus fares,” said Ko Ta Yoke Lay.

Source : Myanmar Times

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