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MMDA proposes merger of bus companies

/ 04:41 PM June 20, 2012

MMDA Chairman Francis Tolentino. INQUIRER FILE PHOTO

MANILA, Philippines—Francis Tolentino, chairman of the Metropolitan Manila Development Authority, proposed Wednesday the merging of operations of bus companies in the metropolis to bring order and sanity in the streets and to ensure a more efficient public transport system.

To encourage the merger, transport regulators could dangle incentives similar to the ones being given to companies who have been upgrading their fleets, Tolentino said in a press statement.

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“The [Land Transportation Franchising and Regulatory Board] can grant incentives to companies who opt to merge or consolidate, such as granting them preferential and exclusive Certificates of Public Convenience (CPCs),” he said.

Tolentino said that the perennial problems of poor service, dangerous driving and the proliferation of illegal commuter vehicles referred to in the vernacular as “colorum”  could be solved by consolidating the operations of several bus companies.

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Ultimately, these problems contribute significantly to the long-held perception that Metro Manila’s traffic congestion is the outcome of the “inefficient operation of public utility buses,” he added.

The MMDA head cited the experience of Singapore and Colombia where the governments encouraged such mergers, streamlining the operations of the bus companies and resulting in more efficient public transportation systems.

He also cited the trend in the United States where the spiralling cost of fuel forced several airlines to merge with each other. These measures were being taken to increase a company’s profitability and sustainability in the business, he said.

“Singapore has one of the best public transportation systems in the world, and it never would have been realized if not for the government’s initiation of mergers,” Tolentino said.

Some of the incentives available to transport companies are a 10-year certificate of public convenience in exchange for brand new fleets of vehicles, according to Tolentino.

The proposal would complement the MMDA’s current programs to address the worsening traffic condition in Metro Manila, like the updating of the organized bus route system and the implementation of the bus rapid transit system.

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TAGS: Mergers and Acquisitions, Metro, News, Public Transport, Road Traffic
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