The business environment of regional bus companies is deteriorating. The problem is how to protect an important means of transportation for people's everyday life.
Five bus companies offering fixed route services in Kumamoto Prefecture have agreed to jointly manage their business operations. The agreement is said to enable these firms to share buses and drivers with each other, thereby maintaining unprofitable routes only utilized by a limited number of people.
To be specific, these companies will consolidate overlapping routes in urban areas that are used by many passengers, and utilize buses not used there to serve suburban and sparsely populated areas. They will also consider a mechanism for pooling and sharing earnings from bus fares among them, so that bus operators in charge of highly profitable areas will not solely benefit from these arrangements.
Technically, bus companies jointly managing their operations could constitute an unlawful cartel under the Antimonopoly Law.
In an effort to support regional areas, the government will submit to the Diet, as early as its current session, a bill aimed at complementing the antimonopoly legislation to waive some cartel regulations for bus companies.
Bus routes constitute important infrastructure for supporting people's lives in regional areas. Given this, the course of action aimed at promoting joint bus business management to continue services is understandable.
Needless to say, the bus companies to which special measures will be applied should make even more rigorous efforts to improve their business management. They must thoroughly streamline their operations, possibly with a view to a merger in the future.
Will the latest agreement allow the principle of competition not to function through these firms' market dominance in their region, thereby imposing a greater burden on users or easily doing away with routes? They need to be placed under strict scrutiny.
Public-private efforts needed
The abolishing of bus routes or reduction of services in underpopulated areas is continuing. There is also a serious shortage of drivers in those areas, due to long working hours and low wages.
In fiscal 2017, more than 80 percent of fixed-route bus companies, not including those in the three largest cities and neighboring areas, were operating at a loss. In more than a few cases, local governments extend a large amount of subsidies to support bus companies in their regions.
A decline in the quality of public transportation systems can contribute to a decrease in population, making it more difficult to maintain transportation infrastructure. There has been an increase in the number of cases in which local governments and business operators make efforts to stem such a vicious circle.
The Nara prefectural government has set guidelines for such matters as the revenue-to-expenditure ratio and the amount of subsidies to be borne by administrative authorities, with respect to about 50 bus routes serving sparsely populated areas and the like. The local government examines conditions facing each route under these criteria every year, and it devises remedial measures on routes that cannot meet these guidelines, such as cuts in the number of buses in operation.
If it is difficult to sustain any route even with these measures, the prefectural government shifts to such transportation means as community buses that serve a small number of people
In Takamatsu, progress is being made in creating a system in which bus passengers from underpopulated areas are encouraged to change to trains in the suburbs, with a view to rectifying the current situation in which plural bus routes from underpopulated areas overlap each other in the city center. The city government is encouraging people to change to trains by providing discounts on transfers.
Retaining transportation networks is a problem common to regional areas. By studying precedents in this respect, too, the public and private sectors are advised to exercise their wisdom in devising measures suited to the realities of each region.
-- This article appeared in the print version of The Yomiuri Shimbun on Feb. 25, 2020.
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