• Sun
  • Dec 28, 2014
  • Updated: 5:43pm

KMB justifies fare hike

PUBLISHED : Wednesday, 11 December, 2013, 3:27am
UPDATED : Wednesday, 11 December, 2013, 3:32am

In their letters, Kenny Pun Tsz-him ("A well-worn path for KMB fare hikes", December 7) and Pun Ka-hung ("Driven to distraction by KMB claims", December 8) question the need for KMB to raise fares.

KMB fully appreciates that a fare increase will have an impact on the community, but the fact is that KMB has been facing continued losses and faces disproportionately higher operating pressure compared to other bus franchises.

In the past 11 years, many railway lines have been introduced within KMB's operating area. These include the Tseung Kwan O Line, West Rail (Tuen Mun to Nam Cheong), Ma On Shan Line, Lok Ma Chau Spur Line, Tseung Kwan O Spur Line, and the Kowloon Southern Link.

As a result, KMB's daily ridership has experienced a sharp decline of 500,000 passenger-trips, from 3.1 million in 2002 to 2.6 million today. Currently, the company operates around 400 routes and 70 per cent of them are loss-making.

These loss-making routes are being subsidised by the remaining 30 per cent, which are profitable; this is an unhealthy and unsustainable situation.

To tackle this structural problem, KMB has been working with the government and district councils to reorganise obsolete and lowly utilised routes for greater efficiency. However, the progress of route reorganisation has been slow, with only 5 to 6 per cent of KMB's network having completed its restructuring so far. To effectively alleviate fare pressure, the pace of this network restructuring exercise must be rapid and extensive.

The health of a bus company's network is part and parcel of its ability to withstand operating pressure in an environment of rising costs.

To illustrate this point: Long Win Bus Company Limited, a sister company of KMB managed by the same senior management team, has not applied for a fare adjustment this year because its bus network is still relatively healthy.

KMB appreciates its social responsibility not only in maintaining affordable fares, but also in delivering quality bus services to 2.6 million passengers each day while sustaining the livelihoods of its 12,000 staff.

The company genuinely needs the additional financial resources via its application for a 4.3 per cent fare increase to maintain financial health in 2014.

In the meantime, we sincerely hope that we can work closely with the government and district councils in expediting our route reorganisation efforts.

Evan Auyang, KMB deputy managing director


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This article is now closed to comments

Bus fares in HK are extremely reasonable and KMB should be allowed to rationalize routes and set fares to remain a profitable company. We want new and clean buses and someone has to pay for this.
I agree that the expansion of raliway network has brought an adverse effect to the business of KMB or other public transportation on land because they are substitution. But the management of the KMB has hid the fact that its other business segment, advertisement business of Roadshow, has been making money through bus advertising. It is only the corporate structure that Roadshow is running separately from the bus operation. After looking into the whole picture, is the application for the fare hike by KMB is justified?
KMB, because of sensitivity about upsetting the Government, has overlooked explaining that falling revenue is also exacerbated by severe traffic congestion in down-town areas. Congestion reduces the number of services operated and also discourages passengers from taking buses.
The increase in congestion is a due to the specific policy failure of the former C.E and Chief Secretary, who over a decade not only failed to contain the explosive growth of private car ownership but also persuaded the police to reduce enforcement of traffic regulations by issuing fixed penalties. The resulting widespread disregard for traffic violations is now costing all the community dearly in lost productivity. KMB and their passengers are but one victim.


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