Bus routing strategies in a transit market: A case study of Hong Kong

Conventionally, the objective of transit routing is often set either to minimize the total operational cost, subject to a given level of service quality, or to maximize the service quality at a given acceptable cost. In a deregulated, commercial‐based environment however, such as bus and railway operations in cities of the UK and Hong Kong where several private firms compete in route‐based or area‐based market, routing becomes one of the means for higher returns rather than just for cost saving. In such a case, how do the transit providers set up their routes for profit‐maximization? Will the routing based on the provider's objective meet the user's objective? How do government regulations and policies affect the choice of transit provider's routing strategy? To answer these questions, we first examine the relationship between the objectives of users and transit providers, set up criteria for transit routing quality, and then investigate the possible routing configurations/patterns for a hypothetical case. These criteria include (1) the load factor of transit, (2) the level of route directness, (3) the level of route overlapping, and (4) the total number of routes and (5) the average of route length. These measures are finally applied to a real case in Hong Kong to examine the route changes of Kowloon Motor Bus from 1975 to 1995. The result of the empirical case reveais how key measures such as load factor are controlled by the bus operator and affected by government policies and how the bus routing pattern was adjusted to meet users' need. Facing the dilemma as evident in Hong Kong between the route directness and the efficiency of road use, we suggest that a rational multi‐modal routing structure be put in place if an institutional solution is introduced so that bus and other transit modes can form a sharing program or an alliance.     

The role of paratransit: some reflections based on the experience of residents’ coach services in Hong Kong

Paratransit refers to urban transport services “somewhere between private passenger transport and conventional public transport in terms of cost and quality of service” [Rimmer (1980), Paratransit: A commentary. Environ. Plan. A 12, 937–944]. Since the 1980s, a new form of paratransit—residents’ coach, which provides exclusive transport services to residents living in private housing estates—has emerged in Hong Kong. What was the background underlying the emergence and subsequent growth of residents’ coach services? Also, what was the role of residents’ coach in the public transport system of Hong Kong? With the completion of more railway extensions, should residents’ coach services be replaced? If so, what are the potential impacts on people’s life? This paper addresses the above research questions through a large-scale questionnaire survey that examined not only people’s modal choice but also their residential choice, socio-economic background and attitudes. The findings suggest that transport policy makers should pay more attention to examine new forms of paratransit and the ways of integrating them into the overall public transport system, both spatially and temporally. It is only through the development of an efficient and multi-modal transport system can the maximum potential of paratransit in filling the transport gap between conventional mass transit and private cars be realized.     

Efficiency of the public and private bus transport sectors in Sri Lanka

The public and private bus sectors are in direct competition in most bus routes in Sri Lanka. Consequently, Sri Lanka is an ideal location to study their relative efficiencies. Five dimensions of transit performance are analyzed for comparing the relative efficiencies of the two sectors: cost efficiency, labour efficiency, input efficiency, revenue generation and safety. Productivity ratios are utilized for measuring the dimensions of transit performance. The productivity ratios for cost efficiency, labour efficiency in terms of total staff, input efficiency, revenue generation and safety in terms of accidents per bus showed the private bus transport sector to be more efficient than the public bus transport sector.     

Using risk analysis to determine the potential range of lifecycle costs for urban transit systems

Intense competition for limited public funding for urban transport projects can often result in proponents of individual schemes presenting minimized costs and maximized benefits to funding bodies to try to ensure that their scheme is chosen above others for funding. This presents public bodies with a problem, especially in an era when they are keen to attract private contributions for transit schemes. Risk modelling techniques can be of great assistance in ascertaining ranges of costs and benefits for individual submissions and deciding upon which projects should receive priority-not only those with greatest cost-benefit indices, but also those whose indices have low levels of associated risk to allay the fears of the traditionally risk averse private sector.     

Planning and control of paratransit services in Hong Kong

As paratransit services, Hong Kong's taxis and public light buses (PLB) carried some 30% of the 9.7 million daily public transport boardings in Hong Kong in 1988. Most of the vehicles are individually owned, and services are operated as commercially viable concerns. While operators have a high degree of operational flexibility, taxis and PLBs are closely regulated by the Government. The fleet sizes are controlled by licensing. There is a system of zoning for taxis, and operational prohibitions and restrictions for PLBs. Over the years, Hong Kong has developed some practicable means of operational control on taxis and PLBs. It has been 20 years since PLBs were legalized in 1969. The transition experienced by this mode, from no control to regulated operations, signifies a major step forward from the point of view of transport administration. The Government's participation in the planning for PLB services has guided the development of this mode. In this paper, the planning and control mechanisms for Hong Kong's paratransit modes are introduced. Identified deficiencies are also discussed.     

Reducing the cost of peak hour transit service through contracting out service

Transit service contracting has responded to fiscal and financial woes of public transit agencies as the most uniquely attractive cost‐saving strategy at present. Most transit service contracting, however, has been in the traditional provision of entire fixed route bus service or commuter express bus service, and exclusive demand responsive service for the general public or for special disadvantaged population groups such as the elderly and/or the handicapped. This paper presents a new module in transit service contracting whereby the public and private operators jointly provide the peak service on the same route and at the same time. While the public agency provides the base demand of the service, the private provider provides the excess demand, both following the same schedules and similar service arrangements. In this paper, proposed service arrangements, costing and contracting procedures are discussed. It is also reported that substantial cost savings ranging from 32 to 57% with an average savings of 48% can be achieved if the excess peak hour bus transit service on highly peaked routes in public transit agencies is contracted to competing private operator(s).     

Commercialising the management and maintenance of trunk roads in the United Kingdom

Public funding of new infrastructure from money raised through taxes or borrowing has been questioned globally in recent years. One alternative solution has been to finance major capital projects through Build, Operate & Transfer (BOT) schemes. In the United Kingdom, the Private Finance Initiative (PFI) has become established as the procurement method of choice for many projects and services in central and local government. It is a natural development of other changes in government administration which have been introduced over the past few years. Projects delivered in this way enable government to become a buyer of services on behalf of the public rather than a direct provider of those services to the public, taking advantage of private sector management skills and resources in their delivery. The PFI has demonstrated its ability to deliver value for money solutions in projects across a range of capital-intensive public services, but the greatest success in delivering projects has been in the transport sector. This paper outlines how the British Government's Highways Agency has restructured and commercialised the management and maintenance of the strategic road network for which it is responsible, and how it has been at the forefront of developing successful privately financed projects. The paper explains the Agency's particular version of BOT – Design, Build, Finance and Operate (DBFO) projects. These projects are delivering new and improved road construction and maintenance, providing better services to users of the country's strategic road network and achieving significant value for money savings for taxpayers.     

National policy towards cars: Hong Kong

The Hong Kong transport policy objective is simply, mobility. With this the automobile must conform. A confined land area, difficult to develop, has absorbed excessive immigration and must now service a dynamic entrepreneurial economy.

Transport infrastructure based on major planning studies is created through government capital and is backed by careful legislation, effective administration and private sector participation. The problem is that overall expansion is even faster: widespread urban renewal—roads cannot equally expand; enormous New Territories New Towns—people still want to move in and out so the need for more transport accelerates. Over ten million trips daily are made by 5.5 million people. The answers cannot be more and more private cars: it must be promoting the most effective use of major transport investments, where possible off roads, and the mass carriers on roads. The need to curb congestion by containing escalating car numbers (especially as so far only 17% of households have access to an automobile) led in May 1982 to imposition of severe taxes on ownership. The ultimate and equitable objective is to control usage. Road pricing may be the answer.

In Hong Kong the private cars is part only of a complex strategy including metro, rail, bus, minibus, ferry, taxi and tram. The car cannot take precedence.     

The theory of second best in urban mass transit: Management in the public sector as a proforma exercise

This paper focuses on four issues. The first is the case of one-sided investments in mass transit in metropolitan areas of developing countries. It is pointed out that in many cases in which the conditions for optimum investment policies (Pareto's Optimum) are not maintained, excessive investments on mass transit, including large annual operating subsidies, usually lead to substantial sub-optimizations and waste of scarce financial resources. This problem is then reviewed under the light of the “Theory of Second Best” as articulated for all investment options within Welfare Economic Theory. The second issue examined is the matter of recently discovered important diseconomies of scale of large metro transit systems in developing and developed countries, and the need to retain production of transport services within small-scale production units that are well coordinated and controlled. The third issue discussed is the problem of mismanagement of most public sector transit companies and agencies. The notion that most such systems are simply administered, not managed, is being brought up and the requirements for proper management are amplified. Finally, the case of public vs. private ownership of mass transit is being discussed with a distinction between public policies of providing mass transit services and the actual production process of these services. Provision of services represents a public responsibility that belongs to the public sector. However, production of service is a techno-economic process that requires different talents and circumstances. The paper concludes with a strong suggestion for major reorientation of urban mass transit in the metro areas of developing countries towards more efficiency and higher productivity.     

An actuary method for the estimation and comparison of urban bus transit cost of services

This paper presents a new cost allocation method developed for estimating the fully-allocated costs of the excess peak hour bus transit service provided by two public transit systems. The estimates were produced for the explicit purpose of carrying out a realistic comparison of these costs and the costs of the potential provision of the same service by private operators. The method utilizes the same service data for the analysis. The pragmatic estimation of the fully allocated costs of service by the public and private sectors enables a more accurate estimation of potential cost savings. Sensitivity analysis was also performed using the same costing procedure to determine the range of cost savings that are feasible in a competitive contract arrangement of private sector providers. The new method separates costs of the direct provision of service from other indirect costs and thus facilitates the identification of each cost item and its significance in comparative cost estimates.     

Optimal bus fleet management strategy for emissions reduction

Transportation is a major cause for environmental degradation via exhaust emissions. For many transit-oriented metropolitan areas, bus trips often constitute a sizeable mode share. Managing the bus fleet, in particular updating buses to comply with the newer emissions standards, therefore, can have a substantial impact on transportation-induced air quality. This paper presents the approach of remaining life additional benefit–cost (RLABC) analysis for maximising the total net benefit by either early-retiring or retrofitting the current bus fleet within their lifespans. By referring to the net benefits for different bus types estimated by RLABC analysis, the most beneficial management scheme for the current bus fleet can be identified. Optimal bus fleet management (BFM) models based on the RLABC analysis for the operator and the government are developed. Then a government subsidy plan is produced to achieve win–win solutions, which will offer efficient and flexible management schemes. To illustrate the approach, the largest bus company in Hong Kong, which carries more than 23% of the total trips in Hong Kong, is taken as a case study example. Instead of adopting a fixed retirement plan, such as replacing buses at the age of 17 as is currently practised, the proposed method develops an optimal BFM scheme that progressively phases out buses or retrofits them. This study produces promising results to demonstrate the large benefit of this approach for optimal bus fleet management.     

Fare deregulation of transit services: Winners and losers in a competitive market

Currently, the Hong Kong government imposes fare control on buses and taxi while the rail services are immune to such a control. This study examined four scenarios of fare deregulation on transit services by considering three related parties of a transit system – service providers, travelers, and society in general, with their respective objectives represented as – revenue, travel utility, and congestion. Analyzing the resultant impacts on these three parties, we found that a different regulatory environment would favor or hurt a different set of parties. There is no clear win‐win situation for all parties. Deciding a socially acceptable regulatory environment is likely to involve difficult tradeoffs among these parties.     

Importance of user perception in evaluating level of service for bus transit for a developing country like India: a review

Assessment of service quality in bus transit planning has received due attention in recent years from the viewpoint of optimal service allocation. The concept of level of service (LOS) has emerged as an effective tool to measure quality of services. Service-quality assessment provides operators with knowledge on users' satisfaction with existing services and their expected LOSs. The importance of user perception towards assessment of LOS has been acknowledged by researchers. While LOS standards for public transportation have been established by the Transportation Research Board in the USA, researchers have questioned the applicability of these standards in the context of different geographic regions. Since the service delivery environment differs between developed and developing nations, the user perception of service quality varies between these economic regions. Substantial research has been carried out in the context of both developed and developing nations, to identify the bus transit service parameters that affect users' perceived service quality; however, little research exists that establishes LOS thresholds for bus transit, based on user perception. This paper reviews the concept of LOS, describes the importance of user perception in assessment of service quality and identifies the need to establish LOS thresholds for bus transit from user perception for developing countries.     

A whole-system approach to evaluating urban transit investments

New transit capital expenditures are typically evaluated in isolation from the transit/transport systems to which they belong. Problems with reporting performance elements such as ridership and costs are discussed. A focus on evaluating the total transport systems impact of new transit project implementation is called for. On this basis, new US rail transit systems have generally performed poorly. Total transit ridership has generally shown only minimal improvements and, at times, has declined. Financial performance has been disappointing in most cases, particularly when understood in the context of the additional system costs imposed through the reconfiguration of bus networks to serve the new rail systems. Low-cost approaches to improving basic transit services can often be more effective than either rail or bus capital-based projects. An obsession with technology leads to the wrong questions being asked. We should instead start inquiry with the study of needs.     

Modeling intermodal equilibrium for bimodal transportation system design problems in a linear monocentric city

This paper investigates the intermodal equilibrium, road toll pricing, and bus system design issues in a congested highway corridor with two alternative modes - auto and bus - which share the same roadway along this corridor. On the basis of an in-depth analysis of the demand and supply sides of the bimodal transportation system, the mode choice equilibrium of travelers along the continuum corridor is first presented and formulated as an equivalent variational inequality problem. The solution properties of the bimodal continuum equilibrium formulation are analytically explored. Two models, which account for different infrastructure/system regulatory regimes (public and private), are then proposed. In the public regulatory model, the road toll location and charge level are simultaneously optimized together with the bus service fare and frequency. In the private regulatory model, the fare and frequency of bus services, which are operated by a profit-driven private operator, are optimized for exogenously given toll pricing schemes. Finally, an illustrative example is given to demonstrate the application of the proposed models. Sensitivity analysis of residential/household distribution along the corridor is carried out together with a comparison of four different toll pricing schemes (no toll, first best, distance based, and location based). Insightful findings are reported on the interrelationships among modal competition, market regulatory regimes, toll pricing schemes, and urban configurations as well as their implications in practice.     

The impact of real-time information on bus ridership in New York City

In the past few years, numerous mobile applications have made it possible for public transit passengers to find routes and/or learn about the expected arrival time of their transit vehicles. Though these services are widely used, their impact on overall transit ridership remains unclear. The objective of this research is to assess the effect of real-time information provided via web-enabled and mobile devices on public transit ridership. An empirical evaluation is conducted for New York City, which is the setting of a natural experiment in which a real-time bus tracking system was gradually launched on a borough-by-borough basis beginning in 2011. Panel regression techniques are used to evaluate bus ridership over a three year period, while controlling for changes in transit service, fares, local socioeconomic conditions, weather, and other factors. A fixed effects model of average weekday unlinked bus trips per month reveals an increase of approximately 118 trips per route per weekday (median increase of 1.7% of weekday route-level ridership) attributable to providing real-time information. Further refinement of the fixed effects model suggests that this ridership increase may only be occurring on larger routes; specifically, the largest quartile of routes defined by revenue miles of service realized approximately 340 additional trips per route per weekday (median increase of 2.3% per route). Although the increase in weekday route-level ridership may appear modest, on aggregate these increases exert a substantial positive effect on farebox revenue. The implications of this research are critical to decision-makers at the country’s transit operators who face pressure to increase ridership under limited budgets, particularly as they seek to prioritize investments in infrastructure, service offerings, and new technologies.     

Special issue: Importance of public transport

The transport demand in most major cities around the world can only be met with a high‐quality public transport system. The requirements on bus, rail, underground and tram systems are manifold with reliability and efficiency as the key factors. The service operating hours and the size of the network are often extended in order to serve the needs better. Further, most metropolitan areas are trying to provide more incentives for citizens to leave the car at home and use the local transit systems instead. The reasons are well known. Not only does a public transport system only make economical sense if it is well used, but most urban areas with a high car‐dependency face at least three major problems; safety, congestion, and pollution (noise and air pollution, land separation, etc.). It is generally recognised that to decrease car usage and to increase public transport usage a stick & carrot approach is needed. The London congestion‐charging scheme is an example since all revenues collected by the scheme are put into the improvement of bus and underground services.     

Planning and Evaluation of Passenger Ferry Service in Hong Kong

A predominant observation in Hong Kong is the continuous loss in ferry patronage. There are two main reasons for this: poor level-of-service and better competitors. New roads, bridges, and tunnels are serving the buses, and to some extent the railways; whereas the investment in ferry terminals is relatively at a lower level. On the one hand, there is no need to promote the ferries in a free market environment; but on the other hand, the ferries have the best safety record, can only relieve some traffic congestion and need water access that is one of the characteristics of Hong Kong. The goal of this paper is to design a planning approach combined with an evaluation procedure on how to make the best use of the existing water and pier resources in Hong Kong through the provision of commercially viable ferry services. The approach used covers the impact of future developments planning up to 2006 comprising all public transport modes in Hong Kong (heavy rail, metro, bus, and ferry). The planning tool is based on a newly developed multi-objective evaluation method in order to assess the ferry routes with scientific, practical, and simplified analyses for future use. This assessment is applied to the existing ferry routes and candidate routes and can also be carried out on an individual route basis or on a given set of routes. The objective functions set forth analytically in the evaluation method take into account the interests of the three participants: the passengers, the operators and the government. The proposed ferry network design formulation and the suggested new ferry routes will have a positive impact on changing the ferry system’s image in Hong Kong.