The effect of contract renewal and competitive tendering on public transport costs,subsidies and ridership

In this paper, we aim to estimate the effect of contract renewal as well as competitive tendering on public transport costs, subsidies, and ridership. More specifically, we examine to what extent (multiple) contract renewals and introduction of competitive tendering for long-term public transport contracts affect ridership, operational costs and subsidies in concession areas governed by public transportation authorities from 2001 until 2013 in the Netherlands. Our identification strategy improves on the literature as we are able to control for all time-invariant unobserved factors, such as network and area characteristics by using panel data. We show that when renewing long-term contracts, operational costs are reduced by at least 10%, whereas subsidies fall even stronger. For contracts that are renewed at least twice, the reduction in costs is even more substantial and in the order of 16%. We find that the effect of competitive tendering is completely absent, suggesting that the threat of competitive tendering is sufficient in a market where the majority of concessions is competitive tendered. Contract renewal not only reduces costs and subsidies, but simultaneously increases public transport ridership by 7.7%. Furthermore the vehicle-hours elasticity of operational costs is 0.40, pointing to strong economies of density. The geographical scale elasticity of operational costs is around one, which indicates constant returns to scale with respect to the geographical size of the concession area. This suggest that the current size of the Dutch concession area is optimal with respect to costs.     

Examining the benefits of using bio-CNG in urban bus operations

Public service fleets offer an attractive option for introducing new renewable fuels on a large scale, which allow for the reduction of both greenhouse gas emissions and exhaust air pollutants. This study examines the use of biomethane (bio-CNG) and compressed natural gas for part of the bus fleet in Dublin, Ireland. The emissions produced from the 2008 fleet based at one of the city’s seven bus depots are compared to use of new diesel and bio-CNG buses. The optimum feedstock for bio-CNG production in Ireland was then investigated, as well as the quantity of feedstock needed to produce the required bio-CNG to fuel the bus fleet examined. As expected the results showed a substantial decrease in all exhaust emissions from the use of bio-CNG buses compared the 2008 fleet. Grass silage was chosen as the optimum feedstock for production of bio-CNG in Ireland.     

Integrated optimization of bus priority operations in connected vehicle environment

Most previous works associated with transit signal priority merely focus on the optimization of signal timings, ignoring both bus speed and dwell time at bus stops. This paper presents a novel approach to optimize the holding time at bus stops, signal timings, and bus speed to provide priority to buses at isolated intersections. The objective of the proposed model is to minimize the weighted average vehicle delays of the intersection, which includes both bus delay and impact on nearby intersection traffic, ensuring that buses clear these intersections without being stopped by a red light. A set of formulations are developed to explicitly capture the interaction between bus speed, bus holding time, and transit priority signal timings. Experimental analysis is used to show that the proposed model has minimal negative impacts on general traffic and outperforms the no priority, signal priority only, and signal priority with holding control strategies (no bus speed adjustment) in terms of reducing average bus delays and stops. A sensitivity analysis further demonstrates the potential of the proposed approach to be applied to bus priority control systems in real‐time under different traffic demands, bus stop locations, and maximum speed limits. Copyright © 2016 John Wiley & Sons, Ltd.     

Some promising innovations in taxicab operations

Several shared-ride passenger transportation services which could be offered by taxicabs are currently prohibited in U.S. cities by state or local regulations. Although relaxation of these regulations has been advocated on numerous occasions, little regulatory change has occurred to date. Moreover, the taxicab industry has rarely been considered as a potential provider for publicly subsidized transportation services. This paper discusses several promising innovations in taxicab service provisions and subsidy mechanisms which have been implemented or proposed recently in U.S. cities. The paper argues for more well-designed experimentation with such innovations as a means of stimulating greater interest on the part of planners, policy-makers, regulators, and public transportation operators in broadening the role of taxicabs in urban transportation.     

A cost-competitiveness analysis of charging infrastructure for electric bus operations

This study investigates the cost competitiveness of different types of charging infrastructure, including charging stations, charging lanes (via charging-while-driving technologies) and battery swapping stations, in support of an electric public transit system. To this end, we first establish mathematical models to investigate the optimal deployment of various charging facilities along the transit line and determine the optimal size of the electric bus fleet, as well as their batteries, to minimize total infrastructure and fleet costs while guaranteeing service frequency and satisfying the charging needs of the transit system. We then conduct an empirical analysis utilizing available real-world data. The results suggest that: (1) the service frequency, circulation length, and operating speed of a transit system may have a great impact on the cost competitiveness of different charging infrastructure; (2) charging lanes enabled by currently available inductive wireless charging technology are cost competitive for most of the existing bus rapid transit corridors; (3) swapping stations can yield a lower total cost than charging lanes and charging stations for transit systems with high operating speed and low service frequency; (4) charging stations are cost competitive only for transit systems with very low service frequency and short circulation; and (5) the key to making charging lanes more competitive for transit systems with low service frequency and high operating speed is to reduce their unit-length construction cost or enhance their charging power.     

Modeling schedule recovery processes in transit operations for bus arrival time prediction

Many existing algorithms for bus arrival time prediction assume that buses travel at free‐flow speed in the absence of congestion. As a result, delay incurred at one stop would propagate to downstream stops at the same magnitude. In reality, skilled bus operators often constantly adjust their speeds to keep their bus on schedule. This paper formulates a Markov chain model for bus arrival time prediction that explicitly captures the behavior of bus operators in actively pursuing schedule recovery. The model exhibits some desirable properties in capturing the schedule recovery process. It guarantees provision of the schedule information if the probability of recovering from the current schedule deviation is sufficiently high. The proposed model can be embedded into a transit arrival time estimation model for transit information systems that use both real‐time and schedule information. It also has the potential to be used as a decision support tool to determine when dynamic or static information should be used.     

Enhanced bus operations: The Curitiba model and its applicability to China

Buses will remain the backbone of public transport systems for some time to come because of their lower cost and higher flexibility in relation to rail transport. However, buses are perceived as being an inferior mode of public transport and do not offer as much carrying capacity as rail transport. Following the Curitiba model, this paper looks at the potential for transferring some of the key advantages of rail transport to bus operations. This involves transforming bus stops into enclosed stations, with ticket purchase and/or checking in the station and at‐grade access to vehicles. It also involves the extensive use of bus lanes. The potential contribution of transport telematics is looked at, in particular the use of smartcards for payment in a closed fare system. The potential role of the Curitiba model for China is assessed in the context of toll road construction.     

Autonomous and conventional bus fleet optimization for fixed-route operations considering demand uncertainty

Transportation - The emerging technology of autonomous vehicles has been widely recognized as a promising urban mobility solution in the future. This paper considers the integration of autonomous...     

A fuzzy multicriteria model to evaluate the privatization of the public bus operations

A double model based on fuzzy synthetic decision and a fuzzy multicriteria decision is presented for this study. In a basic level decision, we use a fuzzy synthetic decision to reduce the sub-criteria calculation work. In a higher level decision, the approximation reasoning allows the decision maker to make his best choice. These methods are more in accordance with the thinking processes of the human mind when complex issues are involved. Therefore, this paper will use a fuzzy linguistic approach, instead of the traditional approach to avoid the interference of the numerical estimates for weight and performance of alternatives. In the end, a heuristic algorithm for the evaluating process is developed and demonstrated in a case study.     

Competitive tendering versus performance-based negotiation in Swiss public transport

The purpose of this study is to assess differences in the levels of cost efficiency of bus lines operated under competitively tendered contracts and performance-based negotiated contracts. Following the revision of the Swiss railways act in 1996, regional public authorities were given the choice between two different contractual regimes to procure public passenger transport services. We directly compare the impact of competitive tendering and performance-based negotiation by applying a stochastic frontier analysis to the complete dataset of bus lines (n = 630) operated by the main Swiss company (Swiss Post) at the same time (in 2009) throughout the country. The overall results show that the differences in the levels of cost efficiency between the two contractual regimes are not significant. Our findings are in line with recent evidence of cost convergence between competitive tendering and performance-based negotiation, and suggest that the practice of using both contractual regimes is challenging for the operators in terms of competitive pressure. The threat of competitive tendering may have a disciplining effect on negotiation since it prevents bus companies from bargaining inadequate rents and inducing asymmetric information advantages.     

The effects of non-contingent free bus tickets and personal commitment on urban bus ridership

To compare the effects of free rides and commitment to a performance goal on increasing bus ridership in an urban setting, 83 non-bus riding automobile drivers were exposed to one of the following conditions. (1) Control where route and schedule information were provided. (2) Commitment, where subjects agreed to ride the bus twice a week during the treatment period. (3) Free Tickets, where an unlimited supply of free bus tickets were provided. (4) Free Tickets Plus Commitment, where the free transit and commitment conditions were combined. While there were no systematic differences between the experimental conditions, each of them produced significantly higher levels of ridership than the no-treatment control group during the 4 week treatment period and two subsequent follow-up periods. These results suggest that both free rides and agreement to a specific performance goal can overcome many of the obstacles which prevent individuals from initiating and maintaining regular patterns of bus ridership.     

湖北黄冈公交车罢运调查

11月3日,持续3天的"黄州全城无公交"终于结束--110辆公交车恢复运营. "一个承担40万市民营运任务的公共交通,居然停运3天,这简直难以想像,它暴露了公共交通市场化后带来的问题,这是一个活生生的教训."11月2日,湖北省建设厅城市建设处一名负责人如此评价.     

The role of the discount rate in tendering highway concessions under the LPVR approach

Flexible-term highway concessions are becoming quite popular around the world as a means of mitigating the traffic risk ultimately allocated to the concessionaire. The most sophisticated mechanism within flexible-term concession approaches is the least present value of the revenues (LPVR). This mechanism consists of awarding the concession to the bidder who offers the least present value of the revenues discounted at a discount rate fixed by the government in the contract. Consequently, the concession will come to an end when the present value of the revenues initially requested has been eventually reached. The aim of this paper is to evaluate the effect that the discount rate established by the government in the bidding terms has on the traffic-risk profile ultimately allocated to the concessionaire. To analyze this effect, a mathematical model is developed in order to obtain the results. I found that the lower the discount rate the larger will be the traffic risk allocated to the concessionaire. Moreover, I found that, if a maximum term is established in the contract, the lower the discount rate, the less skewed towards the downside will be the traffic-risk profile allocated to the concessionaire.     

Genetic algorithms in bus network optimization

This paper focuses on a new method to compute fitness function (ff) values in genetic algorithms for bus network optimization. In the proposed methodology, a genetic algorithm is used to generate iteratively new populations (sets of bus networks). Each member of the population is evaluated by computing a number of performance indicators obtained by the analysis of the assignment of the O/D demand associated to the considered networks. Thus, ff values are computed by means of a multicriteria analysis executed on the performance indicators so found. The goal is to design a heuristic that allows to achieve the best bus network satisfying both the demand and the offer of transport.     

Optimal feeder bus routes on irregular street networks

The methodology presented here seeks to optimize bus routes feeding a major intermodal transit transfer station while considering intersection delays and realistic street networks. A model is developed for finding the optimal bus route location and its operating headway in a heterogeneous service area. The criterion for optimality is the minimum total cost, including supplier and user costs. Irregular and discrete demand distributions, which realistically represent geographic variations in demand, are considered in the proposed model. The optimal headway is derived analytically for an irregularly shaped service area without demand elasticity, with non‐uniformly distributed demand density, and with a many‐to‐one travel pattern. Computer programs are designed to analyze numerical examples, which show that the combinatory type routing problem can be globally optimized. The improved computational efficiency of the near‐optimal algorithm is demonstrated through numerical comparisons to an optimal solution obtained by the exhaustive search (ES) algorithm. The CPU time spent by each algorithm is also compared to demonstrate that the near‐optimal algorithm converges to an acceptable solution significantly faster than the ES algorithm.     

A model of stoppings on urban bus routes

The amount of time required to pick up and discharge passengers is an important issue in the planning and modeling of urban bus systems. Several past studies have employed models of this component of bus travel time which are based, in part, on a model of the number of stoppings the bus makes to pick up or discharge passengers. Most past versions of this model have assumed that expected demand does not vary from stop to stop or from trip to trip, but that the number of passengers demanding service at any given stop during any given trip follows a Poisson distribution. An alternative model is derived, based on the assumption that expected demand varies among stops and times of day but is fixed from day to day at any given stop and time of day. Boarding and alighting survey data are used to verify that the “average-demand” Poisson model consistently overestimates the number of stoppings and to calibrate an approximate version of the alternative model. A stop-spacing optimization model previously developed by Kikuchi and Vuchic is reevaluated using the alternative stopping model in place of the average demand model used in the original version. The results are found to be considerably different, thus indicating that transit route optimization models are sensitive to the way in which stopping processes are modeled.     

The economics of bus deregulation in Britain

This paper reviews some of the arguments which have been put forward on the economics of bus deregulation, particularly the paper by Gwilliam and others. It argues that the experience of road haulage licensing is relevant. The evidence there suggests that liberalization has not had the adverse effects that many predicted and that in most respects one could expect bus deregulation to have no less favourable consequences. The main difference between buses and road haulage is over how far bus drivers might revert to the old practices of the 1920s of chasing, tailing, etc. which were said at the time to be a major cause of consumer dissatisfaction. The paper reviews the economics of some of these practices and suggests which might be discounted and which need further attention.     

Short-term post-earthquake bus transit planning in Managua

In December 1972 an earthquake hit Managua, Nicaragua, killing 5,000 inhabitants, while wounding 20,000 persons and destroying its core area of 13 square kilometers. The earthquake also seriously disrupted the bus transit system. Bus transit patronage fell as a result of the loss of population of 144,000 persons who moved temporarily out of the city, while costs rose appreciably as both round trip bus distances and the proportion of the trips on unpaved roads doubled with respect to pre-earthquake levels. By September 1973, ten of the thirteen bus companies were on the verge of bankruptcy and were demanding from the regulatory body stiff increases in fares.This paper presents analyses and recommendations for improving the short-term efficiency of bus routes in Managua by applying planning techniques suited to the data availability problems of developing countries.In view of the lack of cost data for the bus routes, a cost analysis was conducted; Jan de Weille's cost factors were adapted to Nicaragua to portray the near bankrupt condition of most routes. These cost factors were verified by means of selected interviews with the private transit entrepreneurs.Next, a simple patronage prediction model was developed which related patronage for a route to the population and employment served by the route. This simple patronage model was then applied to redesign the bus routes of Managua. A policy of bus route redesign coupled with the paving of city streets along the bus routes is shown to have sufficed in avoiding fare increases. Finally, the paper reviews the bus transit regulatory setting and develops some recommendations for its improvement.Adjunct Associate Professor of the Catholic University of America. This study was conducted while the author was stationed in Nicaragua as a consultant to Harvard Development Advisory Service.     

Performance-based quality contracts in bus service provision

Institutional reform of the bus sector is a topical discussion item in a number of countries at present. A specific focus is on ensuring a value for money (VM) regime to identify the benefits to society associated with each dollar of subsidy support from government. This paper promotes the position that a performance-based contracting (PBC) regime offers the best prospects of achieving a system-wide VM outcome. It proposes a reward system for bus operators that combines payment for delivering a minimum level of service (MSL), that meets government community service obligations, plus an incentive regime that rewards operators for patronage increases (above MSL patronage levels). The patronage incentive is based on expected user and external benefits deriving from service improvements and patronage increases. Cost benchmarking at relevant best practice levels is proposed as essential to ensure remuneration is based on efficient cost levels. The paper argues that a PBC approach is consistent with maximising social surplus from public transport provision across a geographic area, for any given budget constraint and regulatory imposed minimum service levels. The main alternative, competitive tendering (CT), is argued to be less attractive than PBCs in terms of securing the maximum social surplus to the community, given the total amount of subsidy support available, although CT is an appropriate non-compliance condition. This paper is a companion to Hensher and Houghton [Hensher, D.A., Houghton, E., Performance-based contracts for the bus sector: delivering social and commercial value for money, Trans. Res. B, in press] that details the economic framework and an application of PBCs.