Monday, April 16, 2007

Volvo service on a losing track

Volvo service on a losing track

Anil Kumar Sastry

Bangalore Metropolitan Transport Corporation runs up a loss of Rs. 1.89 cr.

# Average running cost per km is Rs. 50.68
# Average earning is Rs. 41.59

WITHOUT PROFIT: A losing proposition for Bangalore Metropolitan Transport Corporation. — FILE PHOTO

BANGALORE: After all that ballyhoo, it has emerged that Bangalore Metropolitan Transport Corporation (BMTC)'s Volvo service, introduced in January 2006, incurred a loss of Rs. 1.89 crore.

A senior BMTC official attributed it to the increasing traffic jams in the city, compounded by long waiting time at traffic signals.

Unlike in other buses, Volvo's engine cannot be turned off as the air-conditioner should be kept running. If there had been less traffic hold-ups, the corporation could have reduced the losses or could have even achieved the break-even, he said. The loss was recorded as of February 2007.

The average running cost of these buses per kilometre is Rs. 50.68 while the average earning per kilometre of Rs. 41.59.

As against the average loss of Rs. 9.09, the loss incurred on route no 335E is Rs. 4.34 and route no 356C is Rs. 7.47. The two routes cater to the employees of information technology industries at ITPL and Electronic City.

BMTC's decision to display commercial advertisements on the window panels of the Volvo buses has helped to reduce the losses to some extent. Since December 2006, BMTC is earning advertisement revenue of Rs. 9.72 lakh per month.

Its latest move to allow display of advertisements on LCD screens inside Volvo buses is likely to fetch more revenue.

The only solace for BMTC is that the quantum of operational loss on the IT corridor routes is less compared to that on others. Apparently, BMTC's mission to lure IT company employees towards these plush buses appears to have worked.

The first Volvo service was launched on January 16, 2006 between Kempegowda Bus Station and Electronic City (route no 356C) and at present, six buses operate on this route.

This was followed by services between Kempegowda Bus Station and Kadugodi (ITPL, route no 335E) with 12 buses, Kempegowda Bus Station and JP Nagar VI Phase (route no V-2, four), Shivajinagar and Kadugodi (route no 333P, two), Banashankari and ITPL (route no 500L, two), Kempegowda Bus Station and Bannerghatta National Park (route no 365, four), Kempegowda Bus Station and Narayana Hrudayalaya (route no 356M, two), Kempegowda Bus Station and Bhuvaneshwarinagar (route no V-45H, two), Vijayanagar and ITPL (route no 500K, four), Kempegowda Bus Station and Parangipalya (route no 340N, four) and Kempegowda Bus Station and Yelahanka Satellite Town (route no 402B, four).


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