Improving the Urban Public Transport in Developing Countries: The Design of a New Integrated System in Santiago de Chile Antonio Gschwender Thredbo September 2005 Lisbon, Portugal

2 Santiago de Chile Modal split (motorised trips) Public transport in 2003 –Buses 380 lines, average length 60km 8,000 buses 4,000 private “companies” No operational subsidy Bad service –Metro: good service (fast, reliable, clean)

3 Diagnosis of the Bus System Negative aspects –On-the-street competition High accident risk Unpredictable waiting times –Lack of cleaning and preventive maintenance –Routes designed to compete with other bus lines and metro –Institutional design Absence of Transport Authority: attributions divided into many public bodies Almost no participation of the authority in the planning of the system

4 Diagnosis of the Bus System Positive aspects –High frequencies Low waiting times –High routes density Low walking times –Low transfers Due to overlapping of many long routes... and fare structure: ”pay each time you board” –Positive aspects should be maintained

5 Main Aspects of the Proposed New System New routes structure –Three complementary networks Metro Main bus routes Feeder and local bus routes

6 Main Aspects of the Proposed New System New fare structure and ticketing system –Integrated fare Bus and metro Reduced (zero) transfer fare –Contactless smartcard Only paying device Already used in the metro (1,4 million in 2004)

7 Main Aspects of the Proposed New System Transport authority externalises: –Operation of the buses –Finance administrator sells tickets administrates revenues provides ticket-reading machines –Information manager manages operational information generates operational reports users’ information

8 Main Aspects of the Proposed New System New property structure for the bus industry: several big companies –Main routes 5 tendering units Some 500 buses each unit –Feeder and local routes 10 local areas = 10 tendering units Some 200 buses each unit –Maximum 4 concessions per operator

9 Main Aspects of the Proposed New System Financial balance –No operational subsidy And fares cannot rise –New costs Ticketing system Information manager Infrastructure in transfer points –Reduction in bus operation costs Better match between demand and capacity (coordination between routes) –Fares are a result of the tenders 0.45 EUR estimated average adult fare

10 Additional Description of The Proposed New System Buses –18m articulated buses introduced –Fleet: 4,500 vehicles (Metro network is doubled) 1,600 new low floor/entrance –Euro III emission norm

11 Additional Description of The Proposed New System Infrastructure plan: segregated busways (14km), transfer stations, etc. –Cost: 210 million EUR 25% publicly financed; 75% private investment charged to users’ fares Yearly cost of the system –570 million EUR: fares revenue 43% main bus routes 14% local and feeder buses 32% metro 5.5% infrastructure 5.5% finance adm. and information manager

12 Final Comments Current situation –Design of the plan began in 2001 –Bus operation tenders Awarded in January 2005 Between 2 and 8 offers per tender unit Old and new (foreign and Chilean) operators –Finance administrator Awarded in April 2005 –Information manager Not awarded yet –Implementation Begins in October 2005 Finish by the end of 2006

13 Final Comments Change in the whole bus system –Political dimension Already tendered services (since 1991) Very bad public opinion about current bus system Successful experiences in other Latin-American cities (e.g. Bogotá) –Technical dimension Data availability Modelling capacity: Joint design of 160 lines in a 5.4 million inhabitants city –Design model –New bus routes: heuristics –New frequencies: min Cop+Cusers Knowledge of the particular situation

14 Final Comments No strong political figure promoting and defending the plan over all its steps –Together with unclear institutional design: problems Competition existed in bus operation tenders –Financial risk of the bus operators was reduced by several mechanisms Massive introduction of smartcard was attractive for banks Transfers increased from 0.2 to 0.8 per trip

15 Final Comments Some future challenges –Transport authority? –Congestion-free infrastructure for the buses –Extension of integrated fare to other modes –Travelcards? –Product differentiation? (price-quality)

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Improving the Urban Public Transport in Developing Countries: The Design of a New Integrated System in Santiago de Chile Antonio Gschwender Thredbo September 2005 Lisbon, Portugal

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19 Fare Structure

20 Additional Description of The Proposed New System Financial risk of the bus operators –Reduced by: Minimum income guaranteed: between 85 and 60% Patronage semi-guaranteed: only 10% of the variation is transferred to operator Concession period can be extended up to 24 months if income is low Revenue adjustments in case of patronage changes due to commercial speed variations Compensation fund: assures payment in first months and if drops in the demand occur If fares reach an upper limit, measures to rationalise the use of car will be introduced

21 Additional Description of The Proposed New System Infrastructure plan –14km of new segregated busways (11km already exist) –2 big interchange stations –35 smaller transfer stations –Road surface and geometric improvements in 63km of main roads –2 strategic road connections –Improvements of 5,000 busstops –Cost: 210 million EUR 25% publicly financed 75% private investment charged to the users’ fares

22 Additional Description of The Proposed New System Awards and penalties scheme –Income generated by the penalties is returned to the operators (awards) Operators’ payment adjustment –Mathematical formula (production factors), as before –Impacts users’ fare Avoid need of legal changes Avoid intensive requirements of new infrastructure

23 Santiago de Chile Motorisation rate –1977: 80 cars per 1,000 inhab –2001: 148 cars per 1,000 inhab 10.2 million daily motorised trips Modal split 2001: –36% walking –26% bus –24% car –4% metro –4% taxi and shared-taxi –6% other modes 1,600 million trips in public transport in a year (2003) –290 yearly trips per inhabitant in PT

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