Should Canadian governments subsidize intercity bus service?
Wednesday, October 21st, 2009 - 3:48 pm
One topic of discussion at this week’s Vancouver meeting of the Transportation Association of Canada (TAC) will be the continuing call from the country’s intercity bus operators for government subsidies to rural and small town services.
The four-day TAC 2009 Annual Conference and Exhibition wraps up tomorrow with a meeting of federal and provincial transportation ministers. (October 18-21 at the Hyatt Regency Hotel and Fairmont Hotel Vancouver)
On Sept. 3, 2009, Greyhound Canada, the country’s largest intercity operator, served notice that it would cease operations in Manitoba on Oct. 2-09 and in Northwestern Ontario on Dec. 2-09. It later agreed to continue operating in Manitoba, following private negotiations with Manitoba Transport Minister Ron Lemieux. The company had previously insisted it needed $15 million in federal and provincial subsidies to cover operating deficits on unprofitable routes in those areas. Lemieux has stated no money has been promised to Greyhound (yet).
Greyhound says other routes, many of them in Western Canada, are also unprofitable and subject to possible abandonment.
Don Haire of the Canadian Bus Council yesterday outlined some of the issues in an online column for the Globe and Mail: Canada’s broken passenger-bus system must be overhauled.
Greyhound, based in Dallas, TX, was acquired by British transportation conglomerate FirstGroup in 2007 when it took over Laidlaw. During FirstGroup’s first full year of ownership, Greyhound recorded a profit of $91.7 million USD against revenues of $1.1 billion. FirstGroup, which has total annual revenues of £6.2 billion ($10.7 billion CAD), recently introduced the Greyhound brand in the UK. (Sources: Winnipeg Sun, 2009-09-17, “Greyhound delays halt“; Greyhound press release; FirstGroup PLC 2009 Annual Report)
