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Bus makers eye PPP model for growth

autos Updated: Mar 18, 2012 20:54 IST
Manu P Toms
Manu P Toms
Hindustan Times
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The bus industry that has been in a lull after the Jawaharlal Nehru Urban Renewal Mission bonanza of 15,000 orders, is awaiting another booster dose. Manufacturers are looking at the evolving public-private partnership (PPP) model bus transport systems in various cities with a great interest.


Under the PPP model, private operators will own, operate and maintain buses, while public transport authorities will pay lease charge on per-kilo metre basis.

This model is already working in a few cities including Delhi, Jaipur, Chandigarh, Indore, Pune and some cities in Uttar Pradesh. The tender-driven orders for buses from cash-strapped state transport bodies are generally small. Entry of private players will obviously lead to greater demand for buses.

“Either public transport undertakings should be able to buy enough buses they need or should take buses on lease from private players,” said Ravi Pisharody, president, commercial vehicles, Tata Motors. “Given the huge requirement for public transport, private players can play a role. But it will take at least 3-4 years to mature. The PPP model is in its early stage now.”

“The PPP is working very well in long distance travel. It will attract private players into city segment as well. Six to eight cities have adopted this model. But it is in the process of evolution,” said Akash Passey, chairman, Volvo Buses India.

“This is going to be the model for future. It is already in practice in Delhi,” said transport expert SP Singh, senior fellow Indian Foundation for Transport Research & Training. “Delhi Transport Corporation has made 17 transport clusters and five are already operational. They target to take on lease 16,000 buses. UP is also trying this model. The state government has floated tenders.”

More than a dozen players are vying for a pie in the bus industry. The medium and heavy bus segment showed flat growth this fiscal with sales at 43,177 till February and light passenger carriers including mini buses and vans showed 9% growth at 43,477 units.

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