Why are express bus operators facing financial crises despite passenger increases?

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Express Bus Operators Face Financial Strain Despite Passenger Recovery

Express bus operators are experiencing significant financial difficulties, even with an 80% increase in passenger numbers, due to a confluence of escalating operational costs and systemic financial pressures. The recovery in passenger volume, while substantial and nearing pre-Covid-19 levels, has been insufficient to counterbalance the sharp rises in the cost of vehicles and essential parts, alongside new commission structures and payment delays imposed by ticketing systems.
Escalating Vehicle and Parts Costs

The financial strain on express bus operators is heavily influenced by a marked increase in the cost of acquiring and maintaining their fleets. Since the Covid-19 pandemic, the price of bus bodies has surged by 39%, and bus chassis prices have seen an even more significant rise of 44%. Furthermore, the cost of essential spare parts has increased by 25%. These substantial hikes in capital expenditure and maintenance costs directly impact the profitability of individual bus operations.
Driver Shortages and Operational Challenges

Compounding the issue of rising costs is a critical shortage of qualified bus drivers. Many Malaysian drivers are reportedly seeking employment abroad, particularly in countries like Singapore, where significantly higher salaries are offered. This exodus of drivers not only limits the operational capacity of existing bus companies but also potentially drives up labour costs as operators compete for a dwindling pool of available personnel.
Impact of Centralised Ticketing Systems and Delayed Payments

The widespread adoption of Centralised Ticketing Systems (CTS) by terminal managements, including major hubs like Klang, Shah Alam, Ipoh, and Larkin, has introduced further financial burdens. Operators are now required to pay a 10% commission on each ticket sold, averaging RM5 per ticket. This commission, coupled with delayed payments from both CTS and Online Ticketing Agents (OTAs) that can range from seven to 19 days, severely disrupts cash flow. The extended waiting period for ticket sale revenue hinders operators' ability to manage their capital effectively and meet their ongoing operational expenses.

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Why are express bus operators facing financial crises despite passenger increases?

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