Thredbo 99th International Conference on Competition

and Ownership in Land Passenger Transport

J. Manuel Silva Rodrigues

Lisbon, 5th September, 2005

How will mobility providers evolve

in face of a growing competitive environment

General points about the transport system in

Lisbon Metropolitan Area

LisbonLisbon

Source: AML, AMTL, INE, GEP-MOPTCSource: AML, AMTL, INE, GEP-MOPTC

2.7 million inhabitants

2,963 km2 area

18 councils

1.4 million daily commuting journeys

Main features

LisboaLisboaPublic operators (2004)

Supply: 14,731 million passenger places x km

Demand: 3,151 million passengers x km

Occupation rate: 21 %

Annual revenues: 220 M€

Operational costs / revenues: 47 %

Transport system in "AML" (Lisbon

Metropolitan Area)

16 operators, including 5 public

companies (Carris, Metro,

CP Lisboa, Transtejo e Soflusa)

5 modes (bus, tramway, subway,

train and boat)

Source: AML, AMTL, INE, GEP-MOPTCSource: AML, AMTL, INE, GEP-MOPTC

1991 2001

1,31

1,38

Commuting journeys

Million / day

1991 2001

51

37

Public transport

Percentage

1991 2001

26

45

Private transport

Million journeys / day

Public Transport use has decreased in favour

of private car use.

Lisbon Metropolitan Area

(217) 223 (-459) -478

(-242) -255

Revenueswithoutcompensatorysubsidies

Costs Resultsbeforecompensatorysubsidies

Lisbon Metropolitan Area - Public Operators

(Year 2002) Year 2004 (E)

227

88

Averageannualamortizations

Averageannualinvestment

Values in Million €Values in Million €Source: CompaniesSource: Companies

266

2002 2003 2004 (E)

217 197

Values: Million €Values: Million €Source: CompaniesSource: Companies

Totalfinancingneeds

Attributedfunds(compensatorysubsidies,capital provison)

Uncoveredneeds(Additionalindebtedness)

Coveredratio

2002

34% 33% 22%

508

171

337

2003

481

160

321

2004

452

100

352

Lisbon Metropolitan Area - Public Operators

35%

2002 2003 2004

2.422

2.749

3.278

Values: Million €Values: Million €Source: CompaniesSource: Companies

A growing indebtedness is noted…

Lisbon Metropolitan Area - Public Operators

2002 2003 2004

162

- 90

- 345

… with a resulting degradation

in operators' equity capital.Values: Million €Values: Million €Source: CompaniesSource: Companies

Lisbon Metropolitan Area - Public Operators

The Public Transport system is facing 3 distinct issues,

but are interdependent.

Efficiency

Demand

Financing

Efficiency

There is a clear

efficiency

deficit in

public operators

of the

transport system.

Operational cost / passenger x km, adjusted by Purchasing Power Parity (euro cents)

In brackets, the occupation rate (%)

Values: 2002; a) 2001

Source: Companies

Bus

London

Rome

Madrid

Lisbon

Barcelona

Paris

a)

Demand has

continuously

decreased in

recent years.

Source: Carris, Metro

Demand

Passengerjourneys(million)

Years

Financing

The financing gap results from, either a smaller financial effort

asked of passengers…

Average revenue / passenger x km, adjusted by PPP – 2002 (euros)

Modes: Bus + Subway

Source: Companies

London Paris Barcelona Average Lisbon Madrid Rome

Financing

Average revenue / passenger x km, adjusted by PPP – 2002 (euros)

Modes: Bus + Subway

Source: Companies

… or the reduced level of subsidies attributed to

the operators

Paris Rome Barcelona Average Madrid Lisbon London

Carris.Which strategy?

89 lines(+ 8 Night Bus Network lines)

5 lines

4 lines

Route length (one way): 672 km

Total lines extension: 2,113 km

Number of routes: 106

Buses: 794

Tramways: 58

4,204 4,170 4,158 4,074 3,856

Supply (million passenger place kilometres)

2000 2001 2002 2003 2004

357 312 300 277 257

Demand (million passenger journeys)

2000 2001 2002 2003 2004

Carris55%

Metro45%

Carris61%

Metro39%

- 8 %

- 14 %

Mesures •Carris Supply

•Service and Image

•Fleet

•Maintenance

•Work rules

•Purchase and stocksmanagement•Organisation

•Fare system

•Carris-ML Supply–

•Carris-ML Cooperation–

•Commercial speed

•Car dissuasion

•Debt restructuring

•Assets

Debt assumption

Description

Issues dependingexclusively on Carris

Issuesdependingonarticulationwith otherentities

1

2

3

4

5

6

7

8

9

10

11

13

14

Cu

rren

t accou

nt

Historic account

12

•Incremental optimization of supply and redesigning of network, with a selectiveremoval of duplicated supply; exchange of subway operation in its less efficientperiods; more connections with subway lines and schedule synchronization,feeding subway stations with Carris lines.•Real time information. Information through mobile phones messages.

•Bus fleet renewal, with 408 new buses until 2006, decreasing the average bus ageto 5.4 years.

•Redesign maintenance procedures, more polyvalency and progressiveautonomisation aiming at outsourcing of 1/3 of activities.

•Work schedules flexibility and measures aiming to reduce the level ofabsenteeism.•Renegociation of contracts, redesigning stocks management, electronic auctions.

•Creation of business units, redesigning procedures, maintaining the reduction ofstaff, namely in central areas.

•Redesigning the fare system and alignment with other european cities, resulting ina net increment of 11 %.

•Removal of duplicated supply, more connections between modes.

•Searching for mutual opportunities.

•Reserved bus lanes increase, removal of gaps in existing bus lanes network (allowing continuity) and police enforcement on parking and circulation on the bus lanes.

,

•Restricting car circulation and optimisation of parking infrastructures.

•Alternative sources of financing with lower costs.

•Selling unnecessary assets.

•Assumption of historic debt by shareholder.15

Carris – Restructuration program

The restructuring in progress has brought

visible results

Redesign the network- Why?

Lisbon has undergone a structural evolution,

in recent decades, with consequences in mobility,

which justifies a redesigning of the network.

In recent decades, we observed a significant loss

of resident population in the city, …

Evolution of resident population (Percentage)

1981 - 1991 1991 - 2001

Lisbon City

"AML" North

"AML" South

Total "AML"

"AML" - Lisbon Metropolitan AreaSource: TIS.pt

… the expansion to new areas, …

Total journeys per area (origin or destination)

Area

Source: TIS.pt

… and the movement of jobs towards the surrounding councils.

Evolution of employed population (%)

Council Employment in 20001991 to 1995 1995 to 2000

Source: TIS.pt

The development of the road infrastructure

also contributed to profound changes in the mobility, …

Journeys to Lisbon made by car (%)

Conclusion of motorway A5

“Vasco da Gama” bridge

Year 1991 Year 2001

Source: TIS.pt

… as in the expansion of subway network.

Today

Redesign the network- How?

COMPLEMENTARITY - with rail and subway networks

SERVICES DIRECTED TO MODAL CHANGE - services to the residencial areas (Bairros)

SEGMENTATION - for those who prefer direct connections

- for those who prefer speed and frequency

1 – Rail and Subway1 – Rail and Subway

CA

RR

IS n

etw

ork

4 Hierarchical levels4 Hierarchical levels

2 – Trunk network (Bus and Light Rail)2 – Trunk network (Bus and Light Rail)

complementary of 1st level network

3 – Intermediate network3 – Intermediate network

supply more service to the lesser supplied areas of the city

4 – Local Service network4 – Local Service network

feed the 1st level network and serve the main services in each quarter

Models to reach:

Trunk network Trunk network

(Rapid)(Rapid)

Intermediate Intermediate networknetwork

Local Service Local Service networknetwork

Frequency

Distance between stops

Desirable speed

10 / 6 600 21

Links to 1st level network

(trips/hour) (metre) (km / h) (number)

3

8 / 3

6 / 2

300

400

300

16

18

16

1 / km

1 / km

1 / km

2

Trunk network Trunk network

(Normal)(Normal)

REDESIGNING CARRIS NETWORKNetwork coverage

TrunkSecondaryLocal