CEO: RapidPenang has no competition to speak of

TRANSIT received a copy of this statement from RapidPenang CEO Azhar Ahmad in response to our earlier letter about the Penang Public Transport Council and RapidPenang’s recent fare increase.

PUBLIC TRANSPORT: Penang bus service has no competition to speak of
2009/08/19

AZHAR AHMAD, Chief executive officer, Rapid Penang Sdn Bhd

WE are grateful for the constructive input on public transport in Penang from Moaz Yusuf Ahmad of the Association for the Improvement of Mass Transit (“Get operators involved, too” — NST, Aug 14).

Buses were introduced as public transport in Penang in 1925.

Since then, bus public transport has seen many changes in operators. but few of them had much success primarily because the fares were too regulated and there was little room for improvement.

After so many roadblocks to success, Rapid Penang was established on July 31, 2007. Since inception, we have faced many challenges but we persevered and continue to grow from strength to strength.

We are aware that anything to do with pricing, or in our case bus fare, is a sensitive issue.

However, we must accept that any improvement in the standard of living affects the cost of living. Quality comes at a price. [TRANSIT: The question there is, how can we work together to make the price reasonable?]

At Rapid Penang, we take quality seriously. Having become an ISO-certified company in June, we have embarked on an ambitious programme to continually improve our services and be the preferred public transportation service in Penang.

The cost of quality can be related to the following realities:

– Overhead expenditure, including support, enforcement and system resources (accounting for 40 per cent of total operating cost);

– Fuel costs (45 per cent); and,

– Preventive maintenance costs (15 per cent). [TRANSIT: We will have to find out more about these data. Hopefully RapidPenang will be willing to share their cost figures with us.]

These three factors already add up to 100 per cent and we have yet to consider amortisation of the capital outlay, depreciation and contingencies. [TRANSIT: Since Prasarana is the owner of the assets (the buses and presumably, the hubs and workshops, the amortization of capital – that is paying for the loans – and depreciation – lost value of the asset – should be Prasarana’s responsibility, not RapidPenang’s].

Over and above providing basic bus services, Rapid Penang has gone the extra mile by adopting the following measures:

– GPS tracking device on every bus to monitor strict scheduling.

– ICIS control room, which operates from 5.30am to 12.30am [TRANSIT: Better than RapidKL] to inform the public on bus arrival times at any bus stop in Penang, in addition to responding to incidents of breakdowns and dispatching rescue buses.

– Strictly observing all rules and regulations governing bus operations, including serving all routes, even low-ridership ones.

– Provide concession cards — OKU & Warga Emas — which offer discounts up to 50 per cent off the published fare and student vouchers that entitle the holder to unlimited use of Rapid Penang buses for RM30 per month. There’s also the Tourist Passport that gives seven days unlimited rides on Rapid Penang buses with other “value-added-ons” for RM20. This portfolio represents about 20 per cent of our ridership and is a loss leader. Soon to join this stable will be the Monthly Season Pass.

– WiFi buses along designated routes that offer free Internet connectivity for commuters.

– Maintaining an interactive careline (careline@rapidpg.com.my) and website (www.rapidpg.com.my) to stay in touch with members of the public.

It would not be fair to compare us with other operators as we are on a different dimension altogether.

Rapid Penang wears many hats as an employer, a good corporate citizen and a professional organisation. We mean business.

There is no point harping on our “competitors” because in reality, Rapid Penang has no real competitors. We certainly do not see one if it operates under the disconcerting Pajak System, which is a development liability and a catastrophe.

Our recent fare hike, effective Aug 1, was merely to support a sustainable bus public transport service. [TRANSIT: More details needed, please.]

Rapid Penang is ever committed to continually improving bus public transport service with a fair compensation package and reciprocal support from members of the public.

The last thing we want is to add to the financial burden of our commuters, but we just could not afford to operate to our full potential at the old fare rate structure.

We cannot agree more on the suggestion joining the Public Transport Council to exchange ideas and improve the overall public transportation system. Let us look at the bigger picture on continual improvement and endure a little pain now for a comfortable tomorrow.

TRANSIT Says:

We certainly can appreciate the efforts and enthusiasm of RapidPenang CEO Azhar Ahmad in pushing for a higher quality of service in Penang.

The indications of cost structures are interesting – intriguing, in fact – and deserve more attention. We can only hope that RapidKL would be as forthcoming with information about their current cost structures.

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