SINGAPORE May 21 Singapore said it would
restructure the bus sector to a "government contracting model"
to encourage more competition and ease operators' capital
expenses, a move that could lead to improved service to the
The measures will kick off from the second half of this
year, Singapore's Land Transport Authority (LTA) said in a
statement on Wednesday.
The overhaul comes as Singaporeans complain of soaring
living costs and an overcrowded transport system in one of the
world's most densely populated countries. Singapore discourages
car ownership through hefty taxes, leaving most commuters to
rely on trains and buses.
Its two bus operators - Comfortdelgro Corporation Ltd's
SBS Transit Ltd and SMRT Corporation Ltd
- have reported losses in their core bus businesses,
burdened by the high cost of operations.
"As part of the new bus industry model, the government will
own all bus infrastructure such as depots as well as operating
assets such as buses and the fleet management system," the LTA
"This will lower the barriers of entry to the market,
attract more bus operators and facilitate the transit from an
incumbent to a new operator should the incumbent not win the
tender upon contract expiry."
Market talk of a new operating model has pushed up shares of
SMRT by 41 percent over the past month, while SBS Transit has
gained 19 percent and Comfortdelgro has risen 11 percent.
(Reporting by Anshuman Daga; editing by Jane Baird)