At least five new players eye latest bus tender

British-based Go-Ahead, which launched its Singapore operations at the start of the month, is expected to compete in the next tender exercise, which closes on Oct 6.
British-based Go-Ahead, which launched its Singapore operations at the start of the month, is expected to compete in the next tender exercise, which closes on Oct 6.ST PHOTO: AZMI ATHNI

Foreign, local parties likely to face current operators for Seletar package of 26 routes

Even as the island's fourth public bus operator Go-Ahead Singapore began its services earlier this month, commuters will see the debut of more new players down the road.

Interest in the third and latest government bus tender, called in June, is strong with at least five companies and consortiums - all new to the local public bus industry - looking to throw their hats into the ring.

They are Australia's Busways, Singapore's Woodlands Transport, Britain's National Express and two consortiums, Kumho Buslines-Tian San Shipping, and Travel GSH- Jiaoyun Group, The Straits Times has learnt.

Travel GSH and Tian San are local firms, while Kumho is from South Korea and Jiaoyun from China.

The potential bidders, with the exception of National Express, have taken part in previous tenders, making this their second or third tries.

They are up against SBS Transit, SMRT, Tower Transit and Go- Ahead, which have expressed interest in competing for the Seletar tender package, comprising 26 routes.


Companies will want to come in early to 'exercise' their bids, and get themselves familiar with the local market.

DR LEE DER HORNG, National University of Singapore transport researcher.

National University of Singapore transport researcher Lee Der Horng expects that there could still be more competitors. He told The Straits Times: "Since the industry has completely moved into the bus contracting model, we can expect more (bus) contracts to be released in the future. Companies will want to come in early to 'exercise' their bids, and get themselves familiar with the local market."

On Sept 1, the public bus industry was restructured to a contracting model, in which bus routes are tendered out to operators in packages. All bus assets and infrastructure are owned by the Government, which pays winning bidders a fee to run the services.

Commuters can expect more reliable services as the operators have to meet standards, failing which they can be penalised financially. If they do well, they will be given monetary incentives.

While three bus packages have been put up for tender, with two awarded, there are 11 others currently run by incumbents SBS Transit and SMRT. Their contracts range in durations of between two and 10 years, and these packages will be put up for tender as they expire.

For the third tender, Dr Lee predicts that price will be one of the important factors. Tower Transit won the first tender, the $556 million five-year Bulim package, while Go-Ahead clinched the Loyang deal for $497.7 million.

Go-Ahead's tender offer was the lowest among the eight short-listed bidders in that round, and the Land Transport Authority (LTA) said then that the overall bids were "closely matched" in quality.

Dr Lee said: "It shows the operators are closely matched in technical capabilities, for example, in terms of how they schedule and monitor buses, and their plan for recruiting bus captains."

With the Seletar tender closing on Oct 6, potential bidders are gearing up for their submissions.

A Busways spokesman said: "We have been researching other markets... We have visited London, France, Germany and Hong Kong to study 'best practice' operators... We have learnt a lot that is relevant to improving our offer to Singaporeans."

Rides will be greener with electric buses 

Mr Chai says electric buses reduce energy consumption and urban traffic pollution. PHOTO: TRAVEL GSH

Travel GSH's managing director, Mr Chai Yin, who is leading the bid team, said Qingdao Jiaoyun Group's experience in running electric buses could allow the consortium to introduce more green vehicles here.

"The use of electric buses not only reduces energy consumption and urban traffic pollution... (They) have user-friendly designs which provide a higher level of comfort to the public," said Mr Chai.

Electric buses generate little noise and have a lower chassis, making it easier for elderly passengers to board. Operating primarily in the Chinese city of Qingdao and its surrounding rural areas, Jiaoyun has a fleet of 6,000 buses - serving public routes and schools. Half of them are electric vehicles.

Meanwhile, Travel GSH, a tour and coach firm, will also bring its two decades of local experience to the tender bid. It also runs three peak-period feeder services, under contracts awarded by the Land Transport Authority.

Despite being unsuccessful in the Bulim and Loyang tenders, the consortium is more confident of its chances this round. Mr Chai said that it has engaged consultants and conducted market surveys to "beef up" its tender proposal.

Riding on another form of Korean wave 

Mr Lee, chief executive of Kumho, feels that "soft" aspects of commuter experience can be enhanced on the bus, like having announcements for bus stops. ST PHOTO: MARCUS TAN

The quality of bus services in Singapore is already quite high, reckons Kumho Buslines chief executive Lee Dug Yeon, but he feels that the "softer" aspects of the commuter experience can be enhanced.

He told The Straits Times: "For example, there could be announcements on the buses for the current and next stops, like on the MRT. This will help commuters who are taking a bus route for the first time."

He said this is one of the practices Kumho Buslines - which has teamed up with Tian San Shipping in a 49:51 partnership - can bring to the bus industry here.

Some may see the consortium as an unlikely alliance, but Mr Lee said the core business for both Kumho and Tian San, which operates harbour craft, is transportation. "Tian San provides the local market knowledge. Kumho's expertise and know-how will be translated by Tian San," Mr Lee said.

He added that Kumho's drivers are "core" to the bus business, and receive good salaries and welfare.

Kumho is the biggest express bus operator in South Korea, employing around 1,800 bus drivers, with a fleet of over 1,260 buses. Mr Lee added: "Just like we have K-pop, K-drama in Singapore, we would like to bring in the K-bus."

Forty years of local experience on tap 

Woodlands Transport has more than 40 years of experience in Singapore, and the firm expects to bring its knowledge of the local labour market to the tender bid.

Its general manager, Mr Roger Wong, is undaunted that the winners of the previous tender - Anglo-Australian Tower Transit and British-based Go-Ahead - have extensive experience in running public bus operations in their home markets.

"We understand the local labour market well," he said. "We know the expectations of Singaporeans who work as professional drivers. This is our strength."

The firm has a team of 400 bus drivers, 85 per cent of whom are Singaporeans. The rest are from China.

Mr Wong said that, on average, employees with Woodlands Transport have worked for the company for around 15 years - a testament to the firm's ability to keep employees happy. This, in turn, translates into good service for commuters.

Mr Wong said Woodlands Transport has assembled a dedicated 15-strong team who had been working on the first two tender bids. Its 40 years of experience of running chartered, corporate and school bus operations also puts it in good stead, he added.

A version of this article appeared in the print edition of The Straits Times on September 12, 2016, with the headline 'At least five new players eye latest bus tender'. Print Edition | Subscribe