People avoid buses and trains: local transport is making losses due to Corona

Thursday, February 04, 2021

People avoid buses and trains
Local transport is making losses due to Corona

For fear of a corona infection, many people do without public transport during the pandemic. The industry is feeling this: after years of growth, it has lost billions of euros. This could jeopardize their long-term goal.

For years, the number of passengers in local public transport only rose: slowly but steadily, the number of journeys by bus and train rose from 9.6 billion in 2010 to 10.4 billion in 2019 – a record. And even if there was hardly any space in the vehicles, especially at peak times, it should continue like this for the next few years. The industry was aiming for around a third more passengers by 2030. After all, local public transport is an important component with a view to climate change and the turnaround in traffic.

But in the Corona crisis, the goal is suddenly in question. Instead of thinking about new vehicle orders, companies have to see how they can make ends meet. The total damage that the pandemic caused to them amounted to 3.5 billion euros in the past year alone. "And for 2021 we are currently calculating a loss of 3.5 billion euros by the end of the year," said Oliver Wolff, General Manager of the Association of German Transport Companies (VDV).

In the spring of 2020, the demand for public transport fell by up to 80 percent compared to the same period of the previous year, when shops were closed, industry came to a standstill and people worked from home. Others preferred to avoid buses and trains for fear of Corona. The situation improved with the easing in the summer, but after the second lockdown in November things went downhill again. The level is currently around 50 percent below the previous year's figure. "We are above the numbers from spring, but they are very low," said VDV President Ingo Wortmann.

Even at normal times, local public transport is only partially financed through the sale of tickets and subscriptions. The rest comes from the federal and state governments through regionalization funds. But despite the low demand, the transport companies let buses and trains continue to run with almost no restrictions so that people in systemically relevant professions in particular can continue to have enough space to work.

Billion injections from federal and state governments

With an additional five billion euros, the federal and state governments stepped in last year to compensate for the losses suffered by companies. Around 1.5 billion are still left, and from the point of view of the association, another 2 billion euros are needed from the state this year. "In this respect we are now entering into negotiations," said VDV General Manager Wolff. There are "very positive signals".

Meanwhile, there is no telling how the situation will develop in the long term. The VDV and politicians are constantly trying to take away people's skepticism: "There is no study that says that local public transport is a source of contagion," said President Wortmann. Still, many people prefer to get back in the car or look for other ways to get somewhere within the city.

Will it stay that way after the crisis? "There is a real risk that people will behave differently after Corona, for example because they no longer have to go to work as often or simply travel differently," said Tilmann Bracher, head of the mobility research area at the German Institute for Urban Studies. Politicians have a duty to ensure that the car does not benefit in particular. For example, parking space management could encourage more people to leave their cars. "But that's not automatic," said Bracher. In general, driving a car must become significantly more expensive so that people are looking for alternatives.

VDV President Wortmann is nevertheless confident. "At the latest when you can see that the traffic jams are back and the cities continue to grow, you need public transport again," he said. With the extensive maintenance of the offer, the companies would also have maintained good image. It is also important to retain customers, especially those with subscriptions. "The tariff models have to be adapted to the new world of work to some extent," said Wortmann. Anyone who sits in the home office a lot depends on a more flexible type of public transport subscription. However, the association did not make any recommendations for ticket prices in general.