Municipal Transport Companies in the Czech Republic Are Facing Billions in Losses as a Result of the Pandemic

15. 06. 2020

As a result of the coronavirus pandemic, municipal transport companies in the Czech Republic have lost both passengers and fare revenues. The losses at the larger companies range from tens to hundreds of millions of crowns. A total of 21 companies included in the Association of Transport Companies of the Czech Republic (Sdružení dopravních podniků ČR, SDP) have recorded losses that now total 1.1 billion CZK (€ 41 million). A primary goal now of all of these companies is to restore people's confidence in the safety of public transport.

Transport companies throughout the country are facing a serious situation where, as a result of the sharp reduction in the number of passengers being carried, fare revenue has fallen by up to 80 percent. In addition to the financial support provided by municipalities, fare revenues are a substantial source of their income. Transport companies thus have to find a way to cope with these changes in both ridership and income and are looking to do so through reductions in total capacity and extending the intervals between connections, along with reductions to the planned investments. While each municipality is approaching the difficulties of public transport differently, some are also proposing reduced financial support for operations. Collective bargaining agreements, which call for wage increases, just add to the problems that have no simple solutions. The management of all transport companies are unanimous in hoping to be able to avoid layoffs.

In their immediate response to the spread of the coronavirus, transport companies in the Czech Republic took a number of measures to try and ensure the safety of passengers and their employees – restricting access to drivers, the replacement of demand-opening with automatic opening of doors and increased disinfection of vehicles. Some companies have invested in special nanoparticle sprays and ozone equipment for more effective car disinfection. While passenger revenues have shown a dramatic decline, costs have risen with the purchase of disinfectants, protective equipment for employees and other related expenses. Overall, the members of the Association of Transport Companies have invested almost CZK 67 million (€ 2.5 million) in additional preventive measures.

Together with representatives of roughly 80 other transport companies and cities in Europe, our Association of Transport Companies is calling on European institutions to include the urban public transport sector among those designated to receive financial aid for the Covid-19 pandemic from the European Union's Recovery Plan. Recovery funds can clearly help in mitigating the impact the virus has had on transport company finances.

Transport companies also now have another task ahead of them, in addition to helping maintain their financial solvency, which is to restore the public’s confidence in using public transport. A joint marketing campaign is planned in which the companies will seek to attract passengers back to public transport. Throughout the country, the companies are continuing to do their utmost to assure passengers of their safety on public transport.

The Association of Transport Companies is the most important association of public transport operators in the Czech Republic. It brings together 21 different companies, which mainly operate in regional cities and it includes, among other things, all operators of electric rail services (i.e. tram, trolleybus and specialty transport). The vehicles of the member transport companies travel more than 320 million vehicle kilometers a year and carry more than 2.5 billion passengers. They operate 2,844 buses, 1,678 trams, 742 trolleybuses and 143 metro trains. Today, almost 70% of the services use electric traction and carriers have developed concept plans to extend the use of non-fossil fuel vehicles to include a significant investment into electric buses. The companies associated in the SDP employ 21,000 workers, almost half of whom are drivers.

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