Transport companies in the city have asked the HCM City People’s Committee to
seriously reconsider the ban on public buses carrying advertisements.

Transport companies in HCM City have asked the municipal authorities to revoke the ban on public buses carrying advertisements. (Photo: VNS)

The companies say the
advertisements will help them increase revenues and reduce the subsidy burden on
the city that looks set to rise significantly.

The HCM City People’s
Committee imposed the ban in June 2009 following a proposal made by the
Department of Transport in 2008.

In 2008, the city had
roughly 2,360 buses operating on 153 routes. Each bus could earn ad revenues of
US$2,000 – 3,000 per year, making up a total of US$7 million.

The
Ministry of Culture, Sports and Tourism has also asked the city
administration to lift the bans.

However, the City has
retained the ban on grounds of
traffic safety, claiming the ads could distract other drivers.

Do Kim Dung, deputy
chairman of the Viet Nam Advertisers Association, said each bus could earn
between $2,000 – 4,000 per year by carrying advertisements. He echoed the bus
companies’ claims, saying the money would contribute to the city budget and
reduce its subsidy burden.

Increased
subsidies

The municipal
administration originally plans to subsidise the public bus service with about
VND835 billion ($39.76 million) this year.

However, it is
estimated that the subsidy will increase by VND221 billion ($10.52 million) by
the end of this year because of the increases in petrol prices, according to
Tran Quang Phuong, director of the city’s Department of Transport.

According to the
Centre for Operation and Management of Public Passenger Transport, the subsidy
could increase by an additional VND200 billion ($9.52 million) or so when the
Government’s policy to increase minimum wages takes effect next month.

Experts have
estimated the subsidy for the public bus service this year would reach a record
of VND1.2 trillion ($57.14 million).

City subsidies for
the bus service have steadily increased over the years from VND424 billion in
2005 to VND486 billion in 2006, VND522 billion in 2007, VND610 billion in 2008,
VND676 billion in 2009 and VND841 billion in 2010.

For 37 bus routes
that are not subsidised by the city, the ads are even more critical in helping
deal with the loss in revenue because of fuel price hikes.

Phung Dang Hai, head
of the HCM City Transport Cooperative Alliance, said buses on two routes – from
the Mien Dong Bus Terminal to Nhon Trach and from the Cho Lon Bus Terminal to
Bien Hoa – were incurring losses of VND2.5 – VND5 million ($120 – 238) per day
because of the petrol price hikes this year.

Tickets on non-subsidised
bus routes are more expensive at between VND5,000-25,000, compared to
VND4,000-5,000 on subsidised buses.

Hai explained that
ticket prices on non-subsidised bus routes were already high, so the bus
companies were hesitant to increase it further for fear that customers would not
use their services any more.

But if these bus
companies don’t increase their prices, they would obviously incur more and more
losses in the future, he said.

Dr. Pham Xuan Mai of
HCM City University of
Technology said if the city allowed ads on 3,000 buses, it would
bring VND120-150 billion ($5.71 million – 7.14 million) in revenue, which could
greatly help reduce the subsidy burden on the city.

HCM City now has
about 3,000 buses operating on 147 routes, of which operations on 110 routes are
subsidised.

VietNamNet/Viet
Nam News