Expansion getting difficult for luxurious bus companies

The luxurious bus service providers had been witnessing a boom in business over the years to meet the growing demand for comfortable journeys among long-haul passengers until the Covid-19 pandemic hit the country in March 2020.

The business started to revive when the pandemic began to subside. But such bus companies experienced a downturn in business again after the fuel price hike as passengers became reluctant to use their services.     

Luxurious bus service providers say they have backtracked from earlier plans to expand their fleet as the number of passengers has fallen drastically.

“If an air-conditioned bus worth crores of Taka with the capacity of 28 passengers transports 10-12 per trip, we have no other options but to cut the number of trips,” said Mosharraf Hossain, general manager of Hanif Enterprise.

“We planned to add more buses to our fleet once the pandemic days are over. But we have postponed it now.”

Hanif Enterprise has more than 40 air-conditioned buses transporting passengers to almost all major destinations in different districts across the country.

Transport business insiders said the price hikes of commodities and services because of instability in the world economy caused by the increase in dollar prices following the Russia-Ukraine war had changed travellers’ spending habits.

“Our regular passengers are different than those of non-air-conditioned buses, and they are mostly from the upper class or upper middle class. They are now focusing on saving money, and many are not travelling,” said Managing Director of Shohagh Paribahan Md Faruk Talukder Sohel.

Shohagh Paribahan is one of the oldest bus service providers in the country that now has nearly 50 air-conditioned vehicles manufactured by Sweden’s Scania and Volvo.

Bangladesh’s luxurious bus service providers own air-conditioned units of world-famous Scania, Volvo, Hyundai, MAN, and Mercedes-Benz. Most of the vehicles are imported as completely built-up (CBU) units that cost the companies between Tk 1.7 crore and Tk 2.5 crore.

Some companies like Green Line Paribahan, Shohagh Paribahan, Tuba Line, Heritage Travels, Euro Coach, and Saintmartin Hyundai have introduced sleeper coaches or double-deckers over the years as well.     

The companies also import bus chassis, mainly from India and Japan. The bodies are then built in local workshops.

Bus companies said they are gradually choosing local garages to build buses over importing CBU units because of high cost and falling passenger demand.

There are local garages that can build buses that are almost identical to the world-famous CBU units. But in that case, there is a compromise on the level of comfort that passengers will enjoy.    

Sohel said a few air-conditioned intercity buses used to ply some major routes, including Chattogram, Khulna, and Benapole, some 15-20 years ago.

“In the late 1990s, when air-conditioned bus services were introduced in Bangladesh, the number of regular passengers was very small. But the routes of luxurious buses were increased later due to rising demand,” he said.

He also said when per capita income started rising, people with better financial condition began choosing air-conditioned buses for comfort amid dust and traffic congestion.

“The bus companies were also expanding their fleet gradually. This widened business opportunities for bus manufacturers as well,” Sohel explained, adding, “Intercity bus owners started importing luxurious units from Sweden, Germany, South Korea, and Japan.”  

Industry insiders said due to the high volume of passengers, banks did not hesitate either to offer loans to the existing companies as well as new investors.

When asked how business could be revived, Mosharraf said he would wait and see. “We will not import new air-conditioned buses or expand routes now. The number of trips will be cut as well,” he said.

“But we will need to continue operations as these buses are costly and we cannot keep them idle as the engines and other parts would then be damaged.”

Sohel, however, said he was very optimistic about a revival of business.

“There will be a change in the mindset of passengers who are now avoiding air-conditioned buses if economic conditions improve further. A reduction in fuel prices may help us in the future as well,” he added.