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No end in sight to pandemic-induced passenger transport crisis
Global | Geneva

No end in sight to pandemic-induced passenger transport crisis

17 Sep 2020 · Prosperity

IRU’s first COVID-19 Impact Report demonstrated just how bad the pandemic has been for passenger transport companies. The report estimates revenue losses of 57% for European firms alone in 2020. Bus and coach services for tourists are suffering the most, with losses in that segment in Europe expected to reach 82% this year. 

Governments need to act to save the sector, as increased use of collective passenger transport is essential to reaching European Green Deal targets and driving post-pandemic economic recovery.

Travelling by bus rather than private car is a simple and easy way to reduce emissions. And, with a pre-pandemic driver shortage of 19%, the sector will be a significant source of employment if brought back to full strength. This is all the more important given that the rate of youth unemployment is 16% in the EU and is set to increase as “Generation Corona” struggle to find work. 

Here we share recent updates from IRU members and how their companies and governments have been dealing with the ongoing crisis. 

United States: government support missing

The majority of coach transport operators in the United States are small and family-owned. IRU member the American Bus Association reports that, in the absence of passengers during the pandemic, 3,000 small businesses closed their doors, furloughing more than 100,000 employees and leaving idle 36,000 vehicles.

Congress could have avoided this situation by passing the Coronavirus Economic Relief for Transportation Sectors (CERTS) Act, providing the financial support coach companies needed to ride out the pandemic.

Netherlands: coaches on the brink of collapse

According to IRU member Koninklijk Nederlands Vervoer, turnover losses of 90% are commonplace for coach companies. As we are entering the low season, businesses do not expect to see improvements in the near future. Some companies have already been forced to lay off staff and, if current trends continue, the best-case scenario is 40% of companies going bankrupt. 

Support measures only cover 20% of the ongoing fixed costs of coach companies. This means that operators are still paying 80% of these costs out of pocket, while facing turnover losses of up to 90%. 

Sweden: passenger transport welcomes financial support 

In Sweden, the government has announced that financial support measures for passenger transport will be extended for another three months. IRU member Transportforetagen stresses the importance of this aid, considering that passenger transport lost up to 90% of its revenues, practically overnight. 

The pandemic is having an unprecedented effect on otherwise viable and healthy companies. Financial support is vital to avoid the collapse of the passenger transport sector. The extension of the government’s measures has therefore been welcomed by Swedish transport operators. 

Elsewhere, operators are in desperate need of financial support from governments, as there is no sign of coach tourism picking up any time soon. IRU has set out a ten-point recovery plan to guide governments in taking the necessary steps to support a sector in crisis.