As the main force of urban transportation, China's urban public transportation is facing development bottlenecks, with a continuous decline in the ridership of ground public transport, high government subsidies for urban public transport, increasing investment in public transport construction, rigid operation and scheduling models, and high occupancy rates leading to serious waste of public transport resources, among many other challenges, which severely affect the effectiveness of urban traffic governance.

How does the industry view the current challenges facing urban public transportation development? Do public transport companies urgently need to explore the establishment of an "public welfare + market-oriented" operation model? What is the core competitiveness of public transport companies? Under the national policies of carbon peak and carbon neutrality, what preparations does the urban public transport industry need to make now?

In response to these hot topics of market concern, Saiwen Transportation Network invited five guests, including Yang Tao, Vice President of the China Urban Public Transport Society, Chen Yanyan, Dean of the School of Urban Transportation at Beijing University of Technology, Liu Xianglong, researcher at the Ministry of Transport's Scientific Research Institute, Xie Zhendong, Chairman of Guangzhou Yangcheng Tong Co., Ltd., and Li Song, founder of Shanghai Zhengxian Electronic Technology Co., Ltd., to share their feelings and suggestions.

1. Challenges Facing the Development of the Public Transport Industry

Saiwen Transportation Network: As the main force of urban transportation, China's urban public transportation is facing development bottlenecks, with a continuous decline in the ridership of ground public transport, high government subsidies for urban public transport, increasing investment in public transport construction, rigid operation and scheduling models, and high occupancy rates leading to serious waste of public transport resources, among many other challenges, which severely affect the effectiveness of urban traffic governance. How do you view the current challenges facing urban public transportation development?

Yang Tao, Vice President of the China Urban Public Transport Society: First, regarding the issue of declining bus ridership. The continuous decline in bus ridership in various cities is a common trend, caused by multiple factors, including the ongoing impact of the COVID-19 pandemic, the low cost of owning and using private cars leading to abuse, and the convenience of the proliferation of electric bicycles, which has led to a continuous increase in individual travel modes; the increasingly congested road traffic and the lack of sufficient protection for bus priority rights have worsened the operating environment for surface public transport; and public transport itself, in terms of network and station, vehicle allocation and departure frequency, operational speed, punctuality and stability, ticket prices, and information services, cannot meet passengers' needs for convenience, timeliness, predictability, reliability, and other aspects.

Secondly, regarding the issues of rigid bus operation scheduling models and high occupancy rates leading to serious waste of public transport resources. We must acknowledge and face these problems, which are not only related to the operation scheduling model but also include shortcomings in the composition model of the public transport system, investment and operation models, vehicle organization models, smart service models, etc., all of which need to be reviewed and reflected upon. The public transport industry and companies need to be passenger-centered, service-oriented, integrating public service and market mechanisms, actively striving for progress, reform, and innovation to turn the situation around and boost confidence.

At the same time, it is inappropriate to over-interpret or overcorrect, leading to a significant reduction in bus vehicle deployment, a substantial decrease in bus departure frequency, and a significant increase in waiting times for bus travel, causing public transport services to become untrustworthy, with no one daring to ride, and public transport companies left helpless, even leading to some small cities completely suspending bus services, creating an increasingly passive vicious cycle!

Thirdly, regarding the increased investment in public transport and the high level of subsidies. This must be analyzed objectively and calmly, based on facts, and not based on feelings or impulsive decisions! Overall, China is a populous country with tight resources and a fragile environment. The development of urban transportation (including intercity and urban-rural transportation) must prioritize public transport, lead with public transport, and follow a green and low-carbon path. The spatial development of cities and regions must also follow a bus-oriented, intensive, and green low-carbon path.

However, the current structure, capacity, and service capabilities of China's intercity, urban, and urban-rural public transport systems still have significant shortcomings, with imbalances and inadequacies being quite prominent. There is a need to continue increasing investment and accelerating construction, which can also stimulate domestic demand, increase employment, enhance services, and promote development in various ways.

At the same time, regarding the so-called high public transport subsidies, although the public transport industry and companies have the responsibility and necessity to reform, cut costs, and increase revenue, it cannot be entirely blamed on the public transport industry and companies. The public nature and welfare attributes of public transport indicate that the government has an unshirkable responsibility, and public finances must pay for the public welfare services of public transport; this is not so-called 'public transport subsidies,' but rather government purchases of public welfare services.

Chen Yanyan, Dean of the School of Urban Transportation at Beijing University of Technology: In recent years, the development of urban public transport has indeed encountered various problems as you mentioned, facing various challenges posed by the times. To see the essence through the phenomenon, it may be helpful to analyze the root causes of the problems from the perspectives of the external environment and changes in demand for public transport development, as well as the current situation on the supply side, and to find corresponding countermeasures.

First, from the perspective of the current external development environment, under the continuous impact of the COVID-19 pandemic for three years, the transportation industry, especially the public transport sector, has been greatly affected. Taking Beijing's public transport as an example, the total passenger volume of public transport in 2020 decreased by more than 40% compared to 2019, and in 2021, the total passenger volume of public transport only recovered to about 80% of the pre-pandemic normal level of 2019. Secondly, under the wave of the internet, many non-traditional transportation service companies have flooded into the transportation market with capital, creating both prosperity and chaos in the transportation market in recent years, with the market pattern constantly reshuffling.

Second, from the perspective of changes in demand, in the past decade, China's cities have developed rapidly, and people's living standards have continuously improved, with the number of private cars constantly rising (at the end of 2010, the national private car ownership was about 65.38 million, while by 2021, it had reached about 302 million). Travel choices have become more diverse, and the travel demands of urban residents have shifted from being primarily economic to multi-dimensional needs such as efficiency, convenience, punctuality, comfort, individuality, safety, and economy. The current public transport services can no longer meet the ever-changing demands.

Third, from the perspective of public transport operating companies themselves, the corporate system and management methods are relatively backward, the operating models lack innovation, the level of intelligence is low, and the overall service level is not high, leading to low product competitiveness of public transport services (especially surface public transport) in the current transportation service market, making it difficult to compete effectively with other modes of transportation.

In summary, compared to the rapid changes in the external environment and demand side, the speed of supply-side reform in public transport is relatively slow, leading to a serious mismatch between supply and demand, and this situation is likely to continue for some time, with the growing pains of the public transport industry not decreasing in the short term.

Liu Xianglong, researcher at the Ministry of Transport's Scientific Research Institute: Currently, the transformation and development of China's urban public transport industry can be described as having both opportunities and challenges, facing competition from other transportation modes such as private motorization, the repeated impact of the pandemic and the normalization of prevention and control, the sustainability of fiscal subsidy policies, and insufficient competitiveness. At the same time, it also welcomes development opportunities in building a strong transportation country, achieving dual carbon goals, and accelerating the integration and application of high-tech.

First, the "Outline for Building a Strong Transportation Country" requires "strengthening the comprehensive management of urban traffic congestion, prioritizing the development of urban public transportation, encouraging and guiding green public transport travel, and reasonably guiding individual motorized travel"; in the "National Comprehensive Three-Dimensional Transportation Network Planning Outline", it states, "Looking forward to 2035, a modern high-quality national comprehensive three-dimensional transportation network will be basically completed, with the 'National 123 Travel Traffic Circle' (one-hour commuting in metropolitan areas, two-hour access in urban agglomerations, and three-hour coverage of major cities nationwide)". The two outlines point out the direction for the system planning, facility construction, and diversified high-quality scientific development of urban public transport.

Second, the "dual carbon" goal is the overall grasp for strengthening ecological civilization construction under the new situation. To achieve this goal as soon as possible, it requires the transportation industry to actively guide green and low-carbon travel. For cities, although the public transport share has declined in recent years due to various factors, public transport remains the mainstay of urban passenger transport services and is an important way to alleviate urban traffic congestion and provide basic travel services for urban residents, making it necessary to deepen development.

Third, with the deep integration of high-tech information technologies such as big data, artificial intelligence, blockchain, the Internet of Things, and cloud computing with transportation, new momentum has been injected into public transport development. Through intelligent bus scheduling systems, timely intelligent scheduling can now be conducted based on various factors such as passenger flow, vehicles, charging, personnel, and road conditions; technologies such as ADAS, DMS, and big data profiling can significantly enhance the industry's safety supervision capabilities; collaborative services with other transportation modes will greatly enhance the diversified and integrated service capabilities of urban transportation, meeting the personalized high-quality travel needs of various users; at the same time, with the continuous exploration and application demonstration of autonomous driving technology in the public transport field, there are infinite possibilities for reducing costs and increasing efficiency in public transport.

Li Song, founder of Shanghai Zhengxian Electronic Technology Co., Ltd.: Urban public transport is a systematic project. The development of the bus system is not just about infrastructure investment; it is also important to study the various structural levels of the public transport system, fully utilize the functions and service characteristics of each subsystem, and form an efficient bus operation plan. At the same time, the government should adhere to the strategy of prioritizing the development of public transport, introduce policies to further increase support systems, and encourage public transport travel.

2. Public transport enterprises urgently need to explore the establishment of a "public welfare + market-oriented" operating model.

Saiwen Transportation Network: There are opinions in the industry that the national public transport passenger flow has significantly decreased. Faced with the increasingly fewer passengers and unsustainable subsidies, public transport enterprises need to explore the establishment of a "public welfare + market-oriented" operating model. What is your opinion?

Li Song, founder of Shanghai Zhengxian Electronic Technology Co., Ltd.: Public transport itself is a service method provided by the government for the public. It needs to consider various routes, many of which cannot be profitable. It is difficult for public transport to truly achieve marketization. I believe public transport should establish an effective big data analysis platform to reasonably optimize the network and scheduling, minimize operating costs, and increase public transport revenue. At the same time, the government can provide certain resources to allow public transport to explore operational methods, such as utilizing resources from the bus body, waiting station resources, and terminal resources, allowing public transport enterprises to reduce the government's burden through operational income.

Yang Tao, vice president of the China Urban Public Transport Society: I fully agree that the public transport industry and enterprises should quickly break through the administrative, monopolistic, closed, and singular models that have continued since the planned economy era. While adhering to the public welfare guarantee, public service, intensive efficiency, and green low-carbon attributes and development concepts of public transport, we should remember and learn from the courage and determination of Comrade Xiaoping to boldly break through the debate over whether the market economy is capitalist or socialist. We should learn from the successful paths and advanced experiences of public transport industries and enterprises in public transport cities like Hong Kong and Singapore, integrating the "publicness and public welfare" of public transport with "diversification and marketization", viewing passengers as customers, customers as gods, and enterprises as enterprises, respecting market rules, understanding customer sources and flows, activating resource assets and capital, and leading the public transport industry and enterprises onto a path of adapting to passenger needs, ensuring public welfare services, and achieving stable, healthy, and sustainable development!

Chen Yanyan, dean of the School of Urban Transportation at Beijing University of Technology: First, it can be affirmed that "public welfare + marketization" is a public transport development model that aligns with China's national conditions and future development requirements. However, "public welfare" and "marketization" as modifying attributes have different objects. Specifically speaking:

First, the functional positioning of "public welfare" must remain unchanged. The modifying object of "public welfare" is the social functional positioning of public transport. China's national economic classification lists urban public transport as part of the "public facilities service industry", rather than the "transportation industry". Public welfare is an important characteristic of China's public transport industry.

The reasons are as follows: On the one hand, although China has made great achievements in economic development, compared to developed countries, the per capita social resources in China are still relatively scarce and unevenly distributed, and transportation service resources are no exception. On the other hand, the development of the social economy relies to some extent on transportation services, and people's economic activities cannot be separated from transportation. Therefore, public transport, as a high-capacity, low-cost transportation method, should fully leverage its public welfare attributes, reflect social equity, and promote social harmony.

Second, the insistence on the "market-oriented" operating model must remain unchanged. The modifying object of "market-oriented" is the enterprise operating model of public transport.

First, it must be clear that maintaining the "public welfare" positioning of public transport does not mean abandoning the market. The public transport industry is a fee-based service industry, and public transport enterprises are social entities engaged in business activities. The business activities of all transportation enterprises, including public transport enterprises, are conducted in a unified market, and all market rules also apply to public transport enterprises.

Therefore, if public transport wants to fully realize its social value and ensure the sustainable development of public transport enterprises, it must adhere to the unchanged "market-oriented" operating model, continuously carry out market-oriented reforms of enterprises under government supervision and support, actively engage in market operations, and maintain its competitive ability.

 

3. What is the core competitiveness of public transport enterprises?

Saiwen Transportation Network: Imagine if in the future, under the dual carbon target strategy, the government further increases support for public transport, providing absolute support for industry development while also setting higher requirements and expectations. Is the public transport industry itself strong enough to be reliable and capable of meeting these expectations? What do you think, and what do you believe is the core competitiveness of public transport enterprises?

Yang Tao, vice president of the China Urban Public Transport Society: First, facing passengers, the public transport services provided by public transport enterprises should be marketable and achieve high-quality service, fully meeting passengers' needs for sufficiency, convenience, accessibility, timeliness, reliability, comfort, economy, and dignity, while also having sufficient competitiveness and attractiveness compared to individual motorized travel methods such as cars, motorcycles, and electric bicycles.

Second, facing the city, public transport enterprises should maintain a reasonable level of public transport share necessary to support and promote the healthy and sustainable development of urban transportation.

Third, for public transport enterprises themselves, they need entrepreneurs and their teams with high political awareness, pioneering spirit, innovative consciousness, professional level, and decision-making and management capabilities; they need to establish scientific, standardized, and systematic rules and regulations, standard systems, operational supervision assessments, and incentive and punishment mechanisms aimed at enterprises, passengers, and employees; they need to establish a public transport information and intelligent decision support and travel service platform and system based on the integration of diverse big data, aimed at decision-making, management, and service; they need to establish a public transport resource asset capital operation mechanism that conforms to market rules and mechanisms, forming a sustainable financial self-supply and support capability for the survival and development of public transport enterprises!

Chen Yanyan, Dean of the School of Urban Transportation at Beijing University of Technology: As a key industry for carbon emissions, transportation will see increased government support for public transport under future dual carbon goals, and the expectations and demands placed on public transport by the government will also grow. As the saying goes, 'To forge iron, one must be strong oneself.' If the public transport industry is to play its due role in advancing China's dual carbon goals, I believe relevant enterprises need to strengthen the following core competencies:

First, modern enterprise management capabilities. The management system of public transport enterprises is fundamental to all operational activities. In the future, public transport enterprises must break away from the existing crude management methods and enhance their modern management level and social competitiveness through management system reforms, organizational optimization, improved distribution systems, sound assessment mechanisms, and talent cultivation.

Second, market-oriented operational capabilities. As mentioned earlier, the importance of a market-oriented business model can be enhanced through comprehensive development of public transport land, advertising revenue, data value-added services, carbon trading, and other market means to reduce dependence on government subsidies.

Third, personalized innovative service capabilities. The travel needs of urban residents will become increasingly diverse in the future, and a single public transport service product can no longer meet these needs. Customized buses, demand-responsive buses, travel information release and guidance, and new forms of personalized innovative public transport services such as Mobility as a Service (MaaS) should all be included in the business scope and development direction of public transport enterprises, transforming from public transport operators to diversified urban transportation service providers, fully utilizing their own data advantages, collaborating with other social resources, and comprehensively enhancing the sustainable profitability of enterprises.

Fourth, intelligent comprehensive decision-making capabilities. Currently, most public transport enterprises in China have relatively low levels of intelligence. Core decision-making tasks such as operation scheduling, route planning, line adjustments, station optimization, and vehicle management lack intelligent support, and the potential value of enterprise data has not been deeply explored. Blind and experience-based measures can easily lead to waste of transport capacity and unnecessary increases in social carbon emissions. Therefore, in the future, public transport enterprises should focus on enhancing intelligent comprehensive decision-making capabilities, coordinating with modern management, and creating proactive and feasible innovative transport services.

4. What preparations does the urban public transport industry need to make under the dual carbon goals?

Saiwen Transportation Network: Under the national policies of carbon peaking and carbon neutrality, what preparations does the urban public transport industry need to make now?

Yang Tao, Vice President of the China Urban Public Transport Society: First, the entire industry and society must fully recognize the contribution and severity of direct and indirect carbon emissions from the transportation industry, as well as the arduous and urgent tasks of reducing carbon emissions in the transportation sector; second, formulate and issue the 'Environmental Protection and Green Development Promotion Law for Transportation'; third, develop and publish national, local, and urban transportation development white papers guided by the commitment to dual carbon goals; fourth, solidly carry out basic research on carbon reduction technologies, strategies, and standards in transportation; fifth, vigorously promote comprehensive demonstration projects for various carbon reduction technologies, engineering, and regions in transportation.

Chen Yanyan, Dean of the School of Urban Transportation at Beijing University of Technology: Under the national policies of carbon peaking and carbon neutrality, all sectors of transportation, including public transport, will continuously face new challenges and changes. Currently, the Ministry of Transport, the National Railway Administration, the Civil Aviation Administration of China, and the State Post Bureau have jointly issued implementation opinions to implement the 'Opinions of the Central Committee of the Communist Party of China and the State Council on Fully and Accurately Implementing the New Development Concept and Effectively Carrying Out Carbon Peaking and Carbon Neutrality Work' (hereinafter referred to as 'Opinions'), clarifying the direction for accelerating the green and low-carbon transformation of transportation and effectively carrying out carbon peaking and carbon neutrality work in transportation. In addition to the specific requirements mentioned in the 'Opinions' regarding optimizing the transportation structure, promoting energy-saving and low-carbon transportation tools, actively guiding low-carbon travel, and enhancing new momentum for the green transformation of transportation, I believe the transportation industry, especially transportation enterprises, also need to make the following preparations:

First, fully implement the national dual carbon strategy requirements and the 'Opinions', update industry understanding, adjust enterprise development thinking, focus on the long term, and formulate scientific industry or enterprise dual carbon promotion strategies and implementation paths.

Second, based on advanced technologies such as big data, artificial intelligence, and information technology, build a dynamic monitoring and management platform system for carbon emissions in the industry or enterprise, comprehensively grasp the carbon emission and energy consumption status of the industry or enterprise, and its temporal and spatial changes, optimizing enterprise operation organization to achieve visible and controllable carbon emission targets.

Third, actively participate in the technical research and implementation of carbon trading-related chains such as carbon emission quantification standards, carbon quota allocation and fulfillment mechanisms, and MRV accounting systems, seizing policy opportunities and enhancing the industry's or enterprises' ability to participate in carbon trading.

Xie Zhendong, Chairman of Guangzhou Yangcheng Tong Co., Ltd.: The 'dual carbon' goal will strongly promote the transformation and upgrading of the public transport industry, which is a major carbon emitter. In this process, 'public transport priority' and 'green travel' will become key to achieving the 'carbon neutrality' and 'carbon peaking' goals of the entire public transport system.

Under the background of the 'dual carbon' goal, the future (or present) public transport industry can explore a low-carbon development framework of 'electrification-digitalization-intelligentization-customization', transforming its advantages in infrastructure, operational services, and transportation big data into driving forces for achieving the 'dual carbon' goals, thereby promoting the low-carbon development of the public transport industry.

'Electrification' involves gradually replacing traditional buses with energy-saving and new energy buses, fundamentally reducing carbon emissions during public transport operations.

'Digitalization' transformation will achieve monitoring and control of the entire public transport operation service process, ensuring the safety and efficiency of public transport operations.

'Intelligentization' upgrades can turn public transport vehicles into 'city scanning robots', perceiving the operational status of urban transportation systems and the distribution of passenger travel demand, upgrading the urban public transport system towards 'automation and intelligence', promoting the development of the autonomous driving industry based on artificial intelligence technology, and constructing safe and efficient operational scenarios for large-scale applications of autonomous driving buses, which will effectively drive the transformation and upgrading of the public transport industry.

'Customization' aims to meet the development needs of public transport services for 'carbon neutrality', exploring and cultivating new models of 'Mobility as a Service (MaaS)', establishing a green emission reduction incentive system, encouraging public participation in green travel, enhancing public transport driving safety, optimizing route infrastructure, improving operational efficiency, and ultimately building a diversified industrial ecosystem to form a sustainable development model and achieve the 'dual carbon goals'.

Liu Xianglong, researcher at the Institute of Scientific Research of the Ministry of Transport: To enhance sustainable development capabilities, the public transport industry needs to focus on comprehensive resource development and diversified operations, enhancing its self-sustaining capabilities. To this end, public transport enterprises can deeply explore existing traditional elements such as people, vehicles, stations, facilities, lines, and charging piles, such as comprehensively developing stations to improve land resource utilization efficiency and comprehensive development benefits, and can also widely rely on existing capabilities to carry out social services such as vehicle maintenance and inspection.

On the other hand, it is especially important to increase the management of new economic elements such as data, carbon, tickets, electricity, vouchers, and customers. For example, in terms of data, we can leverage the massive business data generated by the public transport industry to empower and add value to the upstream and downstream industrial chains of vehicles, energy, travel services, advertising, and more. In terms of electricity development, we can shift from being energy users to energy operators, relying on the current characteristics of the public transport industry, which has a large scale and strong capacity for parking, storage, and charging. In terms of ticket development, we can utilize the connectivity of tickets to strengthen the integration of travel services with consumption services such as tourism, following the development concept of modern transportation + services.

Source:Saiwen Transportation Network