Although the local government along the route will take over the bus route from December 21, it is expected that some sections will be closed and services will be reduced. Kongo Bus has been operating a bus route business in this area for nearly 100 years since its establishment, and the population and demand along the route must have been substantial, but why did it choose to withdraw from the bus route business and go out of business?
The direct reason for Kongo Bus’s decision to discontinue all bus routes was a “driver shortage. The company needed 30 drivers to maintain the bus routes, but at the time of the announcement of the discontinuation, there were only 17 drivers (plus 3 support staff from other companies in the same industry). It is no longer possible to maintain the bus route, and the company has turned down offers of subsidies from local governments along the route. Kongo Bus has already withdrawn from the charter bus and cab business, and the company is expected to be liquidated and put out of business after the discontinuation of the bus service.
Across Japan, a number of bus companies have fallen into financial difficulties in the wake of the Corona disaster. However, Kongo Bus, which is located in the commuting area of Osaka City, is not in an area that has been depopulated to the limit, at least not to the extent that it has been. Nevertheless, the company made the decision to discontinue all bus routes.
New towns and prefectural residences are scattered along the bus route, and nearly 300 buses run daily, with approximately 1.1 million people using the buses annually. In addition, since the Kintetsu Nagano Line and Minami Osaka Line can be transferred to the Kintetsu Nagano Line and Minami Osaka Line to reach Osaka City in about 30 minutes, many commuters transfer from bus to train to get to work or school, and some routes are so crowded with passengers that the bus aisles are filled with passengers in the mornings and evenings.
Kongo Bus has been operating bus routes to Tondabayashi City, which has a population of 110,000, as well as Taishi Town, Kawanamachi, and Chihaya Akasaka Village, which are “transportation blank areas” not served by railroads.
(Kongo Bus), which has been operating a bus route business in the southern part of Osaka Prefecture, will discontinue all 15 routes on December 20. The company will withdraw from the bus business itself.
Not Just a Driver Shortage? Municipalities also have their own reasons for the withdrawal of the “Kongo Bus”.
The direct cause of Kongo Bus’s substantial closure was a “driver shortage. However, the company’s business situation has been in the red for about 10 years, and the number of passengers, which was approximately 1.72 million in 2013, has decreased by 40% in 10 years. In 2021, when the number of passengers decreased significantly due to the Corona disaster, the company had a single-year deficit of approximately 71 million yen.
The company has also been outsourcing its bus service to Osaka University of Arts, which has been a source of revenue for the company (the bus appears in the manga “Aoi Honoo” and Hideaki Anno’s self-produced anime “Joubunai Tire”). ), which was the source of the bus service, has already been switched to another company. In this situation, the bus business cannot be maintained without some kind of subsidy or grace period. What was the case with Kongo Bus?
It is estimated that about 90% of all bus routes in Japan are currently in the red. In such cases, the national government first subsidizes up to one-half of the deficit of a bus route under certain conditions. For the remaining one-half, the prefectural and local governments may provide “cooperative subsidies” together with the national government, or the prefectural and municipal governments may provide full subsidies for routes not covered by the national government’s subsidies. The situation varies considerably from region to region.
In the case of Kongo Bus, there was no “cooperative subsidy” for the “remaining one-half” that met the conditions. In some cases, bus companies in Osaka Prefecture (basically most of them are affiliated with major electric railways) are compensated by their parent companies, and when we checked with the Osaka Prefectural Government, they said that the prefecture basically does not provide cooperative subsidies.
Among the municipalities along the line, Tondabayashi City subsidized the costs related to the Kongo buses’ access to the Saber Farm, a park operated by the city, and in 2020, the year of the Corona disaster, the city fare was reduced to 100 yen for a limited time, with the difference made up by the subsidy. At least they did not “sit back and watch”.
For Kongo Bus, however, the government subsidy is only a “deficit subsidy for deficits,” and the municipal subsidy is only a “subsidy for expenses incurred for the convenience of the city,” which at least does not result in positive earnings for the company. Instead, it seems that there were a fair number of demands involving expenditures by the bus companies, such as “increase in the number of buses” and “introduction of transportation IC cards” (which were not realized until the very end), and such demands are frequently found in the minutes of the various council meetings.
In addition, the Kongo Bus’s “Sakurazaka Circulation Line” and “Tojo Line” are crowded in the morning and evening with commuters from New Town and elementary school students, but most users are commuter and commuter passes with low profit margins, and with few users during the day, the bus soon becomes unprofitable.
Such reduction or elimination of bus routes sometimes means the “creation of an area where commuting to work or school is impossible without a car,” and local governments that need buses may take over the routes and operate them at a loss. In the case of Kongo Bus, however, no subsidy was provided. In the case of Kongo Bus, however, no subsidies were provided, and the bus company’s burden ballooned.
The state of the company is in a state of “minimal funding for necessary bus routes, but there are many unreasonable demands. If the company’s management continues to struggle, the treatment of drivers will not improve. A vicious cycle of labor-management conflict and personnel turnover had already begun.
And it was the “Corona disaster” that struck the world in the spring of 2020 and the “recovery of tourism demand after the Corona disaster” that put the final nail in the coffin of Kongo Bus.
First, due to the Corona disaster, the number of passengers on Kongo buses, which had been on the decline even in the past, dropped by another 20%. Tondabayashi City quickly implemented measures such as fare discounts and subsidies for the difference in fares for buses and cabs, but these measures were “cold water” in the face of the company’s long-standing deficit. Kongo Bus’s financial situation deteriorated further, leading to the company’s withdrawal from the charter bus business in April 2020 and the discontinuation of its cab business in May 2023.
Furthermore, in addition to the shortage of drivers, the number of job openings for sightseeing buses increased along with signs of recovery from the Corona disaster. In the Minami-Osaka area near Kansai International Airport, there was a competition for people with large-size bus licenses. Many bus companies offer better conditions than those for route bus drivers, who are paid a basic salary of 190,000 yen (according to the company website), and Kongo Bus has reported a string of driver resignations since last fall.
While there are now many cases of local governments recruiting bus drivers with additional support and subsidies for migration, Kongo Bus did not have such a helping hand. However, Kongo Bus did not have such a helping hand. The company eventually ended up discontinuing all of its bus routes and practically going out of business due to a lack of drivers.
© Source travel watch
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