Service Design in Competitive Tendering of Bus Routes

Abstract

Transit systems and buses, in particular; generally suffer from severe financial problems that affect their sustainability and levels of service. In an attempt to revive these svstems, public authorities have recently moved toward more private sector participation, which could improve cost efficiency. This participation can take different forms depending on the roles of each sector in the provision and production of public transport. This article examines the different models for private sector participation in the provision of mass transit services, describing their respective benefits and disadvantages for both transit providers and users. Focus is, however; given to one specific strategy-s-competitive tendering-because of its successful application worldwide and its suitability to the case study context. Competitive tender structuring elements that relate to determining the size of the contract to be tendered as well as the allocation of routes among bid packages ("service design") is discussed in particular. A sound methodology for assessing bid packages of routes is developed and then applied for the case study of Beirut, Lebanon.