Greyhound has announced that it is going to curtail it’s service in Manitoba and Northwestern Ontario because it can’t make money on those routes. Federal Transport Minister John Baird is playing politics when he said:
This is clearly an attempt to shakedown Canadian taxpayers for tens of millions of dollars a year from this Texas-based multinational
Yes, Greyhound is saying they need government concessions if they were to continue operations. Such concessions include relaxed regulations and some “money”, perhaps $15 Million. But they didn’t start the shakedown.
Greyhound lays it out quite clearly in their press release:
… We have repeatedly asked the federal and provincial governments to change the existing legislative and regulatory regimes that govern inter-city bus operations…
… All of the provinces in which Greyhound operates exercise some form of regulatory oversight over scheduled intercity bus operations. Bus operators are being forced to financially support unprofitable route services to small-town Canada through an intricate web of cross-subsidies from their profitable passenger routes, from bus parcel operations and from ancillary profit sources.
So government already shook down Greyhound, forcing them to serve unprofitable routes without providing any subsidy to do so. The governments essentially thought they could demand that Greyhound should serve the “public welfare” and lose money doing it. This is completely ridiculous. Greyhound is a business that can (and should) choose to invest it’s capital in places it can make money. And if serves small towns in Northern Manitoba don’t make money, they shouldn’t have to go there. If government wants to pay Greyhound to serve those routes, let the people of Manitoba vote for it. But don’t badmouth the “greedy American capitalists” as one commentor at a national newspaper’s site did…
4 comments
MrEd says:
4 September 2009 at 13:02 (UTC -7 )
If you’ve flown into Winnipeg (which I have already 3x this year) you’ve seen the new and active Greyhound terminal at the airport… You’ve probably also seen the skids and skids of cargo that line the boarding area there as Greyhound is the prefered courier in Manitoba for most businesses…
If they want to be profitable cut routes, raise shipping rates, and raise fares…
That’s how normal businesses operate pre Obama and Coalition forced Gov’t Bail out plans…
If they can’t make money there than someone else will find a way to because from the piles of box’s waiting to be loaded on the dock there they aren’t losing money
Taliesyn says:
4 September 2009 at 20:32 (UTC -7 )
Remember that they are mandated by provincial law to serve the small towns, so they can’t cut routes if they stay in the province. Raising rates could bring an outcry, plus reduce traffic – so they would be no better off. The problem is the government regulation.
Powell Lucas says:
4 September 2009 at 20:25 (UTC -7 )
If these clowns are losing money why don’t they just raise fares. I drive a car and my cost of transportation has gone up considerably in the last couple of years. If I want to drive, I have to pay. Same goes for bus riders and shippers. If the carrier isn’t making money then it can raise fares. Why should the taxpayer subsidize the bus rider. The government isn’t helping me out with the cost of driving my car; in fact they’re just heaping more taxes on it.
Taliesyn says:
4 September 2009 at 20:30 (UTC -7 )
They could raise their fares, but I suspect they are regulated, or quickly would be when the people in remote towns get on the CBC and demand government help because they can’t afford the fares…