Victory Liner, bus groups warn services at risk as fuel costs soar

MANILA, Philippines — Provincial and city bus operators warned that a fare freeze designed to protect commuters could ultimately leave them with fewer buses and longer waits after diesel prices rose another P8.82 per liter Tuesday.

In an appeal circulated by Victory Liner and signed by several bus operators' groups, the industry renewed its call for the government to lift the suspension of fare increases approved earlier this year.

The groups said fuel now accounts for roughly 45% to 60% of operating costs, while regulated fares have failed to keep pace with expenses.

"This is not a threat to stop operations," the groups said. "This is a notice that operations may soon become impossible."

The statement was signed by the Provincial Bus Operators Association of the Philippines, Nagkakaisang Samahan ng Nangangasiwa ng Panlalawigang Bus sa Pilipinas Inc., SOLUBOA and the Mega Manila Consortium.

Pump prices rose sharply for a third consecutive week on September 22, with diesel climbing P8.82 per liter, gasoline P4.88 and kerosene P6.47.

Over the past three weeks, diesel prices have increased by P18.31 per liter, gasoline by P15.25 and kerosene by P16.67.

The bus groups said higher fuel prices add to the cost of fleet modernization, loan payments, spare parts, tires, maintenance, insurance, tolls and regulatory compliance.

An impending wage increase would add further pressure, they said, arguing that higher worker pay must be supported by enough revenue to keep services running.

"No industry can survive when its regulated revenue is lower than the actual cost of delivering its service," the groups said.

Fare freeze's trade-off

The Land Transportation Franchising and Regulatory Board approved higher city and provincial bus fares in March as fuel costs surged.

The minimum fare for ordinary city buses was set to rise by P2, while air-conditioned city buses were granted a P3 increase. Provincial buses were approved for a P1 increase for the first five kilometers, with higher succeeding per-kilometer rates depending on the bus class.

President Ferdinand Marcos Jr. suspended the increases on March 18 before they could take effect, citing the burden on commuters already facing higher living costs.

Bus operators now argue that keeping fares below operating costs could create a different problem for commuters. If companies become insolvent or abandon routes, passengers could face fewer buses, fewer trips and longer waits.

"We cannot freely increase fares. We cannot impose a fuel surcharge. We cannot compromise safety or maintenance... We cannot simply stop operating without risking the abandonment or cancellation of our franchises," the groups said.

Fuel costs feed inflation

The appeal also comes as transportation costs have risen despite the fare hike suspension. Transport inflation accelerated to 13.5% from 11.9% in July, according to the Philippine Statistics Authority.

Among the poorest 30% of households, transport prices climbed 15.3% from a year earlier.

The Department of Energy attributed the latest pump-price increases to disruptions in global oil supply amid the continuing conflict in the Middle East.

On September 15, the DOE certified that the one-month average price of Dubai crude had breached $80 a barrel, the threshold for the government to consider reducing or suspending excise taxes on petroleum products. The issue has been referred to the Development Budget Coordination Committee.

The operators said they weren't seeking subsidies or asking taxpayers to cover their losses. Instead, they want regulated fares to reflect the cost of running their services.

"We do not ask for charity," the groups said. "We ask for urgent action."