Greyhound exit to spur innovation: prof

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This article was published 11/07/2018 (2361 days ago), so information in it may no longer be current.

OTTAWA — Greyhound Canada’s decision to pull out of the Prairies this fall means it’s finally time to craft innovative ways for Manitobans to move around, according to a leading transportation expert.

“This is an issue that I’ve thought had been a problem for a long time. It’s really been ignored,” said Barry Prentice, a University of Manitoba supply chain management professor.

Intercity bus ridership has been on the decline in Canada since the 1950s, an issue the provinces, the Senate and Ottawa have all taken a crack at studying over the past three decades. Prentice said while many of those reports’ findings hold true today, Canada still hasn’t taken a thorough look at how to solve transportation gaps, unlike governments in the United States.

Instead, car ownership has increased while gas and vehicle prices remain lower than other industrialized countries and lower airline fees attract most of Greyhound’s long-distance clients.

“If you start getting less people using it and less frequent service, it becomes even less desirable and people chose not to use it.”

The issue was highlighted by the 1992 Royal Commission on National Passenger Transportation, which examined everything from highway safety to ferry service.

For intercity bus service, the report suggested provinces harmonize a patchwork of regulations in order to foster more competition. It proposed short-term subsidies to facilitate such a transition.

The 1992 report predicted smaller buses and minivans would serve rural communities instead of coaches, something only common in Newfoundland at the time.

Jim McNiven, a former Nova Scotia deputy minister and Dalhousie University professor who was part of the commission, said that came true in the Maritimes after region’s major coach service shut down in 2012. He regularly sees minibuses zipping across the region, which seem popular with commuters.

“It seems to meet a need; it doesn’t look like they’re dying out,” he said.

Just this week, Thunder Bay-based Kasper Transportation said it would start service along some of Greyhound’s abandoned Prairie routes using its smaller buses, which sit 10 to 20 passengers.

Prentice said Churchill’s railway disruption and the looming Greyhound pullout could be the impetus needed for Canada to take a serious look at how people in the Prairies and less-populated areas get around.

“In some respects, these events, which are somewhat cataclysmic and not very desirable… have sort of shed light on the problems of remote communities in general,” he said.

South of the border, North Dakota State University runs the Upper Great Plains Transportation Institute, which researches and teaches on issues such as rural bus service and accessibility. The centre’s research has helped craft projects that intend to help aging baby boomers get around without a car.

Because Canada is so much more spread out than the United States, Prentice said governments ought to put up cash for academics to come up with transportation solutions — and to collect more data.

As an example, Statistics Canada collects precise information on inter-urban and rural transportation, but the agency does not assemble it for the public due to a lack of demand.

Yet the agency’s monthly revenue reports show a steady decrease in coach-service profits since 2005, while older data on ridership show a decline from roughly 32 million passengers in 1980 to about 14 million by 2000.

Marc Gaudry, a Université de Montréal economics professor said that’s probably due to cuts to service from carriers that kept slashing their routes.

Greyhound threatened to leave Manitoba entirely in 2009, but reneged when the province offered a $3.1-million subsidy. When Manitoba loosened its regulations in 2012, the company axed 12 provincial routes.

Prior to that, intercity buses received virtually no subsidies, unlike airlines and Via Rail, yet the bus companies still paid the fuel taxes used to subsidize road repairs and environmental programs.

Gaudry said governments were reluctant to embrace the 1992 report’s overall recommendation — governments stop almost all subsidies — because it’s politically unpopular to cause train and plane ticket prices to rise.

But he argued cutting back those subsidies would have led to a market disruption where smaller carriers filled the gaps, or at least kept monopoly prices lower — something that was never allowed to happen and thus produced Greyhound’s drastic pullout this week.

“It’s extremely hard to do (cutbacks) on the political side,” Gaudry said. “There were distortions.”

He noted that opening up competition has led to more companies operating in Ontario and Quebec, from express routes to cheaper companies that pick up passengers curbside and don’t pay bus station fees.

A 2015 Rutgers University study found new curbside companies had likely reversed a U.S. decline in coach service for the first time in five decades. But Gaudry admits small-bus models may be more challenging in the Prairies, where population density is lower.

Prentice said that’s precisely why Manitoba needs research to work out new ways to meet its transportation needs.

In 2002, the Senate transportation committee suggested federal tax credits could help support both existing and start-up coach companies, an idea Ottawa never followed through with. Meanwhile, a 2010 joint task force between the provinces suggested individual jurisdictions subsidize specific routes that aren’t economically viable.

“I think what we need is a real review of the regulations and the situation of buses, period,” Prentice said.

As an example, Greyhound previously said it had been undercut by Manitoba First Nations operating their own shuttles to Winnipeg; Prentice said those shuttles might be able to expand and pick up passengers from other communities. “I don’t think we necessarily need to have a national bus network anymore.”

John Helliwell, a retired University of British Columbia economics professor, said Canada has urbanized dramatically since the 1992 report, making it likely we’ll see whole new forms of transportation instead of subsidies or tax credits for coach companies.

“Presumably any service is better than no service. So my guess is everyone will be more open for more extermination,” he said. “It’s an open question as to what sort of package will help.”

— with files from Ben Waldman

dylan.robertson@freepress.mb.ca