Monday, July 23, 2007

Tackling Blueline bus Menace in Delhi

The recent spurt of accidents involving blueline has led to a public outcry for ban on blueline buses. Recently technical checks and installation of speed governors has been started as solution towards this problem. It is rather strange that no authentic study has been carried out ( at least not in my knowledge) by transport experts or published in leading newspapers.



Why banning blueline is not the solution?



1. This is so for a number of reasons. Delhi's transport problem will need to be attended to. Banning these buses will initially lead to severe transport crises as seen in last few weeks followed by possible mushrooming of servcies by smaller carriers who may very end playing the role of the killer buses in more ways than one. Crowding of leftover buses etc may pose other forms of transport hazards.

2.Banned buses will be have to used some way as otherwise loss of capital will be involved not to mention loss of revenue, unemployment.

3. Bluelines are not MIG-21 where in latter technical problems are suspected.



While we do not have the data on blueline buses and staff, we believe it is the latter that needs more finetuning and not merely the buses. Problem of blueline buses may linked to nature of incentives under which these blueline buses operate that sets up worst form of competition among bus operators/owners.

The following is set of reasons which we think may be leading to rise in accidents

1. It is well known result in economic theory of sharecropping that a farmer who tills a land after paying a fixed rent for land to landowner will overuse the land beyond optimal levels. It may be the cse with blueline operators who may taken thse buses on fixed rent and trying to maximize revenue from these buses by over running the buses, by overextending the staff . Fast and reckless driving to catch the travellor victims on the route, maximizing trips with concomitant stress on driver/conductor may be the outcome of such incentives.secondly bus operators to drive down down cost may be hiring low cost low skill drivers with limited attention to bus maintenance. Hence there may be case for changing incentive structure under which the bluelines operate. ( after all why does DTC kill so few people??)


2. too many operators competing on a single route may also lead to adverse behaviour by blueline staff as they try to outdo each other in picking up as many helpless passengers as possible. This problem can be minimized but not eliminated altogether.

3. Blueline staff may be compensated every six months for "accident free half year" even compensation at rate of rs 500 per month for driver and conductor will be much less than compensation that goes for victims in every six month period. Some form of award is required

4. To knock off every blueline for accidents committed by a few buses is contravention of principle of justice not to mention the new and more severe problems that overall ban may give rise to particulalry since there is nothing technically wrong with design of blueline buses. Hence along with award for accident free months, severe monetary punishment (apart for everthing else) to owners/operators such as impounding of the bus for 1-2 years and handing it to other operators may lead owners to better choice of drivers/staff and bus maintenance

5 Lastly incentive schemes may need to be devised that will automaticaly reduce speed of buses without need for speed governors. Some schemes apart from point point 2 above are a.setting minimum duration for each trip b. setting maximum nuber of trips per day over 8-10 hours service per day wil lead operators/drivers to slow down during actual travel to pick up more passengers. However challenge for implementing such schemes remain and here technical soltions recently suggested using electronic chip on each bus ( which they cannot mess with) may be useful

....may be continued

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Saturday, July 21, 2007

How to tackle the Blueline menace?

An article with some ideas on the above subject will be posted by Monday. Article on customizing weight reduction programme will be posted end of this week (July 28-29)

Wednesday, July 4, 2007

Did you apply for DLF IPO?

In our previous article we advised buying Unitech rather than apply for DLF. Our first target has been met i.e a return of 8-10 % has been acheived for those who opted for Unitech.

However DLF IPO as far as retail portion has been concerned has been underscribed rather than overscribed. Hence the risk is not of low allocation but low listing price arising from under subscription & possible full allotment to retail subscribers.

It is unlikely that DLF IPO will give 10% return on day of listing ( see our DLF IPO listing prediction to be posted today at www.kal.in and www.astrogurus.com ) and even if it should rise to that or higher levels we believe that new buyers can enter at lower levels and enjoy the same profits as the original allottees - well almost.

Coming next: Customize your weight reduction programme/strategy- musing of an non expert
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