11 BUS
Urban bus services
The number of bus users in Japans three major cities continues to decline since peaking in 1972. The decrease is due to the development of subways / light-transit systems, worsening traffic congestion, and heightened public awareness of health issues. Traffic congestion lowers the operation efficiency of bus services and increases the weight of labor costs, straining the management of urban bus businesses, especially publicly-run services which have high labor costs. This is why an increasing number of cities, such as Hamamatsu and Yamaguchi, are transferring their deficit-ridden bus operations to existing private companies. Many businesses are taking steps to streamline management and increase users, such as reviewing service routes, introducing new types of buses, installing bus location systems, and marketing pre-paid cards that can be used for routes run by different companies. However, these efforts have yet to lead to a recovery in the number of bus users.
Rural bus services
In rural areas, the number of bus users peaked in 1969 and has since plummeted to less than half the peak figure, amidst the increasing use of private vehicles and depopulation in rural communities. As a result, over 80% Of rural passenger bus routes are operating in deficit. Their operation is supported by subsidies from the central and local governments, or supplemented by cross-subsidization diverted from more profitable divisions such as express bus services. Under the current system, subsidies will be canceled in five years for routes with average passenger densities of less than five. In some such cases, local governments will operate substitute bus services themselves or offer limited bus licenses to taxi / charter bus companies allowing them to run bus services instead. There is also a move among private companies to branch out into spin off their bus operation divisions to cut costs.
