History repeating: Red Bus loses out in Greater Christchurch bus shake-up

Thursday, 27 February 2020

Red Bus has lost out on winning contracts for three major urban bus units, comprising 13 routes, including the orbiter, orange and blue lines. (Video first published on February 27, 2020)

City council-owned Red Bus has lost out in a significant refresh of Greater Christchurch bus contracts, which will result in more electric and low emissions buses.

Environment Canterbury (ECan) announced on Thursday Go Bus had won contracts for the three urban bus units – comprising 13 routes including the orbiter, orange and blue lines – which were put to tender last year, taking their share of the urban network to 80 per cent. Red Bus had tendered for all the units, and also lost out on school bus services, which went to Ritchies Transport.

Red Bus kept 20 per cent of the urban market, but got none of the additional routes it tendered for.

It keeps 20 per cent of the urban network as a result of previous negotiations which secured it one unit comprising five routes, including the purple line. While the tender outcome is a significant setback for the company, ECan have trumpeted the environmental, service and financial benefits the new contracts will bring.

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The news came as a shock to Red Bus workers, Amalgamated Workers Union assistant secretary Lindsay Chappell says.

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There are about 200 buses in the urban fleet. ECan said the new contracts would add 25 new electric buses and 39 new low emission Euro 6 buses in the first year. With three existing electric vehicles, it will mean 14 per cent of the fleet will be emissions free. More than half the new vehicles will be manufactured in Rolleston.

Red Bus staff leave a meeting after being told the company has massively lost out on Christchurch bus routes.

ECan senior manager public transport Stewart Gibbon said the council had wanted to immediately replace a further 28 vehicles with Euro 6 buses, but agreed to replace them within the first two years instead to give the council time to see if ratepayers wanted them to be zero emission.

The new contracts start in November and last for nine years with a provision to extend them for another six years, subject to performance criteria. Gibbon said the lifespan of a diesel bus was about 25 years. Of the current fleet, he estimated about 35 per cent would still be running by the time the nine years was up, meaning Christchurch would still have a large number of diesel buses at the end of the 2020s.

Applicants had to submit an all EV bid as part of the tender process. Gibbon said making the shift at once was too cost prohibitive. 'It is true to say that the all EV option from all the tenderers was beyond our financial threshold.'

Red Bus chief executive Paul McNoe says it's a 'disappointing outcome' for the company.

Go Bus was a better option than Red Bus and other tenderers across a range of criteria, he said. While the new contracts aimed to minimise route or frequency changes, ECan would have the ability to make changes that came out of business cases currently under way to improve public transport.

Red Bus chief executive Paul McNoe broke the news to the company's bus drivers at a meeting on Thursday morning. One driver told Stuff: 'You know what it's like, we've been gagged. We can't say anything.'

Amalgamated Workers Union assistant secretary Lindsay Chappell, who attended the meeting, said the news came as a shock and the mood in the meeting was solemn.

Red Bus has lost out on Christchurch bus routes as part of an Environment Canterbury tender process.

'They're feeling like they've been kicked in the guts,' he said.

'We're unsure of the numbers at this time, but there could be between 30-60 job losses. We're hopeful the large majority will be able to retain their roles as drivers, albeit with the successful tenderer.'

McNoe said as part of the tender process there was an agreement between the companies involved to transition routes and people smoothly between them.

Before the tender, McNoe said Red Bus had 28 per cent of the vehicles operating on the urban routes. This had dropped to 20 per cent as a result of the tender, meaning the company now had 17 surplus vehicles. 'We will sell them,' he said.

'We were looking to grow our business, and what has happened is the business has shrunk to some extent. So that's a disappointing outcome.'

Red Bus chief executive Paul McNoe told drivers on Thursday the company had lost routes in the tender process.

Among the other contract outcomes were interior upgrades for all new buses after eight to 10 years of services, air conditioning on all new vehicles, three bike racks on all new vehicles and replacements, and copper-free brake pads for all new vehicles.

ECan deputy chair Peter Scott said its decision would transform public transport with new, modern buses and reduced carbon emissions.

A regional public transport plan requires all vehicles bought after 2025 to be low emission. ECan was criticised during the tender process because it would not accept bids from operators wanting to use only electric vehicles, despite the council calling a climate emergency just months before.

Scott said buying an an entire fleet of electric vehicles would be 'fiscally irresponsible' as better technologies would be available in the future.

AT A GLANCE

The new contracts include:

- 64 new vehicles brought in over November 2021 to November 2022: 25 electric and 39 low emission Euro 6. There are three electric vehicles in the fleet already, so these additions will mean 14 per cent of the entire fleet would be electric.

- Another 28 vehicles replaced in the first two years.

- Bigger buses on some high-use routes.

- Interior upgrades for all buses used for eight to 10 years.

- Air conditioning on all new vehicles.

- Three bike racks on all new vehicles and replacements.

- USB ports on all new vehicles.

- Copper-free brake pads for all new vehicles, which reduces stormwater contamination.

- Fleet profile modelling estimates a reduction in CO2 emissions of 14 per cent and PM10 emissions of 25 per cent in the first year.

- The total cost of the contracts (excluding the Diamond Harbour ferry service) is $61.5 million – a $2.2m increase (3.7 per cent) on the current price.

BUS USE DECLINING

Public transport usage in Greater Christchurch and Timaru decreased by 3.5 per cent from July 1 to December 31, 2019, compared to the same period the year before, driven by lower patronage in Christchurch.

In the 2018-19 financial year, there were just under 14 million trips taken – a number patronage has hovered about since 2013-14, despite population increases in Christchurch.

ECan is proposing an average rates increase of 9.8 per cent in its 2020-21 draft annual plan, up from the 5.5 per cent previously forecast. The increase is partly due to increased public transport spending.