{"id":302485,"date":"2022-08-10T04:03:28","date_gmt":"2022-08-10T02:03:28","guid":{"rendered":"https:\/\/novanews.co.za\/bloemnewsexpress\/tightrope-for-bus-company-20220808\/"},"modified":"2022-08-10T04:03:28","modified_gmt":"2022-08-10T02:03:28","slug":"tightrope-for-bus-company-20220808","status":"publish","type":"post","link":"https:\/\/novanews.co.za\/bloemnewsexpress\/tightrope-for-bus-company-20220808\/","title":{"rendered":"Tightrope for bus company"},"content":{"rendered":"\n

Despite Interstate Bus Lines\u2019 (IBL) increase in tariffs increased <\/span>and government subsidy for the financial term, is <\/span>it is faced with a prospect to alter its business strategy to cushion the business to <\/span>provide much-needed service. Both tariffs and government subsidy are lower than three previous years. <\/p>\n\n\n\n

The company\u2019s subsidy from government for the current financial year dropped by 0,5%, while the tariff increase is a lower than expected, at 6%.<\/p>\n\n\n\n

According to George Mokgothu, chief executive officer, combined, the current increase in tariffs and subsidy is insufficient to offset the 43% increase in fuel expenses. <\/p>\n\n\n\n

\u201cSubsidy accounts for 45% of our total revenue, and this year it has dropped by 0,5%, which equates to a R1,1million per month. Fuel increases account for a R4 million month-to-month, and this is over expenditure when compared to last year. These figures exclude the overall increase in spares, such as bus tyres,\u201d said Mokgothu.<\/p>\n\n\n\n

Government\u2019s subsidy increased by a mere 3,2% for 2018-\u201919, while it was 5,2% in 2017-\u201918.<\/p>\n\n\n\n

Mokgothu explained that tyres remained an increasing expense as a result of<\/span>due to the bad conditions of the roads they were using in the greater Mangaung region.<\/p>\n\n\n\n

\n Part of keeping the business afloat, the company\u2019s m<\/span>Management must still consider salary increases above inflationary rates. <\/p>\n\n\n\n

Mokgothu pointed out that this year\u2019s annual price increases by IBL was still below also below than <\/span>below the previous three years and also below the 7%, which other bus companies implemented in December 2021, and 8% increase in March 2022.<\/p>\n","protected":false},"excerpt":{"rendered":"

Despite Interstate Bus Lines\u2019 (IBL) increase in tariffs increased and government subsidy for the financial term, is it is faced with a prospect to alter its business strategy to cushion the business to provide much-needed service. 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