Lawmakers call for fuel subsidies, citing loss-making bus service amid oil price spike

ABC Touring Car Company, a non-franchised bus firm, continues to operate rides at a loss after the government rejected its application to reduce its services.

Photo: Eugene Lee A Hong Kong coach operator’s failed attempt to reduce its services was only the “tip of the iceberg” of cuts in bus rides amid rising fuel costs, lawmakers have warned, as they urged the government to quickly address soaring oil prices.

Legislators on Tuesday also called on authorities to approve applications by non-franchised bus companies to increase fares, and to provide subsidies to cushion the effects of higher fuel prices caused by the war in the Middle East.

Their appeals came after the Transport Department rejected an application by ABC Touring Car Company, which operates routes between Tuen Mun and the city’s urban areas, to reduce its services on Sundays, on the grounds that the firm was required to provide 14 days’ notice.

The company had no choice but to absorb the losses and continue providing services. “All departures will stick to the usual schedule but as oil prices continue to rise, we continue to operate at a loss,” the company said in a Facebook post.

The company had originally planned to cut services on four residential bus routes it operates in Tuen Mun.

Lawmaker Mark Chong Ho-fung said that while the mechanism for approving to reduce services was reasonable to safeguard residents’ consumer rights, the government should adopt a “special arrangements for special circumstances” approach in the current situation.

Chong noted that distributors of industrial diesel – commonly known as “red oil” – claimed they had not experienced such volatility in two decades, with costs doubling since the US-Israel strikes on Iran on February 28.

Red oil is industrial diesel that has been dyed red to distinguish it as a tax-free fuel intended for marine, construction and industry use, rather than for private road vehicles.

In Hong Kong, this makes it a vital, lower-cost resource for services such as residential estate buses and ferries that depend on its low cost to remain financially viable. “The government should intervene and examine where the problem lies in the supply chain – whether it is high import costs or distributors taking excessive profit margins,” Chong said. “Fuel is a strategic commodity, and the government is not entirely without a role to play.

If the situation worsens, authorities could potentially request the central government to intervene and provide

原文链接: 南华早报