How bus firms are adjusting to competition from SGR

Dar es Salaam. In response to the growing popularity of electric trains on the standard gauge railway (SGR), Tanzanian bus operators are devising strategies to stay afloat.

The introduction of the SGR has prompted several bus companies to diversify their routes and invest in new buses to cater for regions not covered by the new rail network.

Companies such as Kimbinyiko, BM Coach, Abood and Shabiby have begun expanding their services to new destinations, including Sumbawanga, Bukoba, Musoma and even Kenya.

These adjustments are aimed at recapturing market share and maintaining their business operations amid the shifting transportation landscape.

The SGR, which began operations recently, has quickly gained traction, with over 7,000 passengers using the service daily between Dar es Salaam, Morogoro and Dodoma. The increased efficiency and appeal of the rail network have led to a decrease in bus travel on these routes.

But bus operators who have been largely dependent on the routes have put on a brave face, saying Tanzania is too big for the SGR alone to cover.

With a surface area of 945,087 square kilometres, Tanzania is larger than Kenya, Uganda, Burundi and Rwanda combined.

The four other countries’ combined surface area stands at 877,852 square kilometres, with Kenya and Uganda accounting for 582,646 square kilometres and 241,038 square kilometres, respectively.

Sharing borders with seven countries, two of them being landlocked ones that depend on Tanzania’s ports for their international trade, gives the country’s transporters another business massive business opportunity to utilise.

In light of this, Kimbinyiko Bus Company director Ferdinand Mabumo told The Citizen that the company has introduced four new routes to adapt to the changing market.

“We have reduced trips between Dar es Salaam and Dodoma from ten to four per day,” he noted.

The new routes now include Dodoma-Arusha, Arusha-Mbeya, Dodoma-Njombe and Moshi-Mbeya. The company’s future plans are to expand to Nairobi, Kenya.

Shabiby Bus Company manager Edward Magawa emphasised the importance of broadening their service areas. “Tanzania is vast and while there is still demand for travel from Dar es Salaam to Dodoma, we are focusing on new routes like Dodoma-Sumbawanga, Dodoma-Bukoba and Dodoma-Musoma,” he said. Shabiby has also ordered new buses that are expected to arrive by mid-October to support these expanded routes.

BM Coach has ventured into cross-border services, launching a new route between Dar es Salaam and Nairobi on September 4.

“This is a pilot project with plans to extend to Kampala and Rwanda,” said BM Coach operations manager Gabriel Makundi.

The company will run four trips per day on this route and is considering adding the Dar es Salaam-Tunduma route in the near future.

Prior to the SGR’s introduction, BM Coach operated up to 22 buses daily on the Dar es Salaam-Morogoro route and ten on the Dar es Salaam-Dodoma route. However, the rise of the rail service has led to a significant reduction, with only six buses now serving the Dar es Salaam-Morogoro route and four on the Dar es Salaam-Dodoma route.

Despite the challenges posed by the SGR, Tanzanian bus operators are leveraging their flexibility and expanding their routes to ensure they remain an integral part of the country’s transportation network.

BRT alternative

The bus owners say they are keen to invest in the Bus Rapid Transit (BRT) project in as long as improvements are made to fare collection and operating contracts.

The Tanzania Bus Owners Association (Taboa) is advocating for greater involvement in the BRT system to sustain their businesses as the railway network reshapes the transport sector.

Taboa secretary-general Priscus Joseph told The Citizen that discussions with the Dar es Salaam Rapid Transit Agency (Dart) took place in 2022. During the talks, bus operators proposed purchasing buses to operate within the BRT infrastructure but have yet to receive feedback. “We suggested allowing us to invest in buses while the government retains the infrastructure, but there has been no response,” he said.

The BRT project, which is being rolled out in phases, has faced logistical challenges. BRT Phase I, which began in 2016, was intended to operate with 305 buses but currently has only 210, many of which are damaged. Phase II of the BRT, completed in October last year, is awaiting the arrival of new buses.

Earlier this month (September), the Minister of State in the President’s Office (Regional Administration and Local Government), Mr Mohamed Mchengerwa, urged the Dart and Udart to collaborate on integrating upcountry operators into the BRT system to enhance commuter services rather than waiting for foreign investors.

Speaking when he launched smart cards and smart gates at BRT stations in Dar es Salaam, Mr Mchengerwa said the commencement of electric-powered train services on the SGR has affected some upcountry business operators. As a result, it would be considered to operate within the BRT corridor.

“The issue of buses has been discussed for a long time. BRT Phase I still requires 170 buses to operate efficiently and 500 buses are needed to begin operations for BRT Phase II on the Mbagala route. Ensure that the buses are procured by December this year,” he said earlier this month.

Mr Mchengerwa said, “The bus upcountry operators, who have been transporting passengers for years and years, can work efficiently in BRT corridors. As such, call local operators to invest in the BRT instead of waiting for foreign investors”.
And, according to Mr Makundi, much as bus owners are ready and willing to take up the assignment, there was the need for clarity on the tendering process for BRT operations. “An official tender announcement should be made to outline the requirements for upcountry buses to participate in the BRT system,” he urged.

Similarly, Mr Magawa of Shabiby expressed the company’s readiness to invest in BRT but stressed the need for fare reviews and conducive investment conditions.

Dart chief executive Athumani Kihamia acknowledged the 2022 discussions with bus operators but noted that consensus was not reached.

“We are planning to engage with more operators to explain our progress and address concerns,” he said.

Taboa communications director Mustapha Mwalango reported a noticeable decline in passenger numbers and an increase in idle buses. “The SGR has impacted our operations more than we initially anticipated,” he said.

Latra head of communications Salim Pazzy suggested that bus operators view the SGR as an opportunity rather than a threat. He noted that with the SGR serving as a central hub, there would be increased demand for buses to transport passengers from Dodoma to other regions.

Latra road transport director Johansen Kahatano confirmed the reduction in bus services. “Our surveys show a decrease in bus trips and passenger numbers since the SGR began. We are working on strategies to mitigate these impacts,” Kahatano said.

In response, Latra plans to organize a stakeholders meeting with transporters and Tanzania Railways Corporation (TRC) to explore ways to improve connectivity and reduce passenger costs.

The meeting will focus on finding solutions to enhance the integration of bus and rail services, particularly near SGR stations.

As the transport sector evolves, bus operators remain hopeful that increased collaboration and strategic planning will enable them to continue providing vital services across Tanzania.