As Philippines scraps jeepneys, operators struggle with costs

February 28, 2023 - 8:44 AM
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In this traditional jeepney garage in Marikina City, drivers who were forced off the road due to Covid-19 restrictions also use their units as temporary home. September 16, 2022. PARA - Advocates for Inclusive (Transport/Handout via Thomson Reuters Foundation)
  • Iconic – and polluting – Jeepneys ordered off the road
  • Government sets new deadline for bus upgrades
  • Drivers, operators say scheme pushes them into debt

 — Brightly painted Jeepney public transport trucks are an iconic symbol of the Philippines, but minibus firm boss Freddie Hernandez backs plans to force them off the road.

He was among the first transport operators to comply with government orders to phase out the beloved but elderly utility vehicles and replace them with safer, greener buses.

“We saw the benefits of modernizing our units in terms of reducing their carbon emissions,” said Hernandez, the chair of a transport service cooperative in Metro Manila, an urban sprawl of 16 cities.

“If the environment benefits from it, the public will benefit from it as well in the long run.”

Other public transport leaders, however, say the program is saddling them with unmanageable costs and will upend the livelihood of some 61,000 traditional jeepney drivers, as they face a looming deadline to modernize their fleets.

Jeepney mini-trucks were originally created from abandoned U.S. military jeeps after World War Twoand later reproduced by Filipinos to meet Manila’s transport needs.

The open-air minibuses, which are festooned with bright decorations, pictures and slogans, are commonly known as the “Kings of the Road” and are the most popular form of public transport in the country.

But they have been pinpointed as a major pollution source, accounting for almost half of airborne particulate matter in the Metro Manila region, according to a 2018 study by the National Center for Transportation Studies at the University of the Philippines.

In 2017, the transport ministry ordered jeepneys aged 15 years or older to be replaced with modern vehicles imported from neighboring Asian countries such as Japan and China.

The government has extended an initial deadline of March 2020 three times due to the COVID-19 pandemic, but on Feb. 21 it announced operators must comply by June 30, or risk losing their franchise to operate.

Transport operators said the program is pushing them into debt through hefty loans and maintenance issues, and have urged officials to rethink their plans.

A spokesperson for the Land Transportation Franchising and Regulatory Board (LTFRB), the program’s implementing agency, said it was supporting jeepney operators with subsidies towards new vehicles. Those giving up their transport franchises would get “social support”, he said, such as free skills training and other work opportunities.

The agency has also said it is asking government banks to speed up loan approvals.

Despite backing the plan, Hernandez said his cooperative is struggling with the upgrade costs, which come as they reel from a decline in passengers due to the pandemic and high fuel prices.

One modern jeepney in his fleet normally earns 6,000 pesos ($110) per day for 12-km (7.5-mile) route.

But diesel consumption alone averages 2,500 pesos daily, he said, leaving them with only about 3,500 to pay for the loans, salaries and maintenance.

Painful upgrade costs

So far, 60% of the 185,000 elderly jeepneys have been replaced, said LTFRB head Teofilo Guadiz III.

“We do not want any of them to be left behind,” he said.

With the initiative driving down the value of jeepneys, drivers and operators are now forced to sell their cherished buses at dirt cheap prices, or for 20,000 to 30,000 pesos at scrap firms.

The government’s approved list of replacement buses, meanwhile, cost as much as 2.8 million pesos each.

At the start of the program, the government offered 80,000-peso subsidies towards upgrades. Despite doubling the subsidy in 2020, the cost remains too steep for many jeepney owners.

To qualify for government bank loans and subsidies, drivers and small-time operators must join or form cooperatives or corporations, which will own both the buses and their public franchises to operate.

Bus operator Ricardo Rebano said his corporation took out a 34-million-peso loan from the state-operated bank to pay for 15 modern jeepneys, but it was now struggling to meet repayments and interest on top of fuel costs and workers’ salaries.

“The cost is too much; it’s already hurting us,” said Rebanowho is also president of the Federation of Jeepney Operators and Drivers Association of the Philippines, a group advocating for transport workers’ rights and welfare.

Worse still, he said the imported new buses had developed engine, air con and transmission problems.

“(The supplier) doesn’t immediately respond to our issues. So, the broken units will remain unused and unprofitable,” he told the Thomson Reuters Foundation.

“How can we pay our loans if the situation is like this?”

Transport unions urge rethink

Even the new buses’ parts are controlled by big corporations and are more expensive to replace, said Mody Floranda, leader of Piston, one of the largest associations of jeepney drivers in the country.

For small-time operators, he saidthis could spell more loans and the risk of bankruptcy.

Philippine trade unions said the modernization program will result in their “wholesale disenfranchisement” in a report last month to the U.N.’s International Labor Organization.

They described it as a form of state violence toward informal passenger transport workers who have a hand-to-mouth existence.

In a 2021 position paper on jeepney modernizationthe Move As One Coalition, a group of Filipino sustainable mobility advocates and researchers, also urged “a just and socially inclusive path” to improving public transport services.

With the upgrade program under scrutiny, transport workers urged the government to rethink.

“We are not against modernization,” said Floranda.

“Why can’t the government support local manufacturers to come up with cheaper transport units instead of importing costly and outdated models from other countries?

($1 = 55.0200 Philippine pesos)

—Reporting by Mariejo Ramos; Editing by Sonia Elks