Carrier Keolis has lost its concession for bus transport in IJssel-Vecht. Who will be hit the hardest?

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It was flawless tender fraud and a blunder. The consequences for bus operator Keolis were therefore far-reaching. On Tuesday, the three provinces of Gelderland, Flevoland and Overijssel decided to withdraw the recently granted concession – market value of approximately 900 million euros.

In September 2019, Keolis won the tender for the IJssel-Vecht concession. It was therefore allowed to provide bus transport in the region. The permit would take effect this year and last until the end of 2030. The tender, however, was fraudulent, as was revealed last May. The company secretly made arrangements with the Chinese bus builder BYD, which was not fair to competitors who also wanted to drive in the region.

In the public transport sector, this final phase of that tendering process is being watched with suspicion. In the first place because of the consequences for Keolis himself. The transport portfolio for the Eastern Netherlands accounts for a quarter of the company’s total turnover. Keolis has invested more than 100 million euros in new equipment and additional personnel, among other things. It could cost the company its head in this corona crisis: until last March, the public transport sector was a profitable growth market, due to corona the number of passengers has halved and the market is heavily loss-making.

Breather

According to those involved, including the Rover travel association, the question is whether the provinces do not cut their fingers with these sanctions. Will public transport and passengers in the region not also be the victim of the bill?

In 2015, the province of Limburg ran into tender fraud, in which NS subsidiary Abellio was involved. Limburg managed to quickly transfer that concession for public transport in the province, market value of about 2 billion euros, to its competitor. Passengers have hardly noticed the changing of the guard; bus and tram ran according to agreement in that concession.

The provinces in the eastern Netherlands opted for a different strategy. There, Bert Boerman, the responsible deputy in Overijssel, opted for a two-year breather. At that time, Keolis is allowed to provide public transport through an emergency concession and a new tendering procedure is being prepared.

The competition is temporarily sidelined by this temporary solution. Boerman chose the breather because he expects complex lawsuits from both Keolis and competitors Transdev, Arriva and EBS when the concession is relaunched. The deputy calls it bitten by the cat or by the dog. “But as a result, bus transport can be carried out as much as possible according to the agreed quality and service from December onwards, and the interests of the traveler are best safeguarded.”

It is a construction with significant financial consequences. The canceled concession dates from September last year, before the corona crisis. At that time, the public transport market was still a growth market, on which the return was also based.

For this year, the government will compensate for the resulting losses, including those of Keolis. But the government does not cover everything. Transport companies also continue to pay for their operating shortages themselves. The question is whether the shareholder of the French parent company, the Keolis group (formerly known as Syntus), will bear those costs. Because it is far from certain whether Keolis will be allowed to participate in the final tendering round.

It is far from certain whether Keolis will be allowed to participate in the new tender race

A spokesperson for the company says the shareholders are ultimately about that. Deputy Boerman admits through a spokesman that it is by no means certain that Keolis will start driving at the end of the year, when the current concession expires and the emergency concession begins: “There is still talk. And we also think about the scenario that we cannot resolve it. ”

Do not replace student buses

Last year, the continuity of public transport in the east of the Netherlands seemed to be guaranteed for ten years. Now the procurement fraud and the corona crisis throw a spanner in the works. In the short term, travelers will be the victim, predicts director Freek Bos of the Rover travelers association. “It is not feasible to start a new concession in four months. That means bus lines that will not run frequently and student buses that cannot be replaced in time. ”

And in two years? The question then is whether foreign parties in the post-corona period find the public transport market in the east of the country interesting enough to invest in it. Competition awaits market development and the corona crisis. “Consolidation of the own market is now a priority,” said a spokesman for bus company Qbuzz, which mainly operates in the Utrecht region. Transdev CEO Pier Eringa was not eager to take over from Keolis now or later in May. “Then I say thank you, but not under the conditions of that time. Corona has changed everything. ”

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