Analysis of the operational and financial performance of the Addis Ababa municipality-owned public bus transport services

Abstract

Improving operational performance is the key concern for the transportation sector in emerging countries. In Addis Ababa, the majority of the transit service was provided by municipally owned public bus transportation companies such as Anbessa and Sheger Transport Service Enterprises. This study examined the operators’ operational and financial performance in comparison to industry standards. The ratio analysis approach was utilized to examine secondary data from 2016/17 to 2021/2022, which was employed in the study. The overall findings indicate that, despite differences in operational safety and employee productivity, the Anbessa city bus outperforms the Sheger city bus in some parameters, such as fleet utilization, vehicle usage, and service utilization. However, Sheger city bus outperforms its competitor in terms of operational safety and bus staffing levels. Finally, a majority of the data indicates that the operators’ performance fell short of industry standards. To improve their financial and operational performance and continue offering services that fall short of those provided by other companies in the city, bus transit companies, which receive government subsidies to operate their services, must significantly improve how they use their resource. Furthermore, the municipality should offer subsidies and other incentives based on the genuine company’s performance.