The Mayor of Vélez-Málaga, Francisco Delgado, has described the situation regarding the Tranvia tram system as ‘very worrying’ and is not averse to the idea of stopping the service if solutions are not forthcoming.
At the end of 2007, the company running the service, TRAVELSA, has made a loss of around €1 million and the Council has run up debts of about €700,000. Predictions for 2008 see TRAVELSA losing about €1.2 million and, if the proposed extension to the service goes ahead, the Council debt could double.
There appear to be several reasons why the Tranvia is in the poor financial state it’s in. In order to maintain an artificially low ticket price of €1.30 for the consumer, the Council pays a subsidy of €0.12 per ticket. In addition, a ‘target’ was set for actual passenger numbers with the Council liable to pay the full ticket price of €1.42 for any shortfall. The 2007 shortfall was 213,149 passengers!
If the proposed extension were to go ahead, a 1,300 metre section, the ‘real’ ticket price would rise to €2.60 and the Council could end up doubling it’s deficit. It would seem that the original economic calculations upon which agreements were based were rather on the inaccurate side and forecast passenger numbers rather on the optimistic or unrealistic side.
The mayor would like to see a resolution to the current problems before any extension to the service is contemplated or implemented. Whilst agreeing that public transport systems never make any money, he also believes that they should not end up bankrupting a municipality, especially through the use of erroneous data.