In 1996, Sri Lanka had a mixed public and private bus system, with about a third of passengers by public enterprises and two thirds by private. The private buses were not earning enough of passenger charges to replace their buses and as a result there were many complaints of overcrowding and safety problems. Public buses they did mainly because it was free buses from the government. Improving the bus service was crucial for the country since about 80 percent of the motor … Read more »

In 1996, Sri Lanka had a mixed public and private bus system, with about a third of passengers by public enterprises and two thirds by private. The private buses were not earning enough of passenger charges to replace their buses and as a result there were many complaints of overcrowding and safety problems. Public buses they did mainly because it was free buses from the government. Improving the bus service was crucial for the country to be transported for about 80 percent of motorized passenger trips by bus. The government was considering a number of reforms, including tariff increases and consolidation of small public and private operators. This case can be used to discuss the policy and the reasons for the regulation and privatization. And the case describes a 90-year history of privatization, nationalization and re-privatization of the bus industry. HKS case number 1377.0.
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Jose Gomez-Ibanez
39 pages.
Release Date: 1 January 1997. Prod #: HKS058-PDF-ENG
Sri Lanka Transport (A): The Bus Industry HBR case solution