
Is public transport meant to turn a profit? Five countries show it's not that simple
The assertion again sparked a debate about who will fund these projects.
Public transportation systems in Malaysia have long depended on government subsidies.
But over the years, the discourse around public transit has included support for privatisation, the thinking being profitability — or at least break even — would make operators innovate and become more financially independent.
Experiences of other countries, however, show that the issue around public transport funding is usually more complicated. Some countries have tried privatisation, but not all have enjoyed positive outcomes.
'Public transport is a social service'
In Malaysia, policymakers are divided, although many are inclined to view public transport as a social service that should be financially backed by taxpayers.
'In my experience, return on investment is not the issue. The issue of efficiency and funds for expansion of services normally arises,' said Rajiv Risyakaran, the pro-public transport Bukit Gasing state assemblyman who had been involved in Selangor's city and town planning.
'I don't expect public transport to break even or be profitable. It's a social service the government provides for the people, and it's a net cost to the government.
So, are there countries where public transport operators make money?
Malay Mail looks at five countries with arguably the best public transportation systems, and analyses open-source information to see if operators there are financially self-reliant or subsidy-dependent.
People walk past signs for the Tokyo Metro underground system inside Shimbashi Station in central Tokyo in this file photo taken on October 21, 2024. — AFP pic
Japan
Japan's public transport systems, particularly its rail networks, are known to be among the most efficient in the world.
The train operations, including the famous Shinkansen (bullet train), are incredibly punctual with minimal delays.
Japan's rail networks, among the world's most complex, were initially operated by public and private companies, but in the 1980s, policy favouring car ownership plunged the government-run entity Japanese Railways (JR) into heavy debt. This pushed JR to privatise by splitting into regional-based companies (JR East, JR West, JR Central and JR Kyushu) that gave it flexibility to tailor the unique needs of the service areas.
Today, the Japanese privatisation programme is the exception in terms of profitability. But ticket sales are not the only income source.
A key to its success is diversification into real estate and retail businesses around its stations, according to the World Bank.
A file photograph shows public busses in Singapore. — TODAY pic
Singapore
Singapore's public transport system is internationally renowned, and public transport operators like SBS Transit in Singapore have shown to make profits according to media reports citing financial records.
But Singapore operates through a unique model where the government often owns the infrastructure, such as tracks and stations, and the operators lease or run services on it.
This helps manage the massive capital expenditure.
Switzerland
The Swiss public transport network, which includes rail systems, taxis, and buses has a total length of 24,500 kilometres and has more than 2,600 stations and stops, some even cutting across the Swiss Alps.
The Swiss Federal Railways (SBB), the national railway operator, has seen a return to profit in recent years after pandemic-related losses, according to official statements published on a government website, but like Japan, much of the profit comes from diversification of income sources like rentals from real estate and its energy divisions.
Generally, public transport operators there still rely on government subsidies to stay afloat, with half of their operating costs funded by taxpayers.
Germany
Germany's public transport system is a mix of public and private ownership, with the federal government, state governments, and private companies all playing a role.
Local public transport, including buses, trams, and some regional trains, is primarily managed by state governments and municipalities.
Deutsche Bahn (DB) is the main railway provider, a state-owned company, but it operates as a private entity and faces competition from other private companies such as SWEG, ODEG, and Flixtrain.
Still, many of the operators rely heavily on federal subsidies.
In 2021, at least 11.6 billion euros in federal funds were reported to have been invested in public transport, with more promised annually starting in 2025.
Over the years, there has been growing criticism over the funding model.
Travellers wait at the Eindhoven Airport. — AFP pic
Netherlands
Dutch public transport is frequently ranked among the best in the world for being well-organised, efficient, reliable, and covers the entire country.
Its transport system is known for its integration of trains, buses, trams, and metros, making it easy to travel between cities and within urban areas.
Like Germany and Switzerland, Dutch public transport operators rely heavily on government subsidies.
But unlike Germany, there is strong public support for financial assistance of public transit systems because they view it as a social service first.
Public transport in the Netherlands is funded through a combination of ticket revenue, government subsidies, and sometimes regional or local government contributions.
Hashtags

Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles

Barnama
34 minutes ago
- Barnama
PM Anwar Chairs 146th Meeting Of Menteri Besar, Chief Ministers
KUALA LUMPUR, July 14 (Bernama) -- Prime Minister Datuk Seri Anwar Ibrahim chaired the 146th Meeting of Menteri Besar and Chief Ministers in Putrajaya today. In a Facebook post, Anwar said the meeting serves as an essential platform to strengthen cooperation between the federal and state governments, particularly in coordinating policies and development initiatives. 'Through this synergy, we can ensure the smooth, comprehensive and inclusive implementation of the national development agenda for the well-being of the people and the overall progress of Malaysia,' he said.


New Straits Times
an hour ago
- New Straits Times
Petronas, Baker Hughes partner on Asia energy growth, transition
KUALA LUMPUR: Petroliam Nasional Bhd (Petronas) and Nasdaq-listed energy technology firm Baker Hughes have signed a memorandum of understanding to jointly explore business opportunities aimed at advancing Asia's energy expansion and transition goals. Under the agreement, both companies will work together to enhance liquefied natural gas services and cross-border talent development, strengthening local operational capabilities across the region. They will also explore digital and artificial intelligence-driven energy solutions, promote sustainable technologies in carbon capture, utilisation and storage, and together expand the use of biofuels and lubricants in the turbomachinery supply chain. Petronas senior vice president of projects, technology and health, safety, security and environment Mohd Yusri Mohamed Yusof said the expanded partnership would enable both companies to accelerate decarbonisation and innovation in energy delivery. "Our extended strategic partnership with Baker Hughes is poised to drive excellence in project delivery, decarbonisation, supply chain resilience, and technology adoption. "It signifies what is possible when two industry leaders unite to foster innovation ecosystems and shape the future of energy. Furthermore, the setting up of an enhanced aeroderivative facility here is a positive development towards the region's cleaner energy pursuit," he said in a statement today. Baker Hughes chairman and chief executive officer Lorenzo Simonelli said this collaboration is an important step to grow alongside customers in Asia-Pacific and also a localisation effort in developing reliable, secure and lower-carbon energy. As a first step, the firm plans to expand its gas technology services facility in Malaysia to include a full aeroderivative gas turbine module repair service, covering disassembly, assembly, grinding, and testing capabilities, which will support over 600 installed gas turbines in the region. Baker Hughes currently operates two turbomachinery facilities in Port Klang and a Kuala Lumpur-based iCenter that provides diagnostics for turbomachinery equipment. The company is assessing the best location for its new expanded gas turbine services footprint in Malaysia.


Malaysian Reserve
an hour ago
- Malaysian Reserve
Malaysia launches green hydrogen hub, hybrid hydro-floating solar project in Terengganu
by SHAUQI WAHAB MALAYSIA has unveiled the Hybrid Hydro Floating Solar (HHFS) project and a Green Hydrogen Hub in Terengganu, marking a significant step towards the country's clean energy ambitions. Jointly spearheaded by Tenaga Nasional Bhd (TNB), Petroliam Nasional Bhd (Petronas) and Terengganu Inc, these initiatives align with the National Energy Transition Roadmap (NETR) and the Hydrogen Economy and Technology Roadmap (HETR), reinforcing Malaysia's commitment to renewable energy (RE) and a low-carbon future. The launch ceremony, held on July 12 at the Sultan Mahmud Hydro Electric Power Station in Kenyir, was officiated by Prime Minister (PM) Datuk Seri Anwar Ibrahim. Also present were Terengganu Mentri Besar (MB) Datuk Seri Ahmad Samsuri Mokhtar, Energy Transition and Water Transformation (PETRA) Deputy Minister Akmal Nasrullah Mohd Nasir and top executives from TNB, Petronas and Terengganu Inc. The Green Hydrogen Hub is a strategic collaboration between Petronas and TNB. Both entities will work together to develop green hydrogen and its derivatives, while TNB strengthens grid infrastructure to support national and regional clean energy growth. At the same time, the HHFS project is led by TNB's generation arm, TNB Genco, in collaboration with Terengganu Inc, the state's investment body. The project will use Kenyir's hydroelectric reservoir as a platform for floating solar photovoltaic panels—part of TNB's broader 2.5-gigawatt (GW) hybrid solar-hydro initiative. Anwar noted that it is part of ongoing research leading to new, clean, and green alternative energy sources that have been agreed upon at the international level. He also commended the speed and efficiency of the HHFS and green hydrogen projects in Kenyir, which have outpaced other similar initiatives in the region. Anwar also said the project has a 500GWs potential, reaching up to 2,000 or even 2,500GWs, poised for major contribution to the nation and the region. 'It proves Malaysia's capability to lead in green energy — advanced, strong and forward-looking,' he said. Akmal Nasrullah commended Anwar's efforts of highlighting the energy transition agenda at the international stage. 'The PM was also the catalyst for the splendid collaboration between TNB and Petronas, thanks to his recommendation and vision,' he said. Meanwhile, TNB president and CEO Datuk Megat Jalaluddin Megat Hassan shared that the Kenyir HHFS project exemplifies how TNB is leveraging its existing assets to maximise renewable output. The Terengganu green hydrogen hub will be developed within the Kenyir-Kertih corridor, combining TNB's renewable generation assets and Petronas' industrial infrastructure. It will support a 24/7 RE generation from the Kenyir HHFS project while maintaining green hydrogen production, powered by electrolysers. Besides, it will also contribute to downstream products such as green methanol and green ammonia, followed by carbon capture, utilisation and storage (CCUS) infrastructure in Kertih. This integrated end-to-end ecosystem will be the first of its kind and scale in Malaysia and aims to enable cross-sectoral decarbonisation.