Until the new Public Transport Operating Model (PTOM) contracts take effect in mid-2018, NZ Bus will continue to operate all existing services in Wellington.
It is business as usual for the NZ Bus operation including its Valley Flyer services, and it is retaining all staff in the Wellington region on their current terms and conditions.
NZ Bus says it is committed to providing support and identifying any opportunities for redeployment leading up to the changes in mid-2018.
The bus company owned by Infratil says it will also be seeking clarification of the employment commitment to existing operator staff referred to in the Greater Wellington Regional Council media release.
“NZ Bus is committed to continuing to deliver high-quality public transport services in Wellington, and to being part of the future of public transport in New Zealand, says chief executive Zane Fulljames.
NZ Bus missed out on selection as a preferred tenderer for the three units of the Wellington city contracts it participated in for bus services.
There were nine units in total that were tendered by GWRC under PTOM. The preferred tenderers were Tranzit (NZ) who won eight of the nine units tendered and UZABus who won one unit.
GWRC has confirmed that NZ Bus remains the incumbent operator the four Directly Appointed Units (DAUs) in Wellington City enabling it to focus on its Go Wellington services.
These units are subject to price negotiation.
Under PTOM, a proportion of contracts are openly tendered while others are renewed with incumbent bus operators following direct negotiation.
The result of the Wellington tender process is consistent with Infratil’s recent market messaging on the expected future scale of the NZ Bus business and earnings guidance.
NZ Bus did not tender for the Hutt Valley contracts and undertook consultation with staff before it made this decision.
Fulljames says the company had to make strategic decisions about which PTOM tenders to bid for, on top of the DAUs, in the context of GWRC’s PTOM guideline that specified that no one bus operator is permitted to hold more than 60% of all services in the region.
“Given that NZ Bus currently holds contracts for over 80% of all bus services in the region, it was inevitable that we would hold fewer contracts at the conclusion of the PTOM tender process,” says Fulljames.
“We considered the pros and cons of bidding for all available contracts with the consequent risk of being awarded disparate units that inherently create inefficiencies, or tendering more selectively for specific units where there was the greatest opportunity to deliver business integration and efficiency,” he says.
“The four DAUs in the central city enable us to focus on maximising the efficiencies of our Go Wellington services,” says Fulljames.
