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Oct 27, 2004

Cabinet lays out strategy for bus industry

A release from the Prime Minister’s office indicates that cabinet is looking for ways to solve the ongoing problems caused by the bankruptcy of the Novelo?s Bus Line. Noting that a plan by a group of investors to take over the company has been withdrawn, a committee headed by Minster of Transport Cordel Hyde has made a recommendation that the Novelo?s nationwide franchise be divided into four. These would consist of the North, South, West and Belize City routes, the latter including cruise tours. These exclusive fifteen year franchises would be put out to tender, with the hope that existing small route operators would become involved in the purchase. At the same time the receiver currently running the company on behalf of D.F.C. and the Atlantic Group would sell the successful bidders assets related to running the routes in each zone, including buses and terminals. The buyers would also be required to make additional investments in better quality vehicles.

While the cabinet proposal makes good conceptual sense, its implementation will run headlong into some difficult realities: namely, that with forty million dollars in overdue debt and an inventory of aging metal, the Novelo?s Company?whether sold intact or in pieces?is just not worth that much money. The real question for cabinet will be exactly how much of D.F.C.’s securitized and government guaranteed loans it is willing to see written off to get the nation’s vital public transport system running on all cylinders.

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