LETTER | Tour bus operators must offer convincing reasons

LETTER | According to the Malaysian Inbound Tourism Association (Mita), there are 9,000 tour buses in Malaysia which are financed by credit and leasing companies. Some Mita members have 100 tour buses and all have to pay credit and leasing companies RM10,000 monthly per bus.

However, tour bus operators are unable to pay as they have no income since the movement control order (MCO) was imposed on March 18. The current conditional MCO will expire on June 9 but may be extended if need be. And even if lifted, the volume of business for the rest of the year will be insufficient to pay for monthly instalments.

Hence, Mita is calling on credit and leasing companies to offer a moratorium to its tour bus operator members and held a meeting with the Special Task Force to Facilitate Business (Pemudah) and hope that the issue will be brought to the cabinet.

Earlier, Mita had appealed to the Housing and Local Government Ministry to intervene and urge credit and leasing companies to offer a flexible repayment scheme, as most are offering a much shorter moratorium than banks, which had been directed by Bank Negara to grant six months moratoriums for all loans including hire purchase.

While many sectors are expected to gradually recover after conditional MCO, tourism business is going to take a much longer time as many countries remain under lockdown, and borders will again be closed in the event of a sudden outbreak within or in a neighbouring country. In any case, the small number of tourists to Malaysia expected for the rest of the year and the whole of 2021 will not require the use of all existing tour buses in the country.

Leasing companies are aware that most tour bus operators will not be able to earn enough until the end of next year to pay monthly instalments. If so, it serves no purpose to offer an extended moratorium across the board, unless Mita or individual tour bus operators can provide convincing reasons that their business will soon rebound.

It should be noted that lessors would rather have lessees continue with leasing as repossessing the vehicles would be lossmaking, as market value for tour buses would be low. But delaying action would amount to greater losses, more so when a large number of tour buses are repossessed around the same time, with those in the poorest condition sold as scrap iron.

Interestingly, the Land Public Transport Agency issued a notice on May 22 that the Transport Ministry has agreed to allow school and tour bus operators to apply for lesen perubahan sementara (temporary change licence) to provide bas pekerja (worker bus) service for not more than three months.

If this is because worker buses are currently permitted to carry passengers only at half load for the purpose of physical distancing, then the revenue derived from such service by tour bus operators will be very minimal. Apart from normal operating costs, they have to pay for regular cleaning and disinfection.

Unless tour bus operators, which all were granted licences for inbound and domestic tours, can create new tours with daily departures and not rely on charters, most of them will be doomed. But for those who can, it will not be difficult for leasing companies to grant them the moratoriums they seek.

Lessors cannot be faulted to pick and choose to rescue only the most deserving tour bus operators, but it is customary for associations to seek help for all their members. Just like any other business, only the strongest and fittest will survive, or those most adaptable to change in the current scenario.

While many hotels have chosen to cut further losses by closing down and airlines switching to carrying cargo when passengers are too few and far in between, local tour bus operators and associations are going through the motions adopted by taxi drivers and associations in the past when they called for individual permits and banning of e-hailing service.

But without being able to offer convincing reasons, all their protests and rhetoric have come to naught.

The views expressed here are those of the author/contributor and do not necessarily represent the views of Malaysiakini.