By Isaac Salima:
Malawi Posts Corporation (MPC) has suspended its passenger bus services across the country.
This is the second time the government-owned firm has halted its bus operations, having also done so last year.
In a written response, Minister of Information Moses Kunkuyu said the buses now present more challenges than benefits.
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“Post buses have been in operation for approximately five years. However, it has become evident that the buses have now aged and, at this stage, they present more challenges than benefits.
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“The high maintenance and operating costs associated with the aged fleet have become unsustainable, leading the corporation to rely on revenue from other business units to sustain the passenger service operations.
“As a result, the post bus business unit has become unprofitable due to these escalating maintenance and operating costs,” Kunkuyu said.
He added that MPC is working to strengthen its courier service in order to maximise revenues.
The minister said recently, the corporation procured four additional trucks to improve its capacity for moving consignments across the country.
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“Furthermore, service delivery and customer experience are being improved through the digitalisation of all processes, which is expected to positively impact revenue generation,” he said.
Economics expert Marvin Banda said government-owned firms must have clear strategies if they are to achieve their set goals.
“Publicly owned companies usually have fundamentals placed within the business operating environment that are sometimes social in nature. This sometimes hampers the ability of companies to make sustainable profits. This is not the case with private entities, which are profit-driven.
“When operating in their business environment, they focus on cost minimisation and revenue generation. So, when public companies are implementing turnaround strategies, they sometimes lack the required expertise to achieve desired goals,” Banda said.
In 2019, MPC embarked on a passenger bus business after obtaining a K700 million bank loan.
But the business has failed to meet its desired goals.
MPC also suspended its bus services last year, although the buses were seen operating despite the halt.
Some five years ago, MPC announced a turnaround strategy, but it has yet to bear the desired fruits as the parastatal continues to sail through troubled waters.
The firm has been retrenching staff as part of the implementation of the turnaround strategy.
