Scrap firms to buy old jeepneys for P20k-P30k, says DOTr exec

The government eyes the removal from the country's roads of 170,000 jeepneys by the year 2020, an official of the Department of Transportation said on Wednesday.

In Malacañang, Assistant Secretary Mark De Leon said old jeepneys—those 15 years and older—will be bought by state-accredited scrap firms for P20,000 to P30,000.

Under the Public Utility Vehicle Modernization Program, old jeepneys will be replaced by environment friendly and fuel-efficient units, those with an exit door on the right side of the vehicle and a bigger body to accommodate more passengers.

The program is targeted to go in full swing by 2020 with the government extending P80,000 as subsidy to help operators and drivers fund their purchase of new units, priced between P1.6 million and P1.8 million.

“Binigyan kayo ng P80,000 ng gobyerno, subsidy, tapos papatakbuhin mo pa rin 'yung lumang unit? Binigyan ka na nga ng bagong unit ng gobyerno, [and yet] you’re running the old unit. Kailangan talaga natin tanggalin sa kalsada," De Leon told reporters in Malacañang.

De Leon added jeepney operators and drivers can form cooperatives to ensure financial viability of the operations after some transport groups said the modernization program will just bury them in debt.

"Kapag kayo ay isang registered cooperative mas madali kayong makakuha ng financing. Iyong bangko nababaan iyong risk noong bangko na magpautang sa inyo. Kasi iyong risk na hindi kayo makabayad ulit since individual kayo bumaba," he said.

"It [also] reduces competition. Iyong competition na iyon na sinasabi natin, that boils down to inefficiency. Nagkakarerahan sa kalsada, hindi ka assured, iyong operator na kikita ka. Pero kung cooperative na, at the end of the day iyong kita ng buong cooperative mapagpaparte-partehan ninyong mga drivers, mapagpapartehan ng mga operators."

The DOTr official also said the jeepney business should not be viewed as a means of livelihood alone. 

"Hihirit natin livelihood and you’re not financially capable, how can you ensure na mayroon kang pera for the maintenance of your units? How can you ensure na may pera ka for the payment of insurance of the vehicles? How can you even ensure na mayroon kang pera for garahe?" he said.

"Kaya nangyayari iyong mga jeepneys natin naka-park na lang sa mga gilid-gilid ng mga kalsada, walang garahe eh. Kasi nga tiningnan ‘to as a means of livelihood."