All aboard?
by This email address is being protected from spam bots, you need Javascript enabled to view it on Saturday, 27 June 2009
"They [the RTA] know the metro, as a large infrastructure investment, is not going to be something they will make a huge profit with," Ziegler says. "This is not a profit-generating enterprise and I think someone from the RTA said that a couple months ago at a conference. He said this was an investment in the infrastructure of Dubai, therefore there is no short-term business case.
"There is a long-term business case in trying to get traffic into public transport and making Dubai a more liveable place."
Suggestions that the metro could affect Dubai's car rental companies are also misplaced, according to Ziegler. He argues that holidaymakers or businesspeople staying in the emirate are still likely to find hiring a vehicle much more convenient than riding the metro.
"You could be a tourist or someone on business here for a while and want to get to places that are not so easily accessible," he says.
Sam Eltibi from car rental company Dollar Thrifty makes a similar point, claiming residents will still require car transport when the metro goes live on September 9. The executive director for the MENA and Asia Pacific region said: "People want to go to distant destinations where the metro won't take them. The metro is a good addition to the transportation mix, but it is not going to touch our business in any way.
"A few years ago, I was asked a question about Salik [road tolls] and I said the same thing then - it will have zero effect."
If anything, analysts such as Ziegler and Gautam Bellur, an associate partner in Oliver Wyman's Dubai-based transportation practice, are confident the metro will mean more business for local companies.
Bellur says: "The metro is developed with anticipated demand in mind. It is not a toy for Dubai. It is built with the idea of encouraging mass transit for a fast-growing city, so it is not just a good thing, it's absolutely required for a growing city. It is paramount to have a well-oiled metro system."
When fully operational, the metro should help cut road traffic, making the city more attractive to outside investors, according to Bellur.
"Each transportation mode has a role to play in the overall transport system," he adds. "The RTA would never have conceived of a major development like this if traffic wasn't one of the key areas that they were trying to impact. Particularly in areas that face significant traffic in peak hours, the metro will likely be a huge hit."
As for the people using the metro, Bellur insists it is too early to assess which portion of Dubai's population will provide the most passengers. He does, however, argue that people's reliance on the metro will depend on where they live.
"I would imagine the RTA has researched the demographics and what is right for 20 to 40-year-olds is not necessarily the same for people who are 40-plus," Bellur says. "There is also income and where people live to consider.
"If you live in Dubai Marina you are more or less a suburbanite who may think differently to someone in Bur Dubai or Deira for whom [the metro] is almost a critical lifeline, so as not to get clogged in traffic on a daily basis.
"Demand is going to be highest in those places where people have fewer alternatives. It may take a longer time for people or communities [to show interest] where there are alternatives."
READERS' COMMENTS
MORE FROM ARABIANBUSINESS.COM
TOP IN MIDDLE EAST TRANSPORTATION
TOP MIDDLE EAST BUSINESS STORIES
ALSO IN MIDDLE EAST TRANSPORTATION
SHARE PRICE CHECK
RELATED STORIES
Roads & Transport Authority (RTA)
- Fewer drivers killed on Dubai roads last year
23 Nov '09 | News - Nearly 400 Dubai Metro passengers fined so far
17 Nov '09 | News - Construction work completed on Red Line stations
15 Nov '09 | News




