Sun | Jul 22, 2018

Letter of the day | A suggestion for highway operators

Published:Friday | September 9, 2016 | 12:00 AM


I would like to make a suggestion to the operators of the North-South Highway regarding their recent application for a rate increase for use of various legs of the highway.

In my opinion, their approach is totally wrong and is not in keeping with well-known and proven principles of business.

When times are slow, a business does not seek to increase prices. Rather, it either reduces its prices, or, in some cases has a sale (or a special offer) for a limited time to increase cash flow. The highway operators would do well to utilise this kind of approach rather than seeking a rate (price) increase, which would only serve to further reduce the traffic utilising the highway and thereby reduce total income even further.

On the occasions that I have travelled on this highway (and what a beautiful stretch of road it is), and in all the pictures that I have seen, it appears that the traffic utilising the roadway is well below 20 per cent of capacity. Or, perhaps closer to 10 per cent of its capacity, although I have no figures to prove either figure.

An indisputable fact is that the highway could carry far more traffic than it currently does, and I suggest that the way to achieve this is to reduce rates by 20-25 per cent from what prevails at present, rather than increasing them.

The scope is there for a 300 per cent increase or more in the number of vehicles using the highway, so the potential is there for a hefty increase in income, provided that the rates are affordable. Volume and economical rates are the way to go.

In my view, the sparse use of the North-South Highway is due to the fact that many motorists, particularly those operating commercial vehicles, just cannot afford the present rates. If another increase is requested, volume will decrease even further and the cycle will continue - higher and higher rates, fewer and fewer customers.

Are the highway operators prepared to think outside of the box and try a completely different approach? I hope so.

Philip A. Azar