LRT-1 losses spur MPIC exit review
‘We are still losing on LRT-1 in part because of Covid-19 (pandemic). Ridership went down obviously and it has not fully recovered.’
Manuel V. Pangilinan-chaired Metro Pacific Investments Corporation owns a 35.8 percent stake in Light Rail Manila Corp., which operates and maintains LRT-1 under a public-private partnership agreement with the government.
PHOTOgraph courtesy of LTO Portal Ph
Metro Pacific Investments Corp. (MPIC) is considering divesting its stake in Light Rail Manila Corp. (LRMC), the operator of the Light Rail Transit Line 1 (LRT-1), as the transport venture continues to incur losses amid a slow ridership recovery.
In a chance interview on Tuesday, MPIC chairman Manuel V. Pangilinan said the lingering impact of the pandemic continues to weigh on the business.
“We are still losing on LRT-1 in part because of Covid-19 (pandemic). Ridership went down obviously and it has not fully recovered. We continue to lose money from LRT-1 and I think we are considering selling it, getting out of the light rail,” Pangilinan told reporters.
Prospective buyers
When asked if MPIC has started discussions with prospective buyers, he said talks remain preliminary.
“Not yet, we are just talking about it yesterday and people are complaining that we are losing money so why do we need this.”
MPIC owns a 35.8 percent stake in LRMC, which operates and maintains LRT-1 under a public-private partnership agreement with the government.
Reluctance to invest in new rail projects
The possible exit comes as MPIC also signals reluctance to take on new rail projects. Pangilinan previously said the company is unlikely to resubmit a proposal to operate and maintain the Metro Rail Transit Line 3 (MRT-3), citing the absence of approved fare adjustments as a key obstacle.
Meanwhile, the Department of Transportation (DoTr) has yet to finalize bid terms for a new MRT-3 operator, with the current contract for the Sobrepeña-led Metro Rail Transit Corp. expiring this year. The government continues to subsidize MRT-3 operations to keep fares low.
In a separate development, LRMC reportedly offered to the DoTr in September to complete the long-delayed Unified Grand Central Station, or Common Station, in North Edsa, Quezon City.
The project, initially targeted for completion in 2020, has faced repeated setbacks, including pandemic-related disruptions, and is envisioned to link Metro Manila’s major rail lines into one integrated intermodal transport hub.