Cheap, Efficient and Profitable : Privately Owned ‘Colectivo’ Buses Thrive in Buenos Aires

The 102 is a hulking red, black and blue brute of fearsome appearance and great urban utility. In rush hour, it slices across clogged Libertador Avenue with the imperious elan of a lion arriving for lunch.

To outsiders the 102 may look like a bus. But Argentines know that it is something much more: It is a colectivo.

Colectivos, brightly painted and seemingly everywhere, offer cheap and efficient transportation. They are privately owned and, at a time of staggering inflation, they make a profit.

“There is no state participation and no subsidy of any sort,” Jose Carlos Piva, president of the National Assn. of Colectivo Lines, boasted recently. “Moreover, directly or indirectly, about 30% of every peso we take in goes to the government in taxes.”

City governments used to run their own red-ink bus lines in Argentina, but they have all surrendered to the colectivo.

Carlos Pasquinelli, who is the coordinator of colectivos in Buenos Aires for the National Transport Secretariat, said: “It would be hard to find another country where the system works as well for the public and for the owners. Most of our regulation is fine-tuning something that is already quite efficient.”

11,000 Colectivos

Buenos Aires has 11,000 colectivos, supplemented by a fleet of 30,000 black-and-yellow taxis, nearly all of them owned by their drivers. The taxis also make money. By contrast, the state-run railroads and the Buenos Aires municipal subway lose money.

The economic success of the privately run bus system is astonishing in the context of Argentina’s recent economic history. Since World War II, Argentina has endured a cycle of inept authoritarianism and inept democracy, both characterized by stagnation and inflation. The government is heavily engaged in the economy but its enterprises all lose money, from the oil and telephone companies to the national airline.

Through the years, the colectivo has been one of the few national verities. If you stand on the corner of Rivadavia and Esmeralda streets, a No. 45--red over green with a black stripe--will lumber past every two minutes or so, no matter what the stock market is doing or the politicians are saying.

In Buenos Aires, home to nearly a third of Argentina’s 30 million people, there are more than 300 companies running colectivos, each with its own route and its own colors. Last year, they carried 2.5 billion passengers and provided 52% of all urban transportation. Private cars, by contrast, accounted for about a third as many urban passengers.

The base colectivo fare, currently about a dime, is set with care by the national government. Fares too high would outrage the riders; fares too low would drive colectivos off the streets. Argentina has survived meatless days, and it could probably survive tangoless days, if it should come to that. But without colectivos, Argentina would stop.

Even in 1928, when the colectivo was invented by immigrant Spanish and Italian taxi drivers, Buenos Aires was a city made to order for mass transportation. The city is vertical rather than horizontal, compact and densely populated.

The colectivo, which costs about $40,000 these days, is a diesel-powered, seven-ton hybrid: a locally made body bolted to a Mercedes Benz truck chassis. It seats 21 and has standing room for as many people as the driver--and the other passengers--will tolerate.

The drivers earn about $250 a month, which is a relatively good income here. Exact fare, even in a country without coins, is not required. The drivers somehow find change from a stack of dirty bills, and they do it with one hand, while shifting gears and steering along narrow streets with the other.

“Population density and lesser access to private cars than, for example, in the United States, stimulated the demand for buses,” Pasquinelli said. “The colectivo was a creative, solid response to it. As a result, we are spoiled. People are outraged if they have to walk more than a couple of hundred meters to a bus stop.”

Indeed, Argentines who visit the United States are apt to complain that American buses are expensive and infrequent--and dull. Colectivos have had distinctive color schemes from the first, brought from the old country or perhaps borrowed from a favorite soccer team.

Easy Identification

The colectivos’ colors make for easy identification and add zest to the street scene. Even from the back or the side, at night or in the rain, it is hard to confuse the yellow-over-blue of No. 29 with the black-over-turquoise of No. 17.

Colectivo owners, many of them up from the drivers’ ranks, say their success in meeting urban demand is not hard to explain.

“We are good managers,” the association’s Piva said. “That is the only secret. People who run the lines are close to their operations. They are agile, and they are decisive. If there is a special event, they quickly put on more buses. If a street is blocked, a driver doesn’t wait for instructions; he finds a way around. If a headlight burns out, nobody calls a committee meeting to talk about it. We change the headlight.”

From headquarters in the southern, blue-collar district of Avellanada, a firm called Expreso Quilmes runs the yellow-red-and-black colectivos No. 98 and No. 116. Juan Carlos Arias, a former driver who is the firm’s president, told a reporter:

“We carry 2.6 million passengers a month on 220 buses. On any given day, about 95% of the fleet is on the street. Two-thirds of our employees are drivers. Overall, we have about three workers per vehicle. When the government ran the buses, I think they had around seven workers per vehicle.”

According to a hand-lettered chart pinned to a wall in Arias’ office, in 1983-84, a bad year for Argentina economically, Expreso Quilmes paid its shareholders a dividend of 5.7% of gross revenue. In 1982-83, the dividend was 11%. In a good year, Expreso Quilmes renews a fifth of its fleet; in hard times, as at present, a tenth.

Professionally Managed

A few old-school cooperatives of owner-drivers survive, but most of Buenos Aires’ colectivo lines are professionally managed corporations.

No new colectivo lines have been started in the city since 1958, according to Piva. And Pasquinelli says 55 lines have gone broke in the past 20 years. With a current average of 110 colectivos per company, Piva says the tendency is toward consolidation.

Expreso Quilmes is a case in point. It does all its own repairs and body work, manufactures its own batteries and recaps its own tires, Arias said. In collaboration with other lines, it owns an insurance company and a factory where colectivo bodies are made.

The streets of Buenos Aires are among the world’s most crime-free, and this may be attributed in part to the fact that colectivos and taxis leave few streets deserted enough to encourage muggers. At the same time, though, the colectivos contribute to a motor vehicle accident rate that is one of the world’s highest on a per-capita basis.

Not all Argentines are enthusiastic about the colectivo. The addition of a colectivo line to a neighborhood can improve property values, but the appearance of a noisy, smelly colectivo on a previously quiet street can make it unlivable.

Jorge Luis Borges, the octogenarian dean of Argentine letters, complained in a recent interview about “those stinking colectivos.”

“We were better off with horses and carriages,” he said.

As Borges attests, colectivo mufflers are often not what they might be. Neither, judging by the clouds of black exhaust, are their engines always properly tuned. There are strict noise and pollution controls in Argentina, but they are enforced only sporadically in most cities.

Still, there can be few urban transport systems elsewhere that match Argentina’s colectivos--for efficiency or flair. As street theater, watching the peremptory passage of a 102 across Libertador Avenue is unsurpassed--unless you are one of the quaking lesser folk fleeing its jaws.