Subway Fare Soars--to 3 Cents : Mexico Raises Price by 2,000% to Help Cut Deficit

In a gesture aimed at putting the country’s finances in order, the government of Mexico raised the fare for a ride on Mexico City’s extensive subway system by 2000% Friday.

The fare had been held to a single peso since the first of seven subway lines opened 17 years ago. Then, on Friday, the price of a ticket was hiked to 20 pesos.

Despite the apparent sharpness of the increase, it is still cheaper to ride the Mexico City subway than it was in 1969. Then, a peso was worth eight U.S. cents on foreign exchange markets. Today, 20 pesos are valued at about three cents. Since 1969, prices in Mexico have increased about 80-fold, far outstripping the 20-fold increase in the subway fare.

In addition, special, multiple-ride coupons reduce the cost for frequent passengers.

The fare increase, however, tarnishes a dearly held symbol of government commitment to social welfare. The subway is the domain of Mexico’s working class, which the government, through subsidies on everything from tortillas to transport, has tried to shield from the nation’s economic straits. Many of those subsidies are falling away in the face of a deep recession.

More Increases Expected

“This breaks the ice,” said economist Rogelio Ramirez de la O. “There will likely be more increases.”

In all, consumer prices in Mexico are expected to rise 100% in 1986.

The subway system, which ties sprawling Mexico City together with 74 miles of track, opened without incident Friday, with most passengers taking the increase in stride.

“Everything else has gone up in price. Why not this?” asked Leticia Gomez, a maid changing trains at the Tacuba station.

The shock of the increase was softened by a relatively long lead time in making the change. The government floated proposals to raise the fare frequently during the past year. In June, it finally set a date for the increase.

Many riders took the June announcement as a cue to stock up on tickets at a peso apiece. The rush to buy tickets prompted the authorities to limit purchases, first to 10 tickets at a time and then to five. Finally, two days before the fare change took effect, no more than two tickets could be purchased by one person at any one window.

Old Tickets Still Work

On Friday, however, there was some confusion about whether the old tickets, which are colored pink, could still be used. The new 20-peso tickets are yellow. Both old and new tickets are magnetized to activate turnstiles that allow passengers to reach the platforms, and both still work.

Police at the busy Insurgentes station forbade passengers to use the pink tickets. Nonetheless, an occasional youth slipped by and entered the platform by inserting the cheaper ticket into electronic slots.

“I have 40 of these tickets saved up,” said Rodrigo Baltazar, clutching a stack of pink tickets. “Do you think they’ll take trade-ins?”

As recently as two years ago, Mexico City authorities pledged that subway fares would remain at one peso to benefit the poor. But the recent sharp decline in oil prices, a main source of government revenue, combined with conditions placed on loans from abroad, is forcing the government to rein in its spending.

IMF Requirements

Last month, Mexico signed an agreement with the International Monetary Fund that is expected to open the way for billions of dollars in loans from foreign banks and government lending agencies.

As part of the agreement, Mexico promised to reduce subsidies on many goods and services and to sell or close unprofitable government-owned businesses.

Such moves are politically sensitive here, and the government has moved cautiously to implement the money-saving measures.

For instance, the recent closure of a major steel mill in Monterrey was accompanied by larger than normal severance allowances for 8,000 laid-off workers.

Increases in the price of tortillas--which the government had kept low by absorbing part of the cost of producing them--were announced in conjunction with the issuing of food coupons. The coupons allow the poor to continue buying tortillas at a low price.

Bus Fares Also Rise

The fare increase on the subway went into effect along with sales of 15-day transportation coupons that cost 700 pesos ($1.08) apiece. The coupons may be used on buses as well as the subway. Bus fares were raised Friday from three pesos to 20 pesos.

Given the fare-saving coupons, it is difficult to say how much money the government will gain with the increase. It has been estimated that for the subway system to break even, the cost of a subway ticket should be about 60 pesos. The 1986 budget for the subway system is about $90 million, and about two-thirds of that is funded by the federal government, the rest by ticket sales and city funds.

The Mexico City subway is officially known as the Collective Transport System, but everyone calls it the Metro. Built with French engineering help and now using French, Canadian and Mexican-built cars, it carries about 4 million passengers a day. By comparison, traffic on the New York subway is 3.4 million.

The bright orange trains whoosh along rapidly and quietly on rubber wheels. Most rider complaints center on inoperable air conditioners and occasional short circuits that cause delays. The 109 stations are virtually free of litter and graffiti, and crime is rare. About 2,000 police officers patrol the stations to keep the peace.

Occasional Accidents

Accidents occur occasionally, the most recent on Thursday night when four tires blew on a train running beneath the downtown area. A fire started and one person died of smoke inhalation. Thirty other passengers were hospitalized. The accident raised questions about whether the trains are being well-maintained.

In general, crowds on the Metro are orderly, even at rush hour, except for a habit of boarding the trains before exiting passengers can get off. Officials resolved a problem involving unwelcome fondlers by making separate cars available to women and children during peak traveling hours.

A treat along the lines are the preserved pre-Hispanic ruins uncovered during excavation for the system. In some cases, altars and ancient artifacts have been left in place at stations for viewing by travelers.