Hong Kong exports its super-efficient subway

The efficiency of Hong Kong's subway system could be coming to your city.
Written by Tyler Falk, Contributor

A subway system that can move 5.1 million people every weekday with an on-time performance of 99.9 percent certainly deserves to call itself "one of the world's leading railways."

But Hong Kong's Mass Transit Railway (MTR) is doing something odd for an urban rapid transit system -- even more odd than being on time. It's exporting its brand as one of the world's best metros and super-efficient services to cities around the world.

As the Wall Street Journal reports, MTR already runs rail lines in mainland China, Australia, and Europe and exports its trademarked door chimes. And now it's looking to build on that growth with rail projects from Germany to Sydney to London's Crosscut commuter rail project. It's rare to see a city expand its mass transportation system to other cities around the world, but then again, MTR isn't your typical urban transit system.

The company is publicly traded and consistently profitable without any direct government support. Those earnings come from another unique characteristic: MTR profits from developing the land above and around its stations, allowing it to benefit from Hong Kong's booming real-estate market. That land comes from the Hong Kong government, amounting to an indirect subsidy.

The rail operator is 77%-controlled by the government, meaning it is ultimately owned by Beijing, though Hong Kong retains its own government and legal system. MTR made an underlying profit of 4.25 billion Hong Kong dollars (US$548 million) in the first half of 2013, up 5.1% from a year earlier. Just 10% of the profit came from overseas.

While MTR isn't able to reach Hong Kong's impressive on-time performance of 99.9 percent in other cities, its ability to improve existing lines is quite remarkable. According to WSJ, the London Overground, run by MTR, had an on-time performance of 96.7 percent over the last 12 months compared to 88.4 percent in 2007, before MTR took over. The same happened with the Melbourne Metro which increased on-time performance from 84.6 percent in 2009 to 93.7 percent last August.

With a track record like that, don't be surprised to see MTR win more bids in more cities to run rail services.

Read more: Wall Street Journal

Photo: Flickr/Leung Ching Yau Alex

This post was originally published on Smartplanet.com

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