1. MINISTERIO DE TRANSPORTES
GOBIERNO DE CHILE
MINISTERIO DE TRANSPORTES
Y TELECOMUNICACIONES
Business Model of Transantiago
Road Show January/February 2004
Gibrán Harcha S.

2. Index
Introduction.
Public Transport System.
Integration Infrastructure.
Support Services.
Business model.

3. Upgrading our Public Transport System
Transantiago, the Urban Transport Plan, answers to the people living in the Metropolitan Region who require better service, more safety on the streets and cleaner air.
Our priority is to modernize the public transportation system. Transantiago has already begun with the expansion of the subway system and Multivía as means of payment on metro and Metrobus.
Transantiago is the city’s leading urban renovation project and part of the nation’s Bicentennial celebration plan. Its goal is to turn Santiago into a world class city.

4. Inter - Ministerial Committee
GOBIERNO DE CHILE
MINISTRY OF TRANSPORT
& TELECOMMUNICATIONS
MINISTRY OF HOUSING &
URBAN DEVELOPMENT
MINISTRY OF FINANCE
MINISTRY OF PUBLIC WORKS
METROPOLITAN GOVERNMENT
ENVIRONMENT NATIONAL COMISSION
SECRETARIAT OF TRANSPORT INVESTMENT
PLANNING
GENERAL COORDINATION OF CONCESSIONS

5. Index
Introduction.
Public Transport System.
Integration Infrastructure.
Support Services.
Business model.

6. Public Transport System Integration
Local-Feeder Services Network (10 B.U.)
(short distance trips)
Trunk Services Network (5 B.U.)
(middle and long distance trips)
10 Geographical Areas for local services
Actual Subway Network
3 Lines; 25 Miles
Subway Network Extensions
Line 2 North Extension
Line 2 South Extension
Line 5 West Extension
New Line 4
Future: More than 50 Miles

7. Fare Collection System
Local Fare: For trips that use only the local-feeder services in the business area.
Trunk Fare: For trips that use only the trunk services.
Integrated Fare: a) For trips that use one feeder service and any combination of trunk services.
b) For trips that use a feeder service, any combination of trunk services and another feeder service.
Student Fare: For trips made in any combination of trunk and local-feeder services. The Student Fare could be restricted depending on time-of-day and quantity of trips.

8. Index
Introduction.
Public Transport System.
Integration Infrastructure.
Support Services.
Business model.

9. Blanco Encalada - Arica
Integration Infrastructure: Strategic Connection Points
Blanco Encalada-Arica
Suiza-Departamental
Connection
Investment
(MMUS$)
Blanco Encalada - Arica
17.4
Suiza - Departamental
16.5
Total
33.9

10. Integration Infrastructure: bus lanes
Alameda
Avenue
Length
(miles)
Investment
(MMUS$)
Alameda
4.7
1.5
Pajaritos
3.7
10.5
Sta. Rosa
6.9
35.9
Total
20.3
47.9
San Francisco
Pajaritos
Sta. Rosa

11. Integration Infrastructure : Bus Stops
HIGH-DENSITY STATIONS
Station
Quantity
Investment
(MMUS$)
> 10,000 4
15.0
8,000 – 10,000 2
4.8
6,000 – 8,000 6
9.9
4,000 – 6,000 11
14.5
2,000 – 4,000 36
26.8
1,000 – 2.000 53
23.3
Total
112
94.4
NEW BUS STOPS
Bus Stops
Quantity
Investment
(MMUS$)
Trunk Network
1,000
6.4
Feeder Network
4,100
26.4
Total
5,100
32.8
Local advertising under negotiation.

12. City and intercity buses
Integration Infrastructure : Modal Interchange Stations
Competitive bidding process for Group 1: Quinta Normal and La Cisterna.
Cars
Integrated to the urban environment
Service centers that attract travelers
Taxis
City and intercity buses
Quinta Normal
Subway
iderations
Pedestrians

13. Index
Introduction.
Public Transport System.
Integration Infrastructure.
Support Services.
Business model.

14. TransantiagoSupervision Information Screen on buses
Support Services : Management & Information Center (CIG)
Public Transport Management Center
User System Information
TransantiagoSupervision
Waiting time display at bus stops
Remote Information Access
Fleet
Management (Operator)
Line Information by phone
Next Stop: U. de Chile
Next Stop: Sta Lucía
Information Screen on buses

15. Transantiago Financial Administrator
Support Services:
Transantiago Financial Administrator
Bank:
Funds Administrator
Card (Multivía):
Supply, Recharge System
& Distribution Network
Fare Collection
Homologation
Trip Subsystem Transport Operators
Clearing
Transaction
Switch
Provisión del medio de acceso
Provisión de la red de carga
Recaudación
Administración de los recursos
Ejecución de los pagos a los servicios de transporte y apoyo
Provisión de Créditos

16. Funds Administrator Bank
Support Services: Transantiago Financial Administrator (AFT)
Funds Administrator Bank
System Accounts:
C1 : Technical Reserve
C2 : System
C2.1: AFT
C3 : Operators
C3.i: Per operator
C4 : Fines and Bonuses
Initial Technical Reserve provided by the AFT for UF , (US$ 35 million) plus a provision included in the fare until a total of UF is reached.*
Funds Administrator
Bank
Provision of Credit Lines for up to:
Short Term :
UF (US$ 53 million)
Long Term :
UF months
Execution of Payments
Administración de los Recursos del Sistema:
El AFT deberá encargarse de administrar los distintos recursos financieros asociados al sistema del transporte a licitar, para lo cual deberá disponer, entre otras, de las cuentas siguientes:
C1 : Reserva Técnica
C2 : Del Sistema
C21: AFT
C3 : Operadores
C4 : De Multas y Bonificaciones
(*) Exchange Rate:
UF 1 = CH$
US$ 1 = CH$ 575
UF: Unidad de Fomento. Indicator money indexed to internal inflation rate.
State Guarantee for up to: UF

17. Index
Introduction.
Public Transport System.
Integration Infrastructure.
Support Services.
Business model.

18. = Financial Operation of the System
Systems resources originated from fare collection
The system operates with an initial Technical Reserve provided by the AFT for UF (US$ 35 million)
System Fare
Payments of Transport System
Payments of Support Services
Infrastructure Payments
Provision for technical reserve = + + +
Part for contingency fund that is included in fare in order to avoid fare adjustments during times of deficit and surplus

19. Fare Readjustment Incomes > Costs → Fare reduction
Variable Demand
Customers
Trips
Fares
System
incomes
AFT
SERVICES
System
operation
Payment
System
Costs
Readjusted due to
variations of
costs (oil, etc.)
Incomes > Costs → Fare reduction
Incomes = Costs → Fare is kept
Incomes < Costs → Fare increase

20. CARD SUPPLY AND DISTRIBUTION
Revenue Flow Composition
Transactional
Switch
C3: System Funds
Validation of
Electronic
Transaction
Electronic
Recharge
POS
Fund Administration
Bank
Electronic
Fare
Revenues
CARD SUPPLY AND DISTRIBUTION
Cash
Emisión del Medio de Acceso Único al Sistema de Transporte: Consiste en la provisión y habilitación de tarjetas sin contacto que permitan a los usuarios la carga de dinero que será utilizado posteriormente para el pago de los servicios de transporte.
Comercialización/Distribución del Medio de Acceso: Consiste en la generación de una red de distribución que permita el acceso a los usuarios a la adquisición del medio de acceso.
Red de Carga: Habilitación de una red de puntos que permita a los usuarios la carga y recarga del medio de acceso. En estos puntos se realiza la función de recaudación del sistema, recibiendo el dinero de los usuarios.
Physical
Revenue
Start up
charge
Sales
Revenue
RECHARGE NETWORK

21. Back up Information for AFT Validation (Mirror)
Operator Payments Scheme
Back up Information for AFT Validation (Mirror)
Operators
and
Suppliers
CIG
Per Business Unit:
Temporal Position
Validated trips
Accounted Passengers
Per Business Unit:
Kilometers provided (TBU)
Evasion Factor (TBU)
Validated Trips (TBU,TFU)
Payment Execution
C3.i : Operators
Clearing
Fines and Bonuses
per Business Unit
Funds Administrator
Bank
Liquidación
Payment Validation
C1 : Technical Reserve

22. Clearing Payment Procedure Fund Administrator Bank C2: System
C1 : Technical Reserve
Clearing
Fund
Administrator
Bank
Payment Validation
C3: Operators Accounts
C4 : From fines and bonuses

23. Validated Trips per Business Unit
Incentive Mechanism : Fines and Bonuses
OPERATORS
Users
CIG
Passengers Accounted for
Real Itineraries
Amount of Kilometers provided
Validated Trips per Business Unit
Fines and Payment Adjustment per levels of Fraud
Inspection generates fines for all
System Fraud Factor applicable only to trunk business units (5%)
Incentives
Mechanism
Bonuses
Indicators of user satisfaction (Various Users)
Service quality indexes (Direct Inspection)
Operational Compliance Index (Overseeing by CIG)

24. Services Means of Payment
Services and Payment
Services
Means of Payment
Trunks
Bus – kilometer
Feeders
Transported passenger
Transfer Station
Entered bus
Management & Information Center
% of system income
Metro
Wagon – kilometer
Infrastructure
Annual fixed payment
Financial System Administration
% of system income and fixed payment

25. Technological & Financial Management of US$700 Million yearly
Business Opportunities to Bid
Identification
Class
Invest
Term
Local-Feeder (1-9)
Transport Services
From 6 to 16 US$ Million
5 years
Local-Feeder 10
US$ 3 Million
16 years
Trunk Units 2 & 4
Around US$ 100 Million
10 to 16 years
Trunk Units 1, 3 & 5
Around US$ 30 Million
3 to 16 years
System Financial Administration (AFT)
Technological & Financial
Management of US$700 Million yearly
12 years
Management & Information Center (CIG)
Technological
Around US$3 Million
Modal Interchange Stations
DBOT
Around US$ 25 each
25 years
Infrastructure
BOT
Around US$ 70 Million
Long Term

26. Additional Business Opportunities
Local advertising on buses, stations, bus stops, etc.
Associated Commercial Services
Transport Fund financial operations
Others
The valuation of additional income, the competition process and the flexible implementation of the program can reduce income requirements and generate fare reductions.

27. MINISTERIO DE TRANSPORTES
GOBIERNO DE CHILE
MINISTERIO DE TRANSPORTES
Y TELECOMUNICACIONES
Business Model of Transantiago
Road Show January/February 2004
Gibrán Harcha S.