WMA TRANSIT COMPANY

WMA TRANSIT COMPANY IS A SMALL, PRIVATELY-OWNED BUS LINE SERVING THE EASTERN HALF OF THE WASHINGTON METROPOLITAN AREA WITH ROUTES FANNING OUT FROM DOWNTOWN TO GREENBELT AND BOWIE, MARYLAND, ON THE NORTH, AND OXON HILL AND ANDREWS AIR FORCE BASE ON THE SOUTH. TRANSIT HAS SOME UNIQUE OPERATIONAL PROBLEMS. THE AVERAGE PASSENGER'S RIDE DURING THE PEAK PERIODS IS CONSIDERABLY LONGER THAN ON D.C. TRANSIT (DCT). THEY HAVE A PASSENGER TURNOVER PER RUN OF ONLY SLIGHTLY BETTER THAN ONE, COMPARED TO DCT'S FOUR TIMES PER RUN. WMA'S PASSENGERS RIDE LONGER DISTANCES AND PAY HIGHER FARES (DUE TO THE ZONED FARE STRUCTURE), BUT DCT RECEIVES MUCH MORE REVENUE PER RUN BECAUSE OF THEIR HIGHER TURNOVER. AN EXAMINATION OF THE MOST RECENT FINANCIAL STATEMENTS REVEALS THE SYSTEM'S TENUOUS FINANCIAL POSITION. THE MOST STRIKING PARTS OF THESE STATEMENTS ARE THE NET LOSSES OF THE LAST TWO YEARS AND THE NEGATIVE EARNED SURPLUS (RETAINED EARNINGS) FOR THE YEAR ENDED DECEMBER 31, 1969. IN 1968, DEBT FINANCING EXCEEDED EQUITY FINANCING BY NINE TIMES -- A HIGH MULTIPLE. FOR 1969, THE RELATIVE VALUE SKYROCKETED TO THIRTY TIMES. THE HUGE INCREASE IN DEBT FINANCING IN THE LAST FEW YEARS WAS DUE PRIMARILY TO WMA'S PURCHASE OF FORTY NEW BUSES DURING THIS PERIOD. THE HUGE DEBT OBLIGATIONS INCURRED BECAUSE OF THE EQUIPMENT PURCHASED RAISED BOTH THE DEBT FINANCING AND INTEREST EXPENSE, AS WELL AS DEPRECIATION CHARGES. UNFORTUNATELY REVENUE DID NOT INCREASE AS SWIFTLY AND EXTENSIVELY AS MANAGEMENT MAY HAVE ANTICIPATED. THE DEVELOPMENT OF A VIABLE MARKETING PROGRAM EMPHASIZING THE AREAS OF MARKET RESEARCH, PRODUCT PLANNING, PRICING, AND PROCOTION IS RECOMMENDED. EFFORT MUST BE MADE TO DESIGN ATTRACTIVE TRANSIT PACKAGES TAILORED TO THE NEEDS, ASPIRATIONS, AND PERCEPTIONS OF THE VARIOUS MARKET SEGMENTS SO THAT LOST PATRONAGE CAN BE REGAINED AND PRESENT RIDERSHIP RETAINED. /UMTA/

  • Supplemental Notes:
    • PROJ NO URT-11
  • Corporate Authors:

    Consortium of Universities

    Urban Transportation Center, 1717 Massachusetts Avenue, NW
    Washington, DC  United States  20036
  • Authors:
    • Aten, B W
    • Bulmash, G F
  • Publication Date: 1970

Subject/Index Terms

Filing Info

  • Accession Number: 00241962
  • Record Type: Publication
  • Source Agency: Urban Mass Transportation Administration
  • Files: TRIS, USDOT
  • Created Date: Nov 7 1972 12:00AM