Is Budapest transport in trouble? Suppliers are leaving
The war between Russia and Ukraine also has an impact on this area. Parts for Budapest’s metro line M3 still have not arrived from Russia. One by one, suppliers of the Budapest Transport Company (BKV) are leaving. By the end of April, 36 contracts had already been cancelled.
BKV in trouble
BKV’s board is meeting more and more frequently because many suppliers want to modify their contracts. The company responsible for Budapest’s transport aims to reach an agreement with all suppliers within the financial limits of the previous contract. A new tender would probably involve much higher costs, writes Népszava.hu.
The majority of suppliers want to increase their costs by 30–50 per cent.
The Budapest Transport Company can only afford a 10 per cent increase due to budget constraints. The suppliers’ explanation for their price increase includes the rising cost of raw materials and the Russian-Ukrainian war.
BKV commented on the case, saying that “the number of claims for contract modifications has multiplied due to the indirect economic effects of the war – exchange rate fluctuations, manufacturer price increases, delivery deadlines, shortages of raw materials, transport capacity, etc.” They added that “The number of contract terminations is also increasing steadily, in line with the number of requests for price increases, with 36 contracts terminated by business partners by the end of April this year. This represents an additional annual expenditure of tens of billions of forints.”
How big is the problem?
“Based on feedback from suppliers and manufacturers, manufacturers may experience disruptions and problems with raw material supply, supply chains, and transport, and the effects of these are expected to be felt in the supply of materials and parts to BKV.” BKV says that it is in constant discussions with suppliers and is doing its best to ensure that users of its services experience as few problems as possible.
No spare parts or technicians are coming from Russia for the trains of metro line M3.
BKV’s budget is still facing a huge deficit even without supplier price increases. The company plans to cover the deficit of several billion forints from municipal and government subsidies and loans.
There will be no fare increases or reductions in the number of routes.
This was said by Tibor Bolla, the CEO of BKV Zrt., in an interview with index.hu.
Source: index.hu, Népszava
3 Comments
Rumours are Rife – Sadly.
We have known for months the concerns and situations that have been un-folding in the Public Transport System in Budapest, Hungary.
The M3 – what an ABSOLUTE Disgrace – ongoing and delays after delays – and cost RISING – what a SHAM.
Governments are appointed to “get down and get dirty” earn there KEEP as Servants of the People.
PROBLEM that angsts me – is the growing list of matters that this Government are being inherited with – to FIX, not helped, by the WORSENING Economy of Hungary.
Bit of time bomb – and will worsening, which sadly citizens who rely on Public Transport – going to be the BIG Losers.
That’s what happens when a transport company (forced by the government) buys substandard crap on an over priced lease arrangement so that a few brown envelopes can be received by the government ministers involved.
This is ANOTHER example – of a Governments FOCUS being BLANTANTLY – centered on THEMSELVES first, what we individuals can “CREAM” – receive filling pockets and “Greasing Palms” – then the Civilians – come distant second, who receive the “Raw” Deal, that they because of Government – STUFF ups – pay the on-going HEAVY price, billed to them by the Government and paid out of their TAXES.
This “Culture” has continued to FLOW over – post 1989 in Hungary, replicating a HISTORICAL practice, that we know, through History, exists in Russia to-day – our FRIENDS – and the Civilians of Hungary – repetative in practice, occurrance & occasions – we are the LOSERS.
Post the National Elections 2022 – we have continued to be EXHIBITED broadsheet EXAMPLES – that contain FACT – in evidence, the destructive path- this re-appointed Government of Hungary – Fidesz Party, under the Leadership of the present Prime Minister of Hungary – Victor Orban – “pushes” us Civilians to bear & live with.
The Hungarian Government – who are their FRIENDS ???
We know Russia & China relationships but outside these (2) two countrys – who are FRIENDS of Hungary ???
The Hungarian Government – an Economy in Hungary – that all indicators used Globally – the componentry – used to anaylsis – a countrys Economic & Financial position – present, near & short term and FUTURE – continue to TREND in a STRONG Downward Motion.
Who are the FRIENDS of Hungary – and the “NEED” – to Stabilize – hold to-gether the Economy of Hungary – this daily is growing in its position of impact – or downside – on the Hungarian Economic landscape.
Hungary – if we haven’t – prepare ourselves for HARDER times – in the immediate – foreseeable Future & Sadly – Long Term.