Beijing subway fares poised to double

Tom Mitchell in Beijing
Chinese commuters crowd onto a subway car on the metro during rush hour in Beijing, China.
Kevin Frayer | Getty Images

Beijing's municipal government has warned users of the world's largest subway system that fare increases could more than double the cost of an average commute.

The Chinese capital's 17 subway lines carry almost 10 million passengers a day – twice the number of New York's – for a flat fee of just Rmb2 ($0.33) per trip regardless of distance.

Low fares are a boon for residents, especially those who cannot afford sky-high property prices in central Beijing and commute long distances to work.

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But the cheap fares also constitute a large and growing cost for the municipal government. Last year it increased the annual subsidy given to the system's operator, Beijing Infrastructure Investment, more than 50 percent to Rmb15.5 billion.

According to Moody's Investors Service, BII's operating income this year is expected to reach just Rmb5.8 billion.

Ahead of a public hearing on Tuesday, People's Daily, the Chinese Communist party's flagship newspaper, warned commuters that they would face an average journey price of Rmb4.4, with fares calculated according to distance traveled.

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The newspaper justified the increase by comparing the less than 3 percent of income spent on public transport by Beijing commuters with the 7 percent for users of Shanghai and Guangzhou's distance-based systems.

"Beijing's subsidy is too high," said Zhou Tianxiang, an infrastructure expert at Guangzhou's Zhongshan University. "Two renminbi is not a reasonable price. It will take time for people to accept it, but they will adapt."

The last time Beijing's subway fares were adjusted, in 2007 in the run-up to the Beijing Olympics the following year, they were lowered from between Rmb3 and Rmb5 per trip to the current flat rate.

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The change was part of efforts to expand usage of public transport to more than 40 percent of daily journeys – a strategy further undermined by China's emergence as the world's largest automotive market during the depths of the global financial crisis.

Reflecting the issue's sensitivity, Tuesday's public hearing was a tightly scripted affair with 25 participants including 10 "consumer representatives", eight members of Beijing's two public assemblies and three government administrators.

Foreign journalists were turned away from the event by officials who said the public gallery was too small to accommodate them.

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"I fundamentally agree with the government's proposal to raise subway fares," Fei Fei, a 32-year-old IT professional, said at the hearing according to a live transcript of the proceedings. Ms Fei, who said her monthly fares would double to Rmb177, urged small adjustments to the planned rises and discount structure for monthly passes.

Elsewhere, commuters appeared less enamored. "I don't have any other choice besides the subway because traffic is so bad," said Mr Li, who declined to give his full name. The 30-year-old salesman travels 15 stops on his daily commute.