Urban Transportation — Lessons learned from Colombia’s TransMilenio success vs. Germany’s Stuttgart 21 disaster

By Valerie Scheer

In 2012, Colombia’s infrastructure ranked #64 on World Bank’s Logistics Performance Index vs. #1 Germany [1]. However, this nation who prides itself on being highly disciplined and organized, failed miserably compared to the developing country. Columbia’s new BRT system (TransMilenio) and Germany’s Stuttgart 21 (remodeling of Stuttgart’s train station into an underground station) yielded different results.

Phase 1 of TransMilenio has been a huge success and became one of the most acclaimed and imitated transportation systems.

In contrast, Stuttgart 21 (construction period 2010 – 2021), is still highly controversial, sparking several large protests [2] and exploding budgets (from estimated €3 billion in 2009to €7 billion in 2012[3,4]) that might even lead to project cancellation [5].

So what are the key factors leading to success or failure?

 

1) Government Support

TransMilenio was built on the goodwill of politicians and strong leadership from the mayor, allowing for collaborative efforts and fast elimination of roadblocks.

Stuttgart 21 is challenged by financing from the EU, federal government, state government and German Railway — several parties with differing views and priorities. Unlike the former government, neither Stuttgart’s newly elected mayor (2012) nor the newly elected government of Baden-Württemberg (2011) is a big supporter of Stuttgart 21. Also recently, a report from the federal government leaked, calling continuation of the project into question [6].

2) Concept

TransMilenio has aspirations to expand substantially, yet has a sound economic business model (no operating subsidies, “modest” CAPEX of $240 million).

Stuttgart 21, in contrast, appears to be less about logistic or economic needs but more about building a legacy for key leaders. Several experts have argued for cheaper and equally efficient alternatives to Stuttgart 21.

A feasible, economic concept is not only important to ensuring project realization, but critical to creating public acceptance and reducing financial burden to the developer.

3) Stakeholders

TransMilenio involved key stakeholders (e.g., bus operators) early on in the planning and implemented large marketing campaigns.

Stuttgart 21 put the focus on obvious stakeholders (such as politicians and people living near the train station), completely neglecting the German population as a whole. The billions of tax Euros spent on this project in an era of high state debt gave way to strong opposition and public dissatisfaction was one strong reason why Baden-Württemberg’s former governing party of nearly 60 years has been deselected, leading to further decreased support of Stuttgart 21.

4) Project Structure/People

TransMilenio was realized within 36-month thanks to an appropriate project structure. Experts provided input and contractors were selected through a competitive bidding process [7].

While Stuttgart 21 also implemented competitive bidding and German Railway had extensive experience developing train stations, several issues prevented a more efficient project.

Given the number of financiers involved, the project took many years from idea (1994) to realization, resulting in compromises and increased costs. Also, as a state-owned company, German Railway’s board of directors comprises predominantly of politicians with lack of infrastructure expertise and potential conflict of interest (Baden-Württemberg’s Minister of Transport is also on the council of a RE-developer building a new mall on the old train station land [8]).

 

Summarizing these differences one could question whether Stuttgart 21 would have been more successful with a PPP (as for TransMilenio)?

 

 

[1] The World Bank, Logistics Performance Index 2012   http://lpisurvey.worldbank.org/international/global?sort=asc&order=Infrastructure#datatable

[2] Stuttgarter Zeitung, So viel Protest wie noch nie                                  http://www.stuttgarter-zeitung.de/inhalt.demonstration-gegen-s-21-so-viel-protest-wie-noch-nie.dedd248a-36a7-49ca-8a31-2b1cd57b0399.html

[3] State parliament of Baden-Württemberg, Finanzierungsverträge zum Bahnprojekt Stuttgart–Ulm                                                                                            http://www9.landtag-bw.de/WP14/Drucksachen/4000/14_4382_d.pdf

[4] Der Spiegel, Bahn-Prestigeprojekt: Ramsauer spielt Kritik an Stuttgart 21 herunter http://www.spiegel.de/politik/deutschland/regierung-spielt-zweifel-an-stuttgart-21-herunter-a-881593.html

[5] Der Spiegel, Prognosen der Bahn: Regierung bezweifelt Ausstiegskosten für Stuttgart 21                                                    http://www.spiegel.de/wirtschaft/soziales/stuttgart-21-aufsichtsraete-zweifeln-an-kosten-fuer-den-ausstieg-a-882243.html

[6] Stuttgarter Zeitung, Beim Bund mehren sich die Zweifel an Stuttgart 21 http://www.stuttgarter-zeitung.de/inhalt.vertrauliches-dossier-beim-bund-mehren-sich-die-zweifel-an-stuttgart-21.4b46aa2c-3c0a-47fc-9a97-e54480e542f4.html

[7] The National Council for Public-Private Partnerships , TransMilenio Case Study http://www.ncppp.org/undp/bogota.html

[8] Die Zeit, Ministerin Gönner sieht sich mit Filz-Vorwurf konfrontiert    http://www.zeit.de/wirtschaft/unternehmen/2010-10/stuttgart-goenner-einkaufszentrum

Picture_Stuttgart 21

Picture: Der Mobilitäts Manger, Stuttgart 21 vermutlich bis zu 1 Mrd. Euro teurer                                     http://dmm.travel/news/artikel/lesen/2012/12/stuttgart-21-bis-zu-1-mrd-euro-teurer-47051/

 

Advertisements