CHAPTER ONE

1.1     GENERAL BACKGROUND

Transports is an important economic activity. It is vital for the movement of goods and people. The developments of transport made have been a major impetus in economic development in the last three centuries. Imagine for a while the scale of trade that can exist betweenKanoandOnitshain the absence of well developed transport means.

In considering transport, we can look at several segments of transportation. There is the infrastructive requirement. Roads are necessary for pedestrian and other land transport equipment of which the motor vehicle is the most important. Similarly, airport, rail track and water way development are important for air, rail and water transport development.

(i)                The rolling stock of the corresponding mode of transport is another component of transportation that is important. The world has come a long way from transport by foot. From horse riding and horse draw carts, to river rafts and sailing ships, steam engines, we have today well designed vehicles, supersonic aircrafts, electric trains and super taker ships.

(ii)             The economics of transport is also an aspect of transportation that is critical to overall effectiveness. Let us imagine that there is an airport at Nkalagu, what will be the economic efficiency of operating an airline regularly to the place? What level of patronage exist to sustain the airport and airline as economic proposals? This as a (product) service, there must be demand for transportation. Remember that demand is need backed by ability to pay.

(iii)           The Technology of transport is also vital. All technology exist in the market for those who have the means of payment. It is evident that those who have developed transportation technology stand apart in today’s world. Name them,U.S.A,RUSSIA,JAPAN,GERMANY, FRANCE,ITALY,KOREA,CHINA.

All things considered, it is vital that all persons and things needed to be transported at cheapest possible cost. It is in this context that mass transportation, is considered. InNigeria, inland transport is predominantly by road. The development of roads and bridges is by the public sector, being as they are public goods the rolling stock is predominantly owned by the private sector. As a result of inadequate investment in the area, government has from time to time intervened in the sector through investments like: 

(a)              The National freight company

(b)             State transport companies like oriental line, Bendel line, TRACAS and ENTRACO.

General concern has always been for commuter transportation than goods because the effect of inadequate goods transports is evident in price. Commuter transport difficulties give rise to frustration and disorder.

 1.2     PROBLEM ANALYSIS

          The problem analysis therefore, is to know the imperatives of Mass transportation of commuters. What are the requirement roads, vehicles, maintenance of vehicles, use of vehicles, returns on investment, finance?

          Roads are part of public utility and therefore do not come for consideration in this work. AlthoughNigeriadoes not manufacture motor vehicles because we participate world trade, we have access to products). So we shall combine vehicle treat both as one variable. Use of vehicles and vehicle maintenances, will be treated as one variable and shall come into consideration, returns on investment is important because without it, continuity cannot be guaranteed. Finally, management structure, adequate for the characteristics of Mass transport business, especially cash accounting, is required. A viable business could fail due to poor management or negligence.

 1.3     PURPOSE OF STUDY

          We are concerned in this study with mass transit as a business and we shall limit our study to the strategy of the business. We shall examine the concept of strategy and seek to find whether the programme design of mass transit, especially under the federal urban mass transit programme, is consistent with the strategic concept.

 1.4     SCOPE OF STUDY

          ENTRACO (EnuguStatetransport) was founded as a mass transit company. We shall use this company as a case study, being a company bounded under the federal urban mass transit programme of the federal government ofNigeria.

          The study will limit itself to finance and financial returns on mass transport business structural around the best possible concept, revealed by the study.