More than just a metro: Establishing Taipei Metro as a life enterprise – An interview with Mr. B. C. Yen

More than just a metro: Establishing Taipei Metro as a life enterprise – An interview with Mr. B. C. Yen

The Taipei Metro is one of the leading metros in Asia today, with its high level of service and reliability. One of the visionary leaders behind its success is none other than Mr. B. C. Yen, the President and the Acting Chairman of the Taipei Metro.

Having served in the industry for over 30 years, Mr. Yen spent the first 20 years of his career establishing the Taipei Metro system. He subsequently became president of the Kaohsiung Metro as they were developing the network for Taiwan’s second largest city, before moving on to the Taiwan High Speed Rail Corporation as they, too, just entered operation, where he stayed until his retirement. However, in 2015, he came out of retirement to lead the Taipei Metro once again, at the invitation and request of the incumbent Chairman of Taipei Metro.

At Asia Pacific Rail 2018, we had the pleasure to interview Mr. Yen about the establishment of the Taipei Metro, the nurturing of its people and culture, and striving ahead towards Metro 2.0.

Building the Taipei Metro

The Taipei Metro launched its first operating line in 1996. The planning, designing, testing, and finally commissioning and operating of the systems started in 1987. Like any other system, there were a lot of challenges during the initial operations. After a lot of effort learning about the systems, we eventually managed to overcome these obstacles and increase the reliability of our metro operations. It was a necessary learning curve.

Right from the beginning, the Taipei Metro ran on two systems – one is the unattended train operation (UTO), the other is the typical metro operating system. Managing two different operating metro systems at the same time presented a lot of issues we had to spend time to overcome. This was especially true for the UTO system, as the construction agency ended its partnership with the system suppliers due to conflicts; there were problems in terms of technical issues, operating procedures, and spare part procurement. We sourced parts from all over the world and gathered all top experts in the field from around Taiwan to thoroughly understand the core system.

After a year of endeavour, we overcame several challenges and major issues, and had better knowledge of the system those information and experiences, even feed back to the system developers and suppliers . This was the case even for the replacement and repairs of the spare parts. Taking the time in the initial stage to thoroughly understand the systems gave us the confidence to tackle and resolve any operating challenges, as well as the commissioning of later lines in the network. This was a crucial factor for us.

Another crucial factor was the construction of the lines. During construction, we had the opportunity to learn how Hong Kong and Singapore operated their systems. We learned that in a new urban metro system, things needed to be done differently than in a traditional railway. We had to develop a “metro culture”. Today, this is what we are praised for. If you visit a Taipei Metro station, you’ll notice how clean it is, and how polite the passengers are, queuing in orderly lines to board, and giving up their seats to those in need. Our passengers are developing a civic etiquette which is becoming ingrained into our society. What we deliver to our customers is so much more than just a smooth metro journey; we also contribute positive and valuable influences toward nurturing a metro culture.

Mr Yen (right) with Mr Adi Lau, Operations Director of MTR Corporation

Taipei Metro Phase I

In Phase One, we set out to become one of the best metro systems in the world; and after 20 years of hard work, I believe we have achieved this goal. We did experience a lot of problems, but a crucial factor in our success was to build up the confidence of our teams to tackle them successfully. This in turn gave them the desire to learn and to persevere when faced with future challenges.

In the past, we used to conduct daily analyses, but now we conduct weekly analyses of our metro operations, to thoroughly understand the different situations occurring across the network; from systems, facilities, operations, passengers, and management perspectives. When you know the issues and their causes, you can solve them early and nip them in the bud to prevent bigger problems from arising in the future. With 5-10 years of experience, you can easily solve the problems because you recognise them from previous experiences. Some may arise due to the system design, in which case you need to rely on human management to mitigate the disruption caused – your maintenance and operation teams then need to work together to resume operations as quickly as possible. It’s not just about how to solve the problem, but to solve it in the shortest time possible, as time is crucial to our passengers. All these experiences contribute to achieving our high reliability standards.

Taipei Metro Phase II

After 20 years of operations, we are now looking ahead to Taipei Metro 2.0 and what we are going to do is to take it to greater heights.

Urban metros are an integral part of city life. When you are in a large city, it is very difficult to imagine living without a metro system. In Phase Two, we need to explore the kind of services and metro operations needed to meet the needs of the people. Because the metro system is an integral aspect of city living, the metro system becomes more than just a mode of public transport; it becomes a “life enterprise”.  

So how do we establish this “life enterprise”? By ensuring that every station provides a lot of amenities and services that passengers need.

However, the Taipei Metro is a publicly-owned organisation, unlike in Hong Kong, where there can be a retail arm that is a pure commercial development; so we need to find a balance between delivering a public service and ensuring business profitability. Delivering a high level of convenience to passengers remains our key objective.

As a public transportation service, we need to deliver excellent service and high reliability. To deliver convenience to the public, we need to be aligned with the government’s traffic and transportation plans and policies; i.e. integration of all modes of transport – metros, buses, taxis, and public bicycles. Both the government and metro operator need to work together in the development of this urban mobility integration plan.

In Taipei, we need to ensure high efficiency while maintaining low ticket prices. We have never yet raised our prices since the beginning of our operation. To ensure business profitability and to sustain the salaries and bonuses of our workers, we took several initiatives to raise non farebox revenues. Since we cannot build a new commercial mall to generate revenue (as this is managed and owned by a different government body), we relocated our offices to more remote locations, allowing us to develop the core station areas for commercial use. In recent years, we have opened up new revenue streams from advertising and retail rentals, thus increasing our business growth.

Advice for new metros – Establishment and renewal

As the establishment of metro networks is a key aspect of urban development, Taipei was lucky to have planned well in the beginning. There are several things a new metro needs to consider. Firstly, since it’s a holistic plan, you need to consider upstream city developments. In upstream urban development, there will be commercial zones, industrial zones, and residential zones. So, in the city, there will be a lot of economic activities. If you plan your economic activities well, you will know how to plan out your public transport – from upstream to downstream. Once this is done, you can easily map out your estimated ridership and set the right index; i.e. how long your headways should be, and how crowded or packed your cabins should be. Once you have the right index, you can pick the right systems by releasing accurate specification for tender. You should pick a system to match the needs of the people, not the other way around.

Once you have your service standards in place, you can easily and practically design your stations and opt for the best systems. I think this is what new rail operators need to plan out first.

Once it is built, the focus shifts to the operation. You need to gain thorough knowledge of your systems. Many metro systems experience a bathtub effect. There will be a lot of problems and challenges in the beginning, but these will ease out eventually. However, after 15-20 years of operation, new problems will start to arise as the system ages. This is what we are working on in Phase Two – “How do you renew or refurbish your system?”

To renew your system, first you need to know it well, understand its lifecycle, and what happens when it fails. When you see that there’s a surge in the failure rate, you know that you need to start renewing the system – all this can be accumulated through years of experience. As every system is different, you will need to collect a lot of information to help with your planning. As we discussed today at the conference, the most important thing is that you have the finances to support the renewal. We started to prepare for this renewal 20 years ago, and we are likely the only metro in the world that is ready for its asset lifecycle renewal. Singapore, too, is following our framework.

From the beginning, the Taipei Metro has tasked itself to be self-sufficient and self-funded, and not rely on governmental support in the future. So not only did we need to ensure that we had sufficient revenue for daily operations, we also had to save up for future renewal projects. Every year we need to put aside a large sum of money for future renewal plans. Our long-term finance plan is a rolling 30-year plan that is being evaluated biannually. As your metro network grows, the number of systems, and hence the estimated amount of money required for future renewal, becomes even greater. So, every few years, we need to sign a new agreement with the government to indicate the amount of money to be set aside into a special replacement fund. This gives assurance to both parties that there will be sufficient funds for asset renewal and smooth metro operations. This is something that other metros can learn from.

To sum up, you need to:

  1. Ensure reliability and stable operations
  2. Ensure profitability of your metro
  3. Save up for future asset renewal

New & Existing Projects

In Taipei, the construction and operation of the Metro are managed by different units. The construction of new metro lines is managed by the Government, while the operation of the metro system is managed by the Taipei Rapid Transit Corporation. Across Greater Taipei City, there is a total of approximately 100km of planned and developing projects coming up, which will double the current network. We currently have approximately 130+ km, and in the next 10-20 years, the total length of the network will reach 280km. Future developments will depend on government plans.

We have taken the necessary precautions in the operation of the metro system based on the lifecycles of our assets. In the future, whether these assets will be managed by the Taipei Rapid Transit Corporation or by a newly established corporation will depend on future developments. For example, in the whole of metropolitan Taipei, there are already the Taipei Metro, the New Taipei City Metro, and the Taoyuan Metro. However, for the existing lines that we operate, the finance for our asset renewal plan is ready with some additional budget just in case.

The total Budget for replacement is approximately NT$ 1 Billion every year, but there are several “peaks” when you use the budget. For example, when you replace the rolling stocks, the budget will surge, but if you do some minor replacements, such as communication systems, then it will be smaller. The timeframe of the replacement depends on the calculation of the lifecycle. If you add up 30 years of renewal fees, it’ll give you an approximate total expense and you can average it out. So, for example, this year we will need to put around NT$ 4 Billion into the replacement fund to ensure the budget remains within management.

Upcoming renewal projects & key considerations

At the moment, the most important system up for renewal is the signalling system, since there are new systems available. We need to decide which of these will make suitable replacements, that’s why we are gathering information on the different systems to find out which of them is more reliable and how we  could enhance our system with it. Renewals on the Brown Line are more complicated than those on the Green Line, because on the Brown Line signalling system renewals may not interrupt operations. How do we implement the new system and switch out the old one without halting the service? It has been done a few times in the past, for example, we switched the ATO seamlessly without passengers experiencing any disruption. We installed the new system outside of operating hours, and, once it worked properly, the new system was introduced the next day, so service was unaffected, even though there might be a couple of challenges during the first few days. We will face the same issues during coming renewals, so we started to study it, and learned from other operators like Hong Kong, New York, Europe and so on.

Managing old assets to meet growing new demands

Our system has stabilised in phase one and would remain stable in future. Yet, as your assets reach replacement age, you need to consider newer replacement methods. Ridership continues to grow, and you should consider how to lower the breakdown rate, and how to resume operations quickly in case of disruption.

At this point, you need to do more than before, so you need real time information. In the past, you solved the problems as they arose; but now, if you collect a lot of real time information, and analyse it along with experience, you will be able to predict the issue before it happens and resolve it ahead. Collecting information from all your systems requires a lot of new technology. As soon as you hear some creaking sounds or detect vibration on the rolling stock, you need to start investigating the problem so that you can fix it before breakdown.

Once the necessary information is collected, the data will be processed into actionable insights or visualization, to identify trends and critical points and programme alarms to notify you. Thresholds are determined by experienced experts so that we can get the critical data that we need.

Metro 2.0

We are using new systems and technologies to improve the efficiency and reliability of our core operations. On the business side, we ask how we can commercialise physical spaces with new technology. How can we provide more information to our customers (through mobile and electronics)? All this requires a lot of new technology – you need to constantly innovate your services and facilities.

Our belief is centred on customer experience. You need to adapt to the changing times, so our SOPs need to evolve as well. When you operate a large rail network, you’ll realise that passengers behaviour varies depending on the different lines, different stations, different days and times. Your service will have to adapt and be personalised to their needs. There is a shift towards a customer-centric mindset, and we have implemented a lot of initiatives to meet the needs of our passengers. We apply a lot of innovation in business and operations to enable us to stay on top of our game.

On Asia Pacific Rail

Through this event, we have learnt that all the operators and system suppliers are improving very quickly, so we have to work harder to improve our metro systems as well. We’ve seen and heard a lot today and had the opportunity to network and learn from many of our peers. This is a considerable and valuable takeaway for us. In the future, we will be sending more teams to attend international conferences like Asia Pacific Rail.

Mr. Yen (5th from the right) together with his Taipei Metro team.

 


About Asia Pacific Rail

The 21st Annual Asia Pacific Rail 2019 will be held on 19-20 March 2019 at Hong Kong Convention and Exhibition Centre. Join us as we discuss the key innovations, technologies and strategies transforming the future of rail. Join us now at www.terrapinn.com/aprail

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