300 Billion Won of Public Funds Spent, Yet Suspension... Another 'Light Rail Tragedy'

Incheon Maglev Train Stalled Due to Lack of Major Maintenance
Busan Gimhae Light Rail Transit Faces Persistent Deficit for 10 Years
Uijeongbu Light Rail Transit Dramatically Revived After Operator Bankruptcy

The operation of the Incheon Maglev Train has been suspended until the end of the year, drawing attention to the current status of domestic light rail transit projects. / Photo by Song Hyundo, Asia Economy intern reporter

[Asia Economy Reporter Lim Ju-hyung, Intern Reporter Song Hyun-do] The Incheon International Airport maglev train, which involved over 300 billion won of public funds, has entered a temporary suspension from the 14th until the end of this year. This is considered an additional case in the harsh history of Korea's light rail transit (LRT). Although LRTs have been introduced in various local governments so far, they have been plagued by issues such as declining demand and accumulated deficits.

◆Train maintenance impossible... Incheon maglev train halted until year-end

The maglev train operated by Incheon International Airport Corporation (IIAC) was constructed in 2016 at a cost of 315 billion won, connecting Terminal 1 of the airport with Incheon Yongyu Station, transporting commuters to and from work.

The reason for the suspension is inadequate mid-term maintenance. According to the Railroad Safety Act, electric trains must undergo regular mid-term maintenance every three years. However, due to scheduling issues between the corporation and the manufacturer, mid-term maintenance was delayed, and ultimately the corporation had no choice but to suspend train operations.

The problems faced by the LRT do not end there. According to data revealed during the National Assembly audit in October last year comparing "maglev railway demand forecasts and actual usage," the train was initially expected to have 20,494 users immediately after opening, but actual usage was only 2,479, about 12% of the forecast.

The appearance of the Incheon Maglev Train when it was unveiled in 2016. It was the world's second commercialized medium-low speed urban maglev railway following Japan. / Photo by Yonhap News

During the audit, Park Sang-hyuk, a member of the Democratic Party of Korea, pointed out, "There were plans for export and expansion when the train was developed, but these were not realized," adding, "It was introduced to apply new technology proactively at Incheon Airport and to accumulate operational records, but it did not have a ripple effect."

After the spread of COVID-19, the train was operated only during commuting hours temporarily, which also led to a sharp decline in passengers. The average daily ridership, which was 4,012 in 2019, shrank to about 320 last year, two years later.

◆Busan-Gimhae LRT marks 11 years since opening... deficit improvement remains distant

The Busan-Gimhae LRT, which opened on September 17, 2011, and has been operating for 11 years, is also unable to stand on its own without local government support. The Busan-Gimhae LRT connects Busan, Gimhae, and Gimhae Airport in between. The cumulative ridership over 10 years since opening reached 158 million.

The problem again is demand far below expectations. The Korea Transport Institute (formerly the Transportation Development Institute), which conducted the feasibility study in 2004 when the project was promoted, predicted that the LRT would have an average daily ridership of 176,358 in its first year and continue to increase, ultimately expecting 340,225 daily users by 2040.

However, the average daily ridership of the Busan-Gimhae LRT was only 50,631 in 2019. After the COVID-19 pandemic, ridership dropped sharply to 34,752 last year. This is less than 13% of the institute's estimated demand of 272,220 for the same year. As a result, the LRT operator has been running deficits every year.

Busan-Gimhae Light Rail Transit connecting Busan, Gimhae Airport, and Gimhae / Photo by Yonhap News

Consequently, Busan and Gimhae cities provide annual financial support to the LRT operator. Gimhae City, which bears a larger share, has provided a cumulative financial subsidy of 314.5 billion won over 10 years, including 48.6 billion won last year alone.

Some have argued that the institute excessively inflated transportation demand and failed in demand forecasting. In fact, in 2013, about 500 citizens from Busan and Gimhae formed the "Busan-Gimhae LRT Citizens' Countermeasure Committee Litigation Group" and filed a damages lawsuit against the Korea Transport Institute, claiming it produced a false report exaggerating transportation demand to justify the project. However, the court dismissed the claim, stating, "Even if there was illegality, the citizens are indirect victims and thus the claim cannot be accepted."

◆Uijeongbu LRT faced bankruptcy crisis of private operator

There is also a case that narrowly escaped closure after a bankruptcy declaration. The Gyeonggi Uijeongbu LRT, which opened on July 1, 2012, has been operating for 10 years. This train was constructed over six years from 2007 to 2012 with a total project cost of 676.7 billion won, but actual demand after opening was only about 15% of expectations, resulting in massive financial deficits. Eventually, the private operator running the LRT filed for bankruptcy in 2017, unable to withstand the accumulating debt.

The Uijeongbu Light Rail Transit, which was once operated by a private company that went bankrupt and faced a crisis, has achieved a dramatic recovery thanks to the city's swift response. / Photo by Uijeongbu City

Uijeongbu City quickly responded by forming a 'Crisis Response Task Force.' The city was concerned that if the LRT stopped, it would harm citizen convenience and the local economy. Although ridership was much lower than initially expected, the Uijeongbu LRT had already established itself as one of the core public transportation facilities used by nearly 50,000 citizens.

The city actively worked to prevent the train from stopping by negotiating with the private operator to jointly cover operating costs for three months. Thanks to these efforts, the Uijeongbu LRT was able to continue transporting passengers even during the private operator's bankruptcy proceedings, and a replacement operator was selected a year later in 2018, bringing the project back on track.

After experiencing this crisis, Uijeongbu changed the business model to have the city cover the minimum necessary costs for LRT operation, reducing the business risk for the new operator. As a result, the Uijeongbu LRT has been operating stably to this day.

This content was produced with the assistance of AI translation services.