SOUTH KOREA: Uijeongbu LRT Co filed for bankruptcy at the Seoul Central District Court on January 11. The operator of the light metro line in the city of 500 000 inhabitants 20 km north of Seoul had debts of more than 240bn won at the end of 2016.
When the 11·1 km elevated U Line opened on July 1 2012, it was expected to carry nearly 80 000 passengers a day in its first year, but in practice it managed only 10 000. Ridership rose to 35 000 by the end of 2016. A daily average of 118 000 passengers is reportedly needed to break even, with 45bn won a year required to cover operating expenses. Uijeongbu LRT Co has been earning about one-third of that.
A group of five creditors, which lent a total of 352bn won to the operator, have applied for the company to be wound up. If the court declares the company bankrupt, operation of the U Line will be handed over to Uijeongbu city, which has a 45% stake in Uijeongbu LRT Co.
Under the original PPP concession, Uijeongbu LRT Co was to operate the U Line for 30 years before handing it over to the city government. Construction of the U Line cost 676·7bn won, with 52% of this being raised by Uijeongbu LRT Co. The remainder came from the national government, Gyeonggi provincial government and Uijeongbu city.