What are the ups and downs of owning a Jeepney business in the Philippines?

Question

I am trying to help a friend of mine start with 2 or 3 Jeepneys but I want to be sure that it would pay for itself and more. Anyone have any numbers to provide me? Please No guessing just hard fact numbers.

Spotter your suggestion is very interesting. Maybe you can tell me more about why you think an airport service, School Bus or Water business would be more ideal

Definitely good answers from all of you and it is giving me a clear idea that maybe Jeepneys are not the way to go. I am welling to help my friend to start up something that would generate income for the rest of her family. At the same time, I don't want to end up supporting for one reason or another.
I will just raise another question.

Answer 1

Personally, I'd go into another line of business given you have the funds to buy 3 jeepneys. Maybe hotel/airport taxi, school bus or rent a car. Better yet open water refilling store. Not complicated franchised business.**

Answer 2

Jeepney Business Philippines

Answer 3

The Jeepney business is a barely break evan on some months and a very small profit 2-3,000 peros per month per unit on a good month.
A new Jeepney costs P350,000 for a standard 21 passenger. Remeber too that the only thing new about a new jeepney is the body and tires. The are made up of surplus aka junkyard parts. They only come with a 30 day guarentte if any at all and are only as good as the shop where you bought it reputation.
Jeepney owners rent the units out to drivers at a rate of P500-P600 per day. The owner is responsible for all maintance and the driver pays for the fuel used and daily rental fee.
All PUJ's need a route and must be appied for at the LTO and the route's cost P30,000 to P40,000 for a five year period. Anual regestration costs with insurance and smoke checks cost P12,000 per year. Fare matrixs cost P 500 each and have to be kept current. So each time there if a fare change you have to buy a new matrix.

Now you have some hard numbers to consider. Do the math and also factor in for usual maintance items like tires P1.200 ea, Brakes P1,600 (if only brakepads) and the occasional busted hose leaky radiator, piston rings set etc. I hope your friend is able to maintain the Jeepney or evan more profits will go down the tube when you need to have a mechanic come fix the inevitable breakdowns.

You can probably pick up a used older type jeepney for P100,000 to P150,000 but I guarentee it will need some major repairs before it is roadworthy.

Been there done that. Internet cafes, water businesses, sari sari's the are all barely greak evan or small profit. There is just way too much competition. You really neeed for your friend to think outside the box to fill a need that would be profitable here.

Answer 4

Are you talking Multi Cabs or the full size Jeepneys? We have 6 full size Isuzu Jeepneys and the only way to make money is to have a good trustworthy mechanic or you will lose your investment. We charge rent instead of a percentage of the fare and the driver is responsible for the fuel so we know each day what the income is. As for what to expect for maintenance, tires, oil, brake linings, clutches if you figure 50% of the gross rent you'll be fine.
DON'T invest in the small Multi Caps, the small gas engine does not hold up to the abuse and you'll be replacing many engines.

Answer 5

i suggest that you just give the jeepney business to her and have her take care of it. if you expect to earn back what you give, you will be in for a wide awakening. a jeep, any vehicle for a fact will depreciate everytime you turn the ignition. wear and tear and upkeep will likely be expensive if you do not know a reliable mechanic and a trustworthy one at that. you may have the best of intentions but i have to admit that we, pinoys, have a knack of putting one over another be it a friend or a relative. most cities would have franchising fees for public transportation so it is not easy to just put out a unit and ply it. insurance is not important back home so you have to have good drivers. get feedback as to how the conditions of public transportation is in the place you plan to base your units at. not wanting to sound pessimistic but do it if oyu trust your friend.

Answer 6

I don't like the way some jeepney drivers take off before you sit down. Especially when someone who is holding a baby.That is so rude and ignorant. That is my only problem.

Answer 7

I see only downs.

The jeepneys are relics, and they are a nuisance to most everybody. They are pollutants. I guess, and I surely hope, that one day they will be phased out completely.

Answer 8

unless you drive the jeepney yourself then it would be able to provide you with your basic needs. but if you would depend on just the "boundary" then it would amount to nothing much. you have to consider that jeepneys depreciate faster than real estate properties and cost for spare parts are going up faster than fuel cost. the safest form of investment would still be in real estate.**

Answer 9

yes, i do believe oneiloilojeepney up there, has the math just about right.

& 1 more thing, i do find that even though bigger transport businesses would tend to thrive, smaller ones with limited capital tend to fold, because of the inherent dangers within the transport business for there just tends to be a lot more unexpected things happening with a 'moving' business or something that have wheels.

& of course, you do need an ace mechanic real bad, not to mention good drivers

but just like in anything, be creative, find a need & then fill it.

Answer 10

Just like getting a hammer and hit yourself with it. The following problems you'll encounter;

1. Dishonest drivers
2. Short or no remittances at all.
3. "Buayas" in getting franchises at LTFRB
4. "Buayas" in LTO enforcers.
5. Maintenance (For sure, you'll get a surplus engine)
6. Accidents