Research On Cost Drivers Of Urban Railway Transportation

Urban rail transit, as a kind of urban transport modes, to a certain extent, is able to change allocation of resources and the aggregation of industries, to promote the expansion of the city and the sustainability of development. Although advantages of urban rail transit is obvious, because the huge amount of construction, operation and maintenance can hardly be made up by fare revenue, the development of urban rail transit in many cities is facing lack of investment, which results in the shortage of urban rail transit service (both in quantity and quality).To resolve the contradictions of the revenue and cost, there are two ideas. First, cost control, the control of urban rail transit construction and operating costs, which need to control the size of the rail transit network, to reduce the technical characteristics of facilities and equipment to reduce the variety of materials and power, labor costs. Second, institutional arrangements, choosing different institutional arrangements in different cities according to their own characteristics. For eample, some city governments provide direct financial subsidies, and some set up market mechanism to allocate resources, and some change the supply border of public and market to set up public-private partnerships. Cost control reduces the full life cycle costs of urban rail transit, different institutional models solve the specific supply and operational issues of urban rail transit, and to some extent, promote the development of urban rail transit.These two ideas have played a positive role, but in practice something are different. In cost control, the total cost targets are determined in the early stage of the project. By the full life cycle of specific cost control, the control means including strategic cost management, cost drivers and control by government departments or businesses. Institutional arrangements led by the government departments determine the framework of a mechanism to attract enterprises to participate in, and even new enterprises or restructuring of existing businesses to adapt to the new institutional arrangements.Urban rail transit has commercial and vendible character so whether domestic or in foreign contries, urban rail transit have adopted a market-oriented mode of operation. But urban rail transit has significant positive externalities, in the case of the lack of institutional environment, it is difficult to transform positive externalities into the areas of the income of urban rail transit. Urban rail transit investment is becoming more prominent, to a certain extent limits the healthy development of urban rail transit.The dissertation defines the composition and characteristics of the various stages through the analysis of urban rail transit life cycle cost, sums up eight important strategic cost drivers of urban rail transit, which are the size of the network, network layout, construction and operation experience, technology selection, employee performance, total quality management, capacity allocation and government collaboration. These strategic cost drivers in addition to the impact of construction and operation costs also affect urban rail transit’s internal returns and external social benefits. The author use AHP to determine the weight of strategic cost drivers, costs and benefits. Finally, by system dynamics modeling and analysis of the combined effects of the mechanism of the strategic cost drivers on costs, revenues, and the social benefits, the author opened up a new study perspective of urban rail transit.