AG: Obsolete spare parts contribute to millions in losses for Rapid Bus

The Auditor-General’s Report 2019 Series 2 has revealed that a total of 13 types of spare parts for buses worth RM 1.54 million went unused and eventually became obsolete, while 12 types of spare parts worth RM 281,583 were damaged. This has contributed to massive losses for Rapid Bus.

These spare parts were purchased between 2015 to 2019 for China-made buses from manufacturers Dong Feng, Anyuan, King Long Higer, King Long Euromawar, and Sheng Long. These buses were utilised from 2013 to 2015 and were taken out of service from 2016 onwards.

The report explained that as Rapid Bus was using China-issued buses, they were unable to work with Vendor Management Inventory (VMI).

Rapid Bus previously worked with VMI from April 2014 to November 2015 to supply parts for the fleet of Scania and Volvo buses that were utilised at that time.

Working with VMI was supposed to allow Rapid Bus to acquire spare parts for their buses while reducing on-hand stock and also prevent the purchase of parts that were not needed. Hence, Rapid Bus was forced to purchase these spare parts for the fleet of buses used from 2013 to 2015.

Now, Rapid Bus will dispose of RM 1.54 million worth of unused and obsolete parts. A check also revealed that 12 types of consumable spare parts worth RM 281,583 have been damaged.

So, in total, Rapid Bus will dispose of RM 1.82 million worth of spare parts in 2021. The report also added that the increased maintenance cost was due to the age of the buses and the high price of spare parts for different bus models affected the expenses of Rapid Bus.

Rapid Bus has been reporting massive losses for 2017. The bus operator reported a loss of RM 217.83 million in 2017, while in 2020 it reported a loss of RM 282.29 million. However, the losses in 2020 were attributed to the lockdown implemented in March 2020.

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