Photo/Illutration West Japan Railway Co. officials are considering the future of the struggling Oito Line. (Asahi Shimbun file photo)

It's looking like the last stop is ahead for many unprofitable railway lines, as the transport ministry has formed a panel to consider ways to help railway companies ditch these burdens. 

For years, this has been a major headache for local companies operating in rural areas where populations have decreased.

But the slowdown in economic activity due to the novel coronavirus pandemic has also begun to hit some major companies, such as East Japan Railway Co. and West Japan Railway Co.

For the fiscal year that ended in March 2021, those companies all recorded net losses.

JR West officials indicated earlier this month they will begin discussions with local government officials about what to do with the Oito Line, which operates between Matsumoto, Nagano Prefecture, and Itoigawa, Niigata Prefecture.

A major focus of the transport ministry panel will be looking at ways to allow for bus operations to take over the transportation routes of unprofitable rail lines.

The panel will consider tax incentives and subsidies for companies that decide to replace train lines with bus routes.

Until now, only small companies were eligible for subsidies to replace equipment. But the panel will also consider whether the subsidy programs can also be extended to JR companies running unprofitable lines in rural areas.

According to transport ministry officials, train passenger volume peaked in fiscal 1991. Over the next three decades, rail passenger numbers suffered an overall decrease of about 20 percent.

Before the Japanese National Railways were privatized in 1987, officials would look at whether the average daily passenger volume fell under 4,000 per kilometer in deciding whether to replace unprofitable lines with bus operations. But 57 percent of all train lines in Japan currently meet that definition.

One major hurdle facing railway companies is that municipalities located along rail lines that could be replaced with busses always raise stiff resistance against the notion.

In August 2021, 23 prefectural governors submitted a request to the transport minister asking that he instruct the JR companies to exercise caution when considering whether to suspend unprofitable train lines.

The ministry panel hopes to convince them by coming up with examples of how other forms of transportation have improved the convenience of residents.

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