Political scion transforms PH buses
Philip Apostol, a scion of a political family in the Visayas, preferred riding public buses on his way to his office in Europe. When he returned to the Philippines five years ago, he found the experience not as comfortable, so he decided to establish a company to transform public transportation in Metro Manila.
The former banker and a son of Leyte Rep. Sergio Apostol shunned politics and left his comfortable life in Europe to introduce a new bus riding experience in the country.
“I lived in European city centers for years and was used to riding buses, trams and the metro. Public transportation was simply more convenient than using a car,” says Apostol.
“I moved to the Philippines and the state of public transportation is unsafe, uncomfortable and very polluting. So, I decided to operate a mass transport system that is rungs above what we have now,” he says.
Apostol is the principal and managing director of Green Frog Transport Corp., a company that rolled out the country’s first hybrid diesel-electric buses in Makati City.
The new and spacious hybrid buses started plying Gil Puyat Ave. and Kalayaan Ave. in Makati in May, surprising passengers with pleasant amenities on board. The environment-friendly buses are air-conditioned to 22 degrees Celsius for the comfort of passengers and equipped with six CCTVs to monitor all activities on the bus as well as GPS to transmit location and speed.
The buses have low floors, with only two steps from the pavement, for easy access and have two doors for front entrance and rear exit. They have luggage or shopping bag racks and provide special seats for persons with disability.
“Our buses are secure [six CCTV monitors that record all activity in the bus], comfortable and emit 80 percent less particulate matter pollution than current buses,” Apostol says.
Before he established Leaf Frog in 2009, Apostol headed the investment banking division of ING Bank in the Philippines in 2008. He spent three years in Ljubljana, Slovenia as the management consulting country leader of Deloitte then as the corporate finance advisory country leader at PriceWaterhouseCoopers. “I was a management consultant for years before I moved over the corporate finance. Both jobs were fun, intellectually fulfilling and I got to travel the world but always on an advisory role.
It was not a career plan to move to the transport industry,” he says.
A graduate of Ateneo de Manila University with additional studies from Columbia University-School of International and Public Affairs and Istituto Michelangelo in France, Apostol has the needed background to jumpstart a business.
“The combination of international finance, business development, management consulting and public affairs background have contributed to getting this project off the ground and will continue to help in growing this company into an industry leader,” he says.
Apostol needed to raise fund for the project, an area where he has expertise. “I created the financial model for the business, pitched to bankers and investors for funding, set up the corporate structure and processes, worked with local government and regulatory bodies for the permitting process and did the marketing to companies for the advertising on the buses. My business partner manages the day-to-day operations. Glad he is around,” he says.
Asked why he chose to introduce hybrid buses, Apostol says the country needs to change its public transport system. “We need to make our cities sustainable by upgrading the biggest source of air pollution—vehicles. The consequences are life threatening if we are not. We already see this in the high cases of respiratory diseases in Metro Manila,” he says.
A study by the World Bank shows pollution in Metro Manila is mostly caused by vehicular emission with 85 percent and the rest from solid waste burning with 10 percent and industrial pollution with 5 percent. Apostol says Green Frog hybrid buses emit 80 percent less particulate pollution or the black stuff coming out of tailpipes and consume 40 percent less fuel than regular diesel buses in stop and go traffic.
“My vision is to have as many hybrid and Euro IV buses operating in the Metro Manila and the rest of the country as soon as possible. Not only will we be decreasing pollution, we will also be saving fuel,” he says.
“Our 18-month plan is to have 38 hybrid and Euro IV buses operating by year-end 2014. When we hit this target, we go for the more ambitious plan in 2015,” he says.
Apostol says he originally wanted to import electric buses, but switched to hybrid buses because the technology for e-buses in the Philippines is not yet developed.
“When we put the business plan together, we were focused on pure electric buses. But after a year and half of research, stacks of literature, five trips to China, eight visits to the largest bus manufacturers, several visits to the biggest lithium ion battery manufacturers, our conclusion was: the technology just wasn’t there yet,” he says.
“The lithium ion batteries were the Achilles heel of the whole system. Until a significant technological leap occurs in battery industry, pure electric buses will remain a dream. At present, they are very expensive and have very limited range thus not commercially viable,” he says.
Apostol says in contrast, hybrid buses have been operating commercially for over four years in China.
“We inspected a four-year-old hybrid buses recently and it is still in service everyday. It has a Euro 3 diesel engine and lithium ion batteries. They haven’t even replaced the lithium ion batteries. It costs only about 20 percent more than a similarly configured diesel bus and emits 80 percent less pollution. So, it’s reliable,” Apostol says.
He says the hybrid engine system is made in the US by one of the biggest tier-one suppliers in the auto industry. Their hybrid systems are also used in Europe, Latin America, China and now the Philippines, he says.
Apostol says following the introduction of hybrid buses, Makati commuters quickly embraced Green Frog’s bus system and the public has been clamoring for more. In response, Green Frog is pushing for the delivery of six additional buses in August, eight buses in November and eight additional buses every quarter after that.
“Our pilot project has been very successful. We have a loyal ridership base which keeps increasing weekly. We see this in the upward trend in the sales of our prepaid cards. Incidentally, due to rider demand, we will now be offering two-week and four-week prepaid tap cards,” he says.
“We will be loading up the Buendia route with 16 buses. Then, two more Makati routes will be opened up within 12 months. When we achieve this, Makati will have first-world, environment-friendly, comfortable, secure and reliable bus service,” he says.
Apostol says Green Frog will also expand its reach to other cities and is currently in negotiations with adjacent cities in Metro Manila to establish more routes.
“And these routes will interconnect all these cities. We plan to keep going until we change the industry...I ride the buses to hear what our clients say. And it puts a smile to my face when they board the bus and tell their companions ‘ang ganda ng bus, para akong nasa first world country’,” he says.
“I heard this the first hour the first two buses rolled out and I continue to hear it,” he says.
Apostol says like in any new business, he met challenges while starting Green Frog a few years ago, but now the people managing the regulatory agencies are very supportive of the project.
“I learned a lot about local and national government processes and regulatory functions. Starting a business in the Philippines has been a real eye opener,” he says.
Apostol says despite the initial setbacks, he believes that experience is indeed the best teacher.
“You learn and evolve. You do things better next time. That’s the benefit of hindsight,” he says.
Apostol also believes that the introduction of the hybrid buses in Makati will eventually become a game changer in the Philippine transport sector.
“It wasn’t only the introduction of hybrid buses. We introduced a whole system along with the hybrid buses. We put up 34 designated bus stops along the route. Our bus stop signs even have the route map on them—a first in the country. We put six CCTVs monitoring and recording all activity in the bus, a GPS tracking system for all the buses. The buses have low floors and two doors and introduced a tap card payment system,” he says.
Green Frog’s drivers have passed the MMDA/Tesda bus driver certification course while their conductors go through customer service training.
“You put all these together and you truly have world- class bus service,” he says.
He says by October, Green Frog will have a fleet of eight buses operating on Buendia, which means there will be a bus in stop every 15 minutes. “This is when I think the game really changes,” he says.
“We plan to keep going until we change the industry. It’s a lot of work, frustrating at times but when things go our way, it is exhilarating,” he says.