Breakdowns mount, MTC fines EV bus operator Rs 9.5 crore

CHENNAI: The Metropolitan Transport Corporation (MTC) recovered more than Rs 9.5 crore in penalties from its electric bus operator, OHM Global Mobility, during 2025-26 for failing to meet service level obligations, even as bus breakdowns rose sharply through the year, according to an RTI reply.

OHM operates 625 AC and non-AC electric buses in Chennai under a 12-year Gross Cost Contract (GCC). MTC pays the operator Rs 80.86/km for AC buses and Rs 77.16/km for non-AC buses, subject to a minimum assured operation of 200 km per bus per day.

The RTI reply shows that MTC paid OHM Rs 80.60 crore (unaudited) during the financial year, while recovering Rs 9.51 crore (unaudited) as penalties under the Service Level Agreement (SLA). The performance data points to a steady deterioration in reliability.

Breakdowns increased from zero in June 2025 to 97 in July, 99 in August, 154 in September, 213 in October, 150 in November, 215 in December, 224 in January, 246 in February and peaked at 372 in March 2026.

Despite the rise in mechanical failures, accidents involving the GCC buses remained low. Two accidents were reported in October 2025, one in January 2026 and two in March 2026, while there were none in the remaining months.

Under the GCC agreement, the operator is required to maintain fleet availability of around 95-98%, meet reliability standards and achieve the minimum assured daily kilometres. Failure to meet these benchmarks attracts financial penalties.

While the RTI reply did not provide a break-up of the penalties, MTC officials said deductions were made every month based on OHM’s performance against priority and non-priority service standards. “The penalties are levied every month based on performance. The mechanism is intended to improve service standards and follows a globally accepted model,” a senior MTC official said.

The RTI reply, however, does not specify the reasons behind the sharp increase in breakdowns or the month-wise penalties recovered from the operator.