Highway construction: There must be a limit for profit reaping

Eastern Dispersal Link Expressway (EDL) is 8.1km long, of which slightly over half or 4.0km is above-ground or elevated. It was stated in MRCB 2011 Annual Report that the total investment cost of EDL was at RM1.2 billion, or RM148.15 million per kilometer, making it the most expensive highway in Malaysia.

In contrast, the construction costs of 7.7km Ampang-Kuala Lumpur Elevated Highway (AKLEH) was RM751 million, or RM 95 million per kilometer.

Kemuning-Shah Alam Highway (LKSA), which was also constructed in 2007, its average cost of construction was RM51 million per kilometer, or RM750 million for 14.7km.

List of Tolled Roads Construction Started Construction Completed End of Concession Cost of Construction (RM million) Length of Highway (km) Cost per km (RM million) Average Traffic Volume per year (million)[1]
Ampang KL Elevated Highway (AKLEH) 1996 2001 2029 751 7.9 95.06 21.6
Guthrie Corridor Expressway 2003 2005 2035 501 25/td> 20.04 27
Kemuning-Shah Alam Highway (LKSA) 2007 2010 2047 750 14.7 51.02 23.4

Based on the average traffic volume, we will be able to calculate the profit that the concessionaire company is going to make at the end of concession period.

1. Ampang KL Elevated Highway (AKLEH)

Traffic Volumn / year (million) Class Toll (RM) RM (million)
21.6 class 1 83% 17.928 1.5 26.892
class 5 8.5% 1.836 1.5 2.754
29.646
YEAR
Toll collection (2001 to 2029) 28 830.088
Government Compensation (2008 to 2013) 119.22
TOTAL 949.308

2. Guthrie Corridor Expressway

Traffic Volumn / year (million) Class Toll (RM) RM (million)
27 class 1 83% 22.41 1.4 31.374
class 5 8.5% 2.295 0.7 1.6065
32.9805
YEAR
Toll collection from 2005 – 2035 x 30 989.415
Government Compensation (2012 to 2013) 22.17
TOTAL 1011.585

3. Kemuning-Shah Alam Highway (LKSA)

Traffic Volumn / year (million) Class Toll (RM) RM (million)
23.4 class 1 83% 19.422 0.9 17.4798
class 5 8.5% 1.989 0.9 1.7901
19.2699
YEAR
Toll collection from 2010 to 2047 37 712.9863
TOTAL 712.9863

Among all these 4 tolled roads, it looks like MCRB is the making the most profit, this is without considering the future increases in traffic volume and too hike.

List of Tolled Roads Cost of Construction (RM million) Toll collection at the end of Concession Period (RM Million)
Ampang KL Elevated Highway (AKLEH) 751 949
Guthrie Corridor Expressway 501 1,012
Kemuning-Shah Alam Highway (LKSA) 750 713
Eastern Dispersal Link (EDL) 1,200 4,313

Highway construction is not charity and we acknowledge that concessionaire companies are not non-profit organisations. However, there must be a limit for profit reaping. What was the mechanism used to calculate toll rate and profit for the concessionaire companies? Why it seems that MCRB is allowed to collect more toll than other concessionaire company? Government must be transparent in handling toll hike and all concession agreements should be made public asap.

DAP Assistant National Publicity Secretary & MP for Kulai
Media statement by Teo Nie Ching in Kuala Lumpur on Tuesday, 11th November 2014