Government safety officials swooped down on more than two dozen curbside bus operations that mostly ferry passengers in the busy East Coast transportation corridor between New York and Florida, shuttering them for safety violations in the largest-ever single federal crackdown on the industry.
Teams of officials for the Federal Motor Carrier Safety Administration, armed with legal orders declaring the bus operations imminent hazards to public safety, fanned out to 26 companies based in six states: Georgia, Indiana, Maryland, New York, North Carolina and Pennsylvania. Officials withheld details about the operation until Thursday.
The crackdown is a blow to curbside buses — companies that sell tickets online and pick up and drop off passengers on street corners, rather than at terminals. Curbside operators’ cheap fares, made possible in part by low driver salaries and minimal overhead, have upended the economics of the long-distance bus industry over the past decade. They also have a fatal accident rate seven times higher than other types of interstate bus operators, federal accident investigators said in a report last year.
The shutdown orders were carried out at the headquarters and at bus pickup locations of 26 curbside companies. A majority of the 233 bus routes serviced by the companies either departed from or ended in New York City’s Chinatown district, transporting an estimated 1,800 passengers a day mostly along the busy Interstate 95 corridor.
Besides the shuttered bus operations, 10 people — company owners, managers and employees — were ordered to stop all involvement in passenger transportation operations, including selling bus tickets, the Transportation Department said.
The shutdowns are the culmination of a yearlong investigation by the safety administration that focused on three primary companies: Apex Bus Inc. and I-95 Coach Inc., both of New York, and New Century Travel Inc. of Philadelphia. Each of the three companies oversees a broad network of other bus companies, officials said. The other bus operations targeted in the crackdown are companies affiliated with one of the three primary companies, but have different names.
Phone calls and emails to the three primary companies seeking comment were unanswered.
The shuttered companies are “very, very bad actors,” Transportation Secretary Ray LaHood told reporters in a conference call. “By ignoring safety rules, these operators put both passengers and other motorists at serious safety risk, and shutting them down could save lives.”
Safety officials long have complained that their attempts to put unsafe bus operators out of business are frequently thwarted by “reincarnated carriers” that simply reopen for business under a different name or in a different location, or that transfer their buses to an affiliated company that shares similar ownership. Buses belonging to such rogue companies are known in the industry as “ghost” buses because they are frequently painted white with relatively little decoration to make it easier to repaint them with a new company name.
Mr. LaHood called on Congress to pass legislation closing legal loopholes used by reincarnated carriers, as well as eliminating a jurisdictional gap that prevents the safety administration from regulating bus industry brokers, including ticket sellers, if they don’t directly transport passengers.
The motor coach industry carries more than 700 million passengers a year in the U.S., roughly the same as the domestic airlines.
Bus industry officials said they have been urging the government to crack down on unsafe operators and were aware of the investigation before the shutdowns.
“These businesses have been doing all they can to operate far below the accepted level of safety,” said Dan Ronan, a spokesman for the American Bus Association.
Industry officials long have contended that rogue carriers represent a small segment of passenger bus operators.
The shutdowns applied to nine active bus companies, 13 bus companies that had lost permission to operate but were continuing to operate anyway, three companies that were in the process of applying to the government for operating authority and a bus ticket seller.