Modern Transit System Comes to Cameroon, Thanks to U.S. Company

Bus partnership draws interest from investors, other African countries.

Washington -- In Cameroon, when 28 new buses moved from Douala, the port and commercial center, to the capital city of Yaoundé in August 2006, excitement was so high that people were lining the streets and the 200-kilometer highway connecting the two cities to cheer the convoy. The comfortable modern buses brought by Transnational Automotive Group (TAUG), a Los Angeles-based company, were a harbinger of something new for Cameroonians.

At that time, the capital had lacked a functioning mass transportation system for more than 15 years, and its streets were clogged with taxis, motor bikes and other vehicles packed beyond capacity with people, goods and livestock. On intercity routes, several operators competed, but they ran old or salvaged buses and the service was poor and sometimes unsafe.

“There was a screaming need for something better, more reliable and modern,” Seid Sadat, TAUG chief financial officer, told USINFO.

In 2005, TAUG’s founders, former auto industry veterans with experience in Africa, were asked by Cameroonian government officials to consider running city bus systems in their country.

Considered on a purely commercial basis, such an offer would have been rejected. City mass transportation systems worldwide tend to be either unprofitable or subsidized. But TAUG’s corporate mission is to facilitate work force growth and commerce in the developing world. So TAUG agreed to form a joint venture with the government the same year.

Building on economic momentum brought about by official debt relief in 2006, Cameroon’s president, Paul Biya, was eager to attract more foreign investment and create some immediate improvements in the daily lives of average Cameroonians, according to TAUG executives.

A well-functioning city bus service was a high-priority project because the government expected it to bring the most tangible benefits to the population in a short time.

TAUG Chief Executive Officer Ralph Thomson says that in the early stages the venture had to deal with some challenges related to cultural differences and different views on the very nature of business.

But the Cameroonian leadership, including the president and the prime minister, was eager to resolve any problems, Thomson said.

As a result, the September 2006 launch of LeBus, a subsidized city bus system in Yaoundé, was “notably smooth” and enthusiastically welcomed by city residents, according to both executives. It has served as a catalyst for positive effects on the city’s modernization efforts and the life of its residents, they said.

The biggest challenge turned out to be winning the confidence of ordinary people and convincing them that the company was in Cameroon to stay, Sadat said. TAUG, which employs 700 workers, all but three of whom are Cameroonians, vowed to become one of the largest employers in the country.

TAUG has introduced high-quality customer services and social programs. For example, schoolchildren, who used to walk three kilometers or more to school on unsafe roads, ride LeBus under supervision. Journalists have been promised discounted fares. The company also has promoted women drivers.

TAUG’s operations were watched closely by other African governments and local and U.S. investors, who had been somewhat skeptical about the feasibility of infrastructure investment in sub-Saharan Africa. (See related article.)

Those operations are successful by any measure, according to TAUG executives. In a year, LeBus has transported around 5 million passengers. LeCar, a wholly-owned subsidiary launched in December 2006, makes a decent profit running intercity buses between the capital and Douala.

Biya told company executives in October that he had received very favorable comments on the quality and reliability of their company’s services from many sources.

TAUG also won a 2007 State Department Award for Corporate Excellence for its work in Cameroon. At the award ceremony in November, U.S. Ambassador to Cameroon Janet Garvey praised the company for employment practices and its clean, comfortable and reliable service. (See related article.)

The company’s operations serve “as an example of how our nations can work together to forge win-win situations in Cameroon and serve as a model applicable across the African continent,” she said.

But the best evidence of the company’s success is invitations from the governments of 13 African countries that want TAUG to invest in their economies.

This success also opened “many doors” in Cameroon. TAUG, which already has increased its investment in Cameroon with support from a U.S. government agency, plans to expand into other sectors including oil, natural gas and renewable energy ventures, auto assembly, low-cost housing and quality hotel development.

More information about TAUG is available on the company’s Web site. More information about the ACE program is available on the State Department Web site.