Shares in Downer EDI Limited (ASX: DOW) are on the rise today after news the company's joint venture has been awarded the contract to run Sydney's Northern Beaches bus services.
At the time of writing, the Downer share price is up by 2.86%, with shares in the company swapping hands for $5.75.
The $900 million contract will see Keolis Downer run the Northern Beaches and Lower North Shore bus services for 8 years, beginning in October 2021.
Keolis Downer is a joint venture between multinational transport company Keolis and Australian industrial company Downer.
Let's take a closer look at the news boosting the Downer share price today.
$900 million bus services contract
According to Keolis Downer, it hopes to use its time running Sydney's Northern Beaches buses to introduce more frequent services and improved sustainability.
The $900 million contract was awarded by Transport for New South Wales (TfNSW).
During the 8-year contract, Keolis Downer will oversee a range of TfNSW initiatives, including the introduction of 125 electric buses. The electric buses will run from newly electrified depots in Brookvale and Mona Vale.
Keolis Downer's on-demand transport service Keoride will also become a permanent part of the network. Keoride allows public transport users to prebook a bus to arrive at a particular place and time. It then aligns other users' requests to make a custom public transport network based on users' needs.
Keolis Downer will also introduce innovative headway technology. The technology will help bus drivers keep track of whether they're running according to schedule. The company expects the technology to increase the reliability of the Northern Beaches bus service.
Commentary from management
Keolis Downer's CEO David Franks said:
We are very proud to partner with TfNSW to support the future growth and transformation of the Northern Beaches. Drawing on our experience locally and globally, we will launch a range of new initiatives to enhance the customer experience building from the already excellent bus services in the area…
We look forward to further engaging with the community to deliver a safe, efficient and reliable transport system that supports the liveability and future prosperity of this vibrant, growing region.
Downer share price snapshot
Downer shares have been delivering a solid performance on the ASX lately. Currently, the Downer share price is up by around 8% year to date. It's also gained around 25% since this time last year.
The company has a market capitalisation of around $3.9 billion, with approximately 701 million shares outstanding.
