Why is the expressway, which has an annual income of 500 billion yuan, still in a state of loss, and where does all the money go?

By the end of 2020, the total length of expressways in mainland China had reached 161,000 kilometers, ranking first in the world. According to the toll standard of 0.4-0.5 yuan per kilometer for small vehicles and 0.6-1 yuan per kilometer for large vehicles, the annual revenue of the mainland expressway can reach 500 billion yuan.

But what is puzzling is that even though the revenue is already so high, the expressway is still in a state of loss every year. However, in contrast, the highways in the United States are basically free, but they are still profitable every year.

Why is this economic paradox?

First of all, as mentioned above, the total length of highways in the mainland is 161,000 kilometers, while the total length of highways in the United States is only 89,000 kilometers, which is half of the mainland.

Secondly, there are the natural conditions. The geography of the continent is very complex and varied, with not only high mountains and plains, but also hills and deserts. Take the Sichuan-Tibet Expressway from Chengdu in Sichuan Province to Lhasa in Tibet as an example, it is about 2,154 kilometers long, making it one of the highest roads in the world. Along the way, you will have to pass through many mountain valleys, plateau lakes and snow-capped glaciers, and you can imagine how difficult it is to build.

At the same time, the construction cost is also a big one. Based on the concept of "building roads if you want to get rich", local governments will spare no effort to invest in infrastructure construction in order to promote local economic development. As a result, it often leads to the accumulation of debt, which requires high tolls to pay off construction costs.

The terrain in the United States is relatively flat, and the infrastructure was built earlier, so the construction cost will be relatively lower now. In addition, the U.S. government has adopted a variety of ways to subsidize highway operations, such as fuel taxes, excise taxes on automobiles, and parking taxes.

The above describes the difference between the continental highway and the American highway, and now let's talk about why the continental highway loses money.

In fact, in the final analysis, there are no more than three factors: construction costs, operating costs and management costs.

The construction cost is well understood, and the engineering materials and construction personnel required to build a highway all belong to the construction cost.

The operating cost is a long-term and huge overhead that needs to be maintained after the high-speed passage. For example, repairing damaged road surfaces, greening on both sides and in the middle of highways, drainage systems in rain and snow, and ensuring 24-hour highway access, surveillance cameras, emergency phones, and road lighting all require time and money to operate.

The final administrative costs include inspection and maintenance personnel, as well as back-office administration and planning departments. All in all, a highway can be perfectly presented and used safely by people, and every link is indispensable behind it.

In short, how to reverse the loss-making situation and realize the sustainable development of expressways is a problem to be solved. But in the end, I would like to ask you: Do you think it is possible for the mainland to achieve free passage for highways like the United States?