Egged has grown again and may lose a tender worth hundreds of millions

The Public Transport Authority at the Ministry of Transport is considering preventing Egged from participating in the tender for operating the Hashmonaim public transport cluster, which includes the cities of Modiin, Modiin Illit, Ramle, and Lod. The Authority found that Egged's share in the public transport sector exceeds the activity ceiling set for it under the Competition Authority's plan, after the group was declared a monopoly.

In a hearing letter summoning Egged to present its position, the tender committee notified Egged Holdings that it is considering limiting its participation in the tender, which is estimated to be worth hundreds of millions of shekels and operates about 400 buses. The reason for the possible restriction is the size of the tender: the Hashmonaim cluster is expected to operate about 26 million kilometers of vehicle travel per year, and its operation by Egged, or a company owned by it, would exceed the 35 million annual kilometer ceiling set by the Competition Authority.

In June 2023, Egged already won a tender for the Western Jerusalem Envelope cluster, with a volume of more than 15 million kilometers per year, and therefore it has only about 20 million kilometers left within the limit. Even without the restriction on the Hashmonaim cluster, Egged is already larger than the ceiling set by the state. As of June 2026, the group's share stands at 27% of the sector's activity in terms of kilometers, while the competition plan sets a threshold of about 25%. Even in future calculations, its share is still expected to stand at 25.8% in June 2029.

The restrictions in question are part of a reform intended to dismantle the historical centralization in the bus market. At the end of the 90s, Egged and Dan controlled about 95% of the public transport sector, and in May 1999, the Antitrust Commissioner declared Egged a monopoly in passenger transport services. The current framework was formulated in the 2018 competition plan and was intended to continue reducing Egged's weight, among other things by putting lines out to tender and limiting its ability to win them.

Now, according to the Public Transport Authority, delays in implementing the competition plan have exacerbated the problem, and the postponement of tenders planned for previous years allows Egged to maintain a high share over time.

"Egged has received the tender committee's letter on the matter, is studying the contents, and will respond accordingly. According to our initial assessment, there are good arguments justifying our participation in the tender, and we will bring them before the relevant authorities," Egged stated.