As pointed out by Mizutani and Urakami (2003), the local bus
sector in Japan suffers from several problems, namely: (1)
a continuous decline in ridership; (2) operating deficits; (3)
decreasing financial support from the government; (4) large cost
differences between public and private operators; and (5) difficulty
in maintaining bus services in small communities.
Similar to the situation in other developed countries, ridership is
in a state of continuous decline, partly due to the growing use of
private cars and subsequent deterioration in driving conditions,
and partly due to the construction of other public transport
systems, such as underground modes of transport, which make
passengers switch from local buses to other modes of transport.
The number of passengers using local bus transport declined to
4267 million in 2007, which is less than half the figure in the peak
years (e.g., there were 10,144 million passengers in 1968). In
comparison with three metropolitan areas, the decrease in the
number of passengers in rural areas is remarkable due to the
prevalence of private cars.