The development of motor transportation in the Mandatory Palestine, and later in the state of Israel, was connected to the special geographical and social conditions of the region. At the end of the First World War, some young settlement members purchased trucks from the British army surplus. These trucks were converted into busses by fastening benches to the truck beds, and they began to transport passengers for pay. In the difficult conditions of those days - poor roads, the drying up of marshes, and Arab rioters - the Jewish settlers realized that only through partnership would their transportation businesses survive. They merged into small groups, which joined larger groups and later became cooperatives that continued the unification process.
The “Darom” and “Yehuda” cooperatives merged in the southern part of the country in 1931, and the “Mikasher” cooperative was founded in Jerusalem. At the beginning of 1933, the “Egged” cooperative was established by the unification of the “Mahir,” the “Hagah,” “Kadima,” and the “Achdut HaNahagim” cooperatives. Egged had 963 members and 20 employees who operated 338 buses on consistent routes between Tel Aviv, Jerusalem, and Haifa. In addition, public transportation was made available to settlements along their routes, and they provided regular transportation services to neighboring countries: Lebanon, Syria, Iraq, Tansjordan and Egypt.
Series of Unifications 1934-1955
Along with the expansion of the young cooperative Egged in central Israel and the continuation of mergers of small cooperatives within it, a similar process took place in the north and south of the country. Small groups of drivers united into larger cooperatives, and these groups continued to unite until they formed the “Shachar” cooperative in the north, which united all of the groups operating in the Haifa and Zevulun regions. Meanwhile, in the South, the “Darom Judea” cooperative was created by the unification of the “Darom” and Judea” groups.
The trend of unionism spread beyond these cooperatives. The Tel Aviv municipal cooperative, the "Ma'abir", merged with "Ichud Regev" and created "Dan". When the state of Israel was established, the first Minister of Transport, David Remez, proposed that all public transportation operators be included in one national cooperative. After many discussions on the matter, on November 1, 1951, Egged, "Shachar" and "Darom Judea" merged into a cooperative which initially named itself with an acronym of each company’s initials. However, after a few months, cooperative’s management decided to return to the name that it had been given by the national poet Chaim Nachman Bialik – “Egged.”
From the day of its establishment until today, Egged’s public transportation services have been integrated into Israel’s defense and security activities. During the time of the British Mandate, the settlement leadership would attach British crowns to the heads of the Jewish drivers, who served during the 1936-1939 riots despite the ambushes on the roads the fatal danger involved in these journeys. During the War of Independence, armored Egged buses were integrated into the supply and reinforcement services that made their way into besieged Jerusalem through Sha’ar Hagai. Undeterred by gunfire, it is no wonder that in light of the daring feats of Egged drivers the legend of the heroic Hebrew driver was born.
The Three Wars and Unification of the “Mikasher” 1956-1979
Egged’s services have long been intertwined with national defense and security operations. Prime Minister and Minister of Defense David Ben Gurion declared on the Knesset podium, "I am full of admiration for our drivers, who behave with exemplary heroism during wartime and deserve a more heartfelt commendation than any of us.” In the three major wars that took place after the establishment of the state – Operation “Kadesh” in 1956, the Six-Day War in 2967 and the Yom Kippur War in 1973 – Egged cooperated closely with the nation’s missions. Egged drivers secretly left their homes on draft nights to bring soldiers to the battlefields, they accompanied the troops on the buses throughout the operations and sometimes used the vehicles to attack enemy positions.
From the foot of Mt. Hermon to the 101st kilometer on the road to Cairo, Egged buses were utilized as personnel, ambulances, supply, and command vehicles on all fronts, and also transported Egyptian and Syrian prisoners to detention camps on the backlines. The buses of this period, the “Tigers,” proved that they moved as well in the open fields and sand dunes as well as they did on the road. In the period between the Six-Day War and Yom Kippur War, Egged opened a number of service lines throughout the Sinai Peninsula, both for IDF soldiers in the outposts as well as for civilians traveling in the area.
In times of emergency, Egged set up an emergency headquarters in the bomb shelter of its offices in Tel Aviv, from which it coordinated all its activities for the defense establishment and managed the limited public transportation system on the home front. At headquarters, a national communications system and control center for equipment for prolonged stays (including food, field beds, first supplies, water and more) were established. About six months before the outbreak of the Six-Day War, the series of mergers that characterized the establishment and development of Egged was completed when the veteran cooperative the “Mikasher” merged with Egged. This union came at the exact right moment, for immediately after the end of the war, the capital from the merger initiated a process of accelerated development, and Egged deployed an extensive network of service lines, reaching every new community in Israel with a population.
The Era of Mercedes, Volvo, “M.A.N.” and “D.A.F.” 1980 - 2004
The year 1980 was a turning point in Egged’s fleet supply, as it recruited the world’s most modern and sophisticated buses, including models from Mercedes were put into service. The old “Tigers,” which had served loyally for many years, were retired. Today’s comfortable Egged buses are modern, luxurious, air-conditioned, and equipped with comfortable seating and noise and movement prevention systems that preserve the quality of the environment and life of Israel’s residents.
Following the integration of various Mercedes models, Egged also purchased sophisticated buses manufactured by Volvo and M.A.N. In addition, the cooperative introduced low-floor buses that align with curbsides into its municipal services, thereby easing the entrance and exit of passengers. Today’s Egged is a modern public transportation operator, that looks to passenger welfare and provides them improved services and a wide range of choices. Egged’s network of lines is spread throughout the country and reaches every community, even the smallest of them. Egged’s operational infrastructure includes 43 local branches, three regional operation areas, sophisticated central stations, offboarding and onboarding terminals at central junctions and more than 20,000 bus station posts along roads throughout the country.
Currently, Egged’s biggest challenge is dealing with the congestion on the roads, which does not allow the buses to move at a proper speed and disrupts planned timetables. In some of the nations most congested traffic routes, lanes have been designated for public transportation, but most of them are not enforced by police enforcement and many private vehicles "invade" these lanes, diminishing their efficiency. The government made a strategic decision to allocate private routes to public transportation at the entrances of major cities and in their centers, and even ordered the establishment of a special unit within the national traffic police to enforce proper use of these routes. While these steps are still in their infancy, it is hoped that upon their realization the level of service that Egged will provide will be greatly improved. However, even in the present situation, riding the bus is much more convenient than driving alone, allowing passengers to reach their destinations without the irritation of driving on crowded roadways, and helping them save time and resources on finding a parking space in the center of the city.
Fares and Ticketing
Egged bus fares are determined by the Israeli government, according to its own considerations; the government dictates the price to be paid by passengers and the relative portion of the proceeds that the state will subsidize from its budget. The state subsidizes discounts for designated populations – the elderly, youths, those receiving welfare services, and soldiers. Egged receives payment for its services under a contract signed between both parties, and the agreement includes an accounting system.
Frequent passengers have a wide variety of ticketing options, which provide significant discounts and allow for broad use of inexpensive bus services. The most popular ticket option is the “Chodesh Chodshi,” a monthly pass which allows unlimited travel in a given area for the cost of only 40 trips. Other cards offer 2, 6, 11, 15 and 20 trips, and passengers can also purchase day passes for unlimited municipal travel during operating hours.
The Technology Era 2005-2007
With the advance of the government’s public transportation reforms, through which 20% of Egged’s service lines were appropriated to other companies, Egged’s management has made arrangements to continue to be Israel’s public transportation leader, even in the midst of a new, competitive era.
At the beginning of 2004, the “Hof HaCarmel” Central Station was inaugurated on the western outskirts of Haifa, effectively completing opening the transformation of public transportation in Greater Haifa. Bus lines were changed, traffic framework was changes, and inner-city transport was replicated from the city’s center to the eastern (“Lev HaMifratz” Central Station) and to the western (Hof HaCarmel Central Station) corners of the city. In 2006 Egged took another step forward when neighborhood minibus lines were introduced into the Carmel region, creating an efficient, convenient, and environmentally friendly solution for the neighborhoods’ residents.
In parallel, Egged established Egged Transport, a subsidiary established in cooperation with the “Ta’avura” group to participate in tenders for service lines that were formerly operated by Egged and Dan. The company has already won tenders in the cities of Elad, Ashkelon, and in the western Negev and Ashdod, and continues to participate in all tenders issued by the Ministry of Transport.
2004 to 2007 were years of accelerated technological development for public welfare and streamlining operations. In these years the information databases provided to the public were expanded through the customer service center, and now include travel information on intercity, intracity and mixed service lines. An interface system was activated between Egged’s database and cellular telephone companies, allowing customers to receive information about service lines via SMS.
Additionally, the central stations were equipped with toll-free, green telephones that connect directly to the customer service center, through which all information can be obtained. Other improvements included access to timetables through automated information kiosks, a website where customers can access line information, and ticket vending machines that accept credit cards, making it easier for the public to purchase tickets. The possibility of ordering tickets to Eilat with reserved seats was also extended through the customer service center and the website (the project was canceled in 2007). Public inquiries were streamlined to the customer service center, shortening response times. Towards the end of the period, the installation of a satellite tracking system for all Egged buses began, enabling the management of an efficient and advanced fleet of vehicles, providing reliable and up-to-date information to the public about the next bus arriving at each station. The tracking system installation took about a year and ended at the end of 2007.
Breakthrough to Europe 2008-2013
In parallel with continued technological development and the streamlining of Egged’s services (with special attention to protecting the environment and making municipal buses accessible to the disabled, elderly and mothers with strollers), “Egged” turned to other business development channels in Israel and abroad. New business channels included:
- Providing residential, parking, and fueling services to external bus companies at Egged service centers throughout the country
- Participating in the mass transportation service group that won the tender for the red line of the Light Rail in Greater Tel Aviv (from Petah Tikva to Bat Yam)
- Forming partnerships in public transport companies in various Eastern European countries
Egged’s first European partnership was established with a private transportation company in Varna, Bulgaria, but did not prove fruitful. Later, a partnership called "Egged Europe" was established with the municipality of Rusa in Bulgaria to operate public transportation in the city. The joint company operates 60 electric trolley buses and another 40 regular buses there.
Egged later created a partnership with a public transportation company in the Warsaw, Poland to operate a cluster of lines in the city. After a while, Egged Europe acquired its partner's share and Egged became sole owner of Egged Europe. This company also won tenders for the operation of clusters of lines in the city of Krakow and became the largest private public transport company in both cities.
Afterward, Egged Europe partnerships were established with the Polish Ministry of Finance to operate clusters of lines in the cities of Bydgoszcz and Morag and in the region of Masuria in northern Poland. Towards the end of 2011, Egged Europe was operating 1,600 buses in intracity and intercity service lines throughout Poland, including transportation of packages, special fixed and occasional transportation and tourist trips. Today, Egged Europe is the largest public transport operator in Poland.
In early 2011, Egged Europe began operating dozens of urban and suburban service lines in the Waterland area around Amsterdam, the capital of the Netherlands, using 220 new buses that had been purchased for this purpose. This was the company's first entry into Western Europe. Back in Israel, Egged’s profit centers introduced a new method for measuring efficiency. The method measures each department’s achievements in terms of expenses and revenues, its productivity and its staff’s motivation to generate profits. As part of this method, a policy of individual and personal reward for success was introduced. The method was then expanded to service taxis and led to the creation of a cooperative agreements with licensed taxi companies.
Within this framework, a plan was completed for the integration of public transportation via taxis and buses in Rishon LeZion. Tourism projects are operated through its subsidiary, “Egged Tours and Leisure,” which is the largest in the field of educational tourism in Israel and one of the largest tourism companies in Israel. In 2008 Egged Tours and Leisure operated the “Magic 1” cruise ship. It also has a cooperation agreement with the Travelers in the United States for incoming and outgoing tourism between Israel, the United States, and Canada.
Looking to the Future
The Israeli government’s reform of public transportation has already seized 28 percent of Egged's lines so far and is expected to take another 12 percent in the next decade. During this decade, there will be significant changes in the structure of public transportation in Israel, some of which have already been implemented, some which are being implemented, and some that are yet in the planning stages. Changes include:
Comprehensive service line reform took place in the Gush Dan region, in which parallel lines were unified, routes were changed, long routes were divided into segments, and lines with low numbers of passengers were cancelled. Additionally, an hourly ticket was introduced, allowing passengers to switch buses within 90 minutes for the price of a single fare.
- In Jerusalem, the light rail was completed and is operational, and seven high-speed bus routes were established on the main lanes, and municipal service lines were changed by creating lines for the light rail and for express bus transportation. In parallel, work continues on the construction of the high-speed railway from Tel Aviv to Jerusalem, which will facilitate door to door in 28 minutes. Construction is scheduled to end in 2017. The train is expected to greatly reduce the travel time of Egged’ flagship lines 405 and 408.
- In Haifa, the opening of the “Little Metro,” offering express bus transportation between the Krayot and Hof HaCarmel Central Bus Station will demand revision of the public transport system in Greater Haifa, namely for the creation of feeding and distribution lines for the “Little Metro” from all parts of the city.
- Between Haifa and Beit She'an, a railway was built along the route of the famous valley train, and its operation will provide a quick transport between the valleys and the capital of the north, regardless of congestion on the roads.
- Express bus transportation similar to that of the “Little Metro” in Haifa is planned between Bilu Junction and Greater Tel Aviv.
- The planning of the railway to Eilat, which is intended to become operational the 2020s, is expected to have meaningful impact on bus lines to Eilat.
In light of this new reality, Egged is committed to maintaining its status as the leading operator in Israel and continuing to expand its activities abroad in order to create alternative sources of income, utilizing the cooperative’s long-standing knowledge and capabilities. In this framework, actions are being taken to adapt resources to changing conditions, to reduce expenses and to improve efficiency in all areas of activity. Other business opportunities are also being examined in various European countries, and the company is prepared to provide consulting services in planning and operation of public transportation to municipalities and other authorities that operate such services. Egged also intends to participate in tenders for clusters of lines seized from it during government reforms, as the grace period extended to the operators who won them are now ending.
At the beginning of 2011, Egged established a subsidiary for special trips called "Egged Hayasim," which provides regular transportation services to places of work and factories and rents out vehicles for occasional trips and for domestic tourism. The company's fleet numbers 227 buses (as of the beginning of 2013) and is in constant expansion.