The world's fifth-largest land transport company, DelGro Corporation, is planning to seriously target the Irish city and inter-city bus markets once the Minister for Transport, Mr Brennan, starts franchising out routes next year.

The Singapore group's subsidiary, the Metroline Group, yesterday announced a 3.5 million investment in 10 new luxury coaches to operate on its Galway-Dublin Airport service.

Metroline said the inter-city bus market was worth 65 million a year and it hoped to take 50 per cent of this within three years, once routes were franchised out. A Metroline subsidiary, Citylink, operates two routes at present, Galway to Dublin Airport and Dublin Airport to Howth Junction (this service is known as Aerdart).

Metroline entered the Irish bus market two years ago when it bought out the Burke bus company of Galway. Along with Aircoach and JJ Kavanagh, it stands the best chance of winning lucrative routes next year when the Minister is due to begin the franchise process.

There are several other private coach firms, many of them in the tour business, but they are not expected to have sufficient scale to bid for major routes. Several large international firms are likely to be interested apart from DelGro/Metroline.

Mr Allen Parker, managing director of Citylink, said Metroline was also keenly interested in the Dublin bus market and was prepared to bid for up to 25 per cent of all Dublin Bus routes. "We think the Minister is going about it the right way and we are fully supportive of him," he said.

Mr Parker said Metroline and its parent DelGro had the resources to "ramp up" quickly and operate routes currently served by Dublin Bus. He said Metroline had introduced hundreds of new buses into the London market and a similar exercise was possible in Dublin.

He said the company was prepared to operate unprofitable routes too, once the Government provided the same level of subvention as received by Dublin Bus.

He rejected arguments from Dublin Bus unions that franchising out routes would simply double the number of buses on the roads. "The plans outlined by the Minister are for franchising, in other words there will be a single provider on a route, not two. Nobody is suggesting that the whole market be deregulated and a free-for-all be created. Companies like ours believe the franchising option actually avoids that sort of situation."

This week the unions at Dublin Bus criticised Mr Brennan for not publishing the accounts of Dublin Bus, which show a profit of 3.4 million for 2002. This was after receiving a State grant of €56 million.

The general secretary of the National Bus and Rail Workers Union, Mr Liam Tobin, said the Minister did not want the figures released because they did not suit his arguments about franchising out routes. However, the reason Dublin Bus and other CIÉ company figures have not been published appears to be because of a delay in compiling accounts for Irish Rail. A spokesman for Irish Rail said last night work was still being done on the accounts, particularly in relation to capital expenditure returns.