UMTA, then selectively used this research to support their pro-privatization programs. However, sellers are always looking for ways to eliminate their competition, and in reality they often succeed. Eventually, one or two major players will dominate the market, and the industry will be back to a monopoly situation where the provider has greater leverage in charging a higher price. Westchester County serves as an example of this situation. Contrary to the intentions of privatization advocates, the majority of successful players winning transit contracts are large national multi-product firms, as opposed to small, efficient, entrepreneurial operators.
Private operators feel insulated from the direct contact with and responsibility to the rider.
The way in which cost is measured in the bidding process gives advantage to private sector contractors. When evaluating the cost of service provided by public sector or non-profit bidders, public agencies use the method of fully allocated cost, which includes the direct costs of service plus overhead for administration, facilities, etc. Therefore, public providers are at a disadvantage in the bidding process. Additionally, private contractors are able to cover a loss through cash flow from other operations until they are able to obtain more power in the market and then raise their costs. Lower labor costs is one of the most dominant arguments used by privatization advocates.