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The Kuwait Public Transit Company (KPTC) provides the only source of mobility for a large percentage of the low-income expatriate labourers in Kuwait since the price of the taxi system - the only alternative mode - is beyond their reach. The KPTC also provides transportation services for schools, private agencies and government ministries, as well as for the handicapped. The KPTC transit fleet includes a variety of bus vehicles purchased from different manufacturers. In this research study, performance indicators for a sample of transit routes are computed and the maintenance and operation cost records for nearly 1000 buses were obtained from the files of the KPTC and analysed. Unit costs for each bus type were calculated and compared. In addition, the life-cycle cost - one that includes capital investment, maintenance and operation expenses, as well as salvage value - was also calculated and compared. The results indicated that a significant reduction in costs would be accomplished if the route operational policies, purchase-decisions and the daily operation level of the buses were based on their life-cycle cost.