The first week of Queenstown's new bus services went "quite well", according to the Otago Regional Council (ORC).
Five new 23-seater buses began operating between Queenstown and outlying residential areas, including Arthurs Point, Kelvin Heights, and the Lake Hayes Estate last week.
ORC corporate services director Wayne Scott said the bus service was well received by the public. The new Connectabus service would be on trial for 32 months.
Regional council ratepayers and the New Zealand Transport Agency had each funded 50% of the $3.2 million investment.
The aim was for the service to continue as a fully commercial operation after January 2013.
Mr Scott said Connectabus had more than 1000 passengers last week, predominantly on its main services between Queenstown, Frankton, Fernhill and Arrowtown.
"There were some challenges with traffic congestion but the operator has put on extra buses to make sure they are on time," he said.
Connectabus had also employed extra drivers for the new routes and to increase frequency of its existing services.