Increasing　public　transportation　subsidies　have　created　fiscal　pressures　for　governments.　To　ease　this　financial　pressure,　Chinese　government　strongly　encourages　private　capital　investment　in　public　transportation.　However,　previous　private　capital　investments　in　public　transportation　operations　have　largely　failed,　mainly　due　to　low　ticket　fares　that　cannot　support　sustainable　operations.　To　address　this　issue,　several　previous　research　projects　have　developed　methods　to　facilitate　private　capital　investment.　The　majority　of　the　research　focuses　on　qualitative　analysis　and　value　for　money　analysis.　Our　research　proposed　a　new　method　of　private　capital　investment　in　public　transportation　operations　based　on　the　concept　of　＂passenger　value.＂　The　feasibility　of　the　proposed　method　of　private　investment　was　analyzed　quantitatively　by　constructing　a　bilevel　programming　model.　The　model　was　verified　based　on　a　sample　analysis　of　Jinan　city　traffic.　Results　showed　that　effective　private　capital　investment　increases　the　total　societal　benefit　from　the　public　transportation　system　and　additionally　that　the　investment　method　considering　＂passenger　value＂　is　superior　to　the　traditional　one.　A　quantitative　tool　was　provided　by　the　model　to　evaluate　private　capital　investment　effects,　design　investment　policies,　and　develop　further　research.