I believe in public transit, and I believe that there are times when public transit needs to be subsidized or run as a non-profit business rather than using a strict for-profit model.
There are some aspects of public transit that may need to be improved even at the expense of profits. These include the geographical area covered and the frequency of bus/trains. But capacity is something that can be trusted to profit. If there aren't enough people using transit to justify an increased capacity from a financial standpoint, then it is not something that should be forced.
Public mass transit companies should not be forced to increase capacity by governmental actions. The decision to increase capacity on a given route or system should be dictated by the ridership (actual and projected) as well as increases in the base population along the given route or system. A capacity decision should always a reflection of cost vs benefit.
Mass transit companies should not be forced to increase capacity. Mass transit is a service offered by a business, and it is up to that business to run in the best way possible. They should be allowed to determine what capacity they can and want to support. If demand goes up then it is up to the business to meet that demand. Regulation should not be in place to force a level of service if the demand is not there to necessitate it.
I do not believe that mass transit companies should have to be forced to increase capacity. One of the reasons is because I do not think that there is a need for it yet. A lot of buses, trains, etc, are still for the most part not being used by the public here in the United States of America.
Now I don't live in a huge city but our transit buses are not nearly full as it is. Why would we force them to increase capacity when they are already struggling to get people to ride? That seems like an extreme waste of money especially considering a large part of our transit is government funded and the government is broke as is. Save the money!