This article provides a methodology for solving the bus network design problem, covering network design and frequency setting and taking into consideration that commercial speeds of buses vary depending on the aggregated frequency of buses on each corridor. This methodology, referred to as Variable Speed Methodology, uses a variation of an algorithm proposed by Baaj and Mahmassani that assumes speeds remain constant (denoted Fixed Speed Methodology). Both methodologies were applied to the street network of Barcelona. Outputs were compared, and it was found that the Variable Speed Methodology produces a bus network with faster average travel speeds, shorter travel times, smaller fleet size, less route kilometer, and fewer buses per link while still serving the same level of demand. These results demonstrate that taking variability of bus speeds into consideration when performing route generation and frequency setting can significantly improve the performance of the bus network produced.

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