Bus Market Size, Share, Growth, Industry Trend | Report 2031

Report Description

The global bus market size was valued at about USD 49.03 Billion in 2022 and is estimated to surpass USD 98.01 Billion by 2031, expanding at a CAGR of 8% during the forecast period, 2023–2031. The market is propelled by increasing investments, innovations, and advancements in public and private transport sectors.

Rising cost of fuel and concerns about environmental damage is resulting in governments and private transport organizations purchasing electric buses for transport purposes, which is the major driver of the bus market. The use of electric buses for public transport not only reduces fuel costs but also minimizes pollution and reduces other upfront costs, which is fueling their adoption around the world. For instance,

• As per the carbon neutrality goals declared by Xi Jinping, President of China, the nation’s “14th Five Year Plan (2021-2025) for a Modern and Comprehensive Transportation System” was published on 18th January 2022. It highlighted green transition development principles, people-oriented development, and focus on innovation. The plan also focuses on the crucial role of New Energy Buses (NEB) in China’s plan to reduce carbon emissions in urban cities. As one of the steps towards “Green & Innovative Mobility” about 72% of China’s urban public buses are anticipated to be electricity-based by 2025.

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As the COVID-19 pandemic is normalizing, the demand for city buses and school buses is expected to increase again as several countries have exited lockdown measures after the pandemic. Several regions experienced the highest decline in demand for buses in 2020, with the lockdown and stoppage of business activities. However, such regions are expected to regain the significant demand growth for new buses owing to the return to business as usual worldwide and rising focus on the upgradation of transport facilities.

Buses are a preferred mode of public transportation, as billions of people use public and privately owned buses for their day-to-day traveling needs. With growing demand and advancing techniques in the manufacture of electric vehicles, the prices for the electric bus are expected to come down to that of diesel fuel buses. Studies reveal that the use of electric buses has reduced maintenance and operating costs by about 83%. Thus, furthering its adoption for transport needs.

City buses and local tourist buses are also increasing on the roads with the opening of worldwide economies. The majority of the bus market in North America i.e., the United States and Canada, is comprised of school buses. Around 80% of buses are designated for school transport purposes. The remaining 15% includes city buses and the rest of the 5% buses are coaches. School buses are expected to recover with the end of homeschooling and the opening of schools post-pandemic.

Several governments are focusing on providing the necessary transit to support ridership. There is a rising need for public transit to increase accessibility for the individual. Easy processes and simple-to-use technology attract individuals to use public transport. It can be a more practical and handy method for travel. Mobility-as-a-Service (MAAS) models allow individuals to use apps to facilitate mobile ticketing. The individual can plan a journey to any destination within the city using the multimodal transport system.

Bus Market Dynamics

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Major Drivers

Increasing popularity of electric buses especially in Europe, due to the introduction of several measures by governments to control pollution levels is expected to boost the bus market growth. Electric buses are gaining popularity owing to the lower operational costs and environmental benefits. Electric buses have zero tailpipe emissions and are cleaner than gasoline or diesel engines. Electric buses reduce the carbon footprint and the risk associated with cognitive, respiratory, and other health issues.

Growing population and increasing government initiatives to reduce pollution and traffic congestion is boosting the deployment and use of buses, thus fueling the market. Consumers are inclined towards public transport due to rising fuel prices, which is projected to drive the market during the forecast period.

Existing Restraints

Rising adoption of passenger cars, as several consumers are buying personal cars and SUVs is expected to restrain the market. This subsequently affects the consumer preference for buses for intercity travel and a decline in revenue generation. Lack of independent security systems, such as video surveillance and access control, as well as a unified command and control platform are estimated to hinder the bus market growth.

Emerging Opportunities

Growing use of smart transportation assists is increasing the adoption of buses and is expected to create lucrative opportunities for the market players. Smart transportation utilizes information technology such as Artificial Intelligence (AI) to efficiently manage and coordinate advanced public transportation systems. AI technology can be used to monitor the buses and inform the operators when maintenance is needed. It helps to reduce carbon emissions and fuel consumption by ensuring that the buses are running at optimal efficiency.

Scope of Bus Market Report

The report on the global bus market includes an assessment of the market, size, share, trends, segments, and regional markets. Overview and dynamics have been included in the report.

Bus Market Segment Insights

Type Segment Analysis

In terms of type, the bus market can be bifurcated into single-decker and double-decker. The single-decker segment constituted a significant share of the market in 2022. These buses are employed for intercity, intracity, and interstate transportation. Additionally, they are employed to pick up and drop off children from school.

Rising demand for buses for long-distance journeys in numerous countries is fuelling the single-decker buses. Growth in the middle-class population is driving the demand for comfort, which is driving the usage of various buses. An increase in travel and tourism is projected to propel the need for double-decker buses, which are used for sightseeing and parties.

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Fuel Type Analysis

Based on fuel, the market can be segmented into diesel, electric & hybrid, and others. The electric & hybrid buses segment constituted a significant share of the market in 2022 and is projected to expand at a rapid pace during the forecast period. Growing need for electric buses is attributed to various measures taken by governments to reduce pollution. Additionally, improving infrastructure and the availability of charging stations in developing and developed countries are promoting the use of electric buses and thus, fueling segment growth.

The demand for electric & hybrid buses for sustainable and energy-efficient public transport continues to drive the segment. The electrification of public transport in various countries has driven the demand for electric buses, thereby boosting the segment. Furthermore, fuel is a major operating cost of any vehicle. The use of electric buses for public transport helps mitigate the increasing cost of fuel. The maintenance cost and operating costs of electric buses are 83% lower than those of diesel buses.

Application Segment Analysis

On the basis of application, the bus market can be divided into transit buses, intercity/coaches, and others. The transit bus segment is expected to register a robust growth rate during the forecast period. Increasing use of public transport is reducing the use of private vehicles, which in turn, is reducing congestion on the road and decreasing traffic.

Regional Analysis

In terms of region, the global bus market can be split into North America, Europe, Asia Pacific, Latin America, and Middle East & Africa. Asia Pacific is expected to dominate the market during the projection period, due to the higher population. In emerging countries such as China and India, consumers’ preference for public transport is high as it is cost-effective compared to other travel.

The market in North America is anticipated to expand at a rapid pace in the coming years, due to increasing demand for buses and rising populations in the region. Several countries are taking the delivery of new electric school buses and some states are planning to include more electric buses in the coming years, which is expected to boost the market in the region.

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