Transit Bus Market size was valued at USD 431.3 billion in 2022 and is estimated to register a CAGR of 8.1% between 2023 and 2032. The surge in bus passenger journeys is significantly driving the market growth. With an increasing number of people opting for bus travel, the demand for transit buses has soared. According to the Northern Ireland Public Transport Statistics, from 2022 to 2023, there were 60.6 million bus passenger trips, marking a 19.9% rise from the 50.5 million recorded in 2021-22. This trend is fostering innovations and competition among manufacturers to meet the rising demand, resulting in advancements in technology, design, and efficiency.
The growing urbanization, marked by the continuous influx of people into cities, is significantly propelling the transit bus market size. Urban areas experience higher population density and increased traffic congestion, creating a vital need for efficient public transportation systems. Transit buses provide a practical solution for commuting challenges in the densely populated areas, which makes them a preferred choice for urban dwellers. With the expansion of cities and growing urbanization, the demand for transit buses is increasing. This is driving market expansion and encouraging technological advancements to meet the evolving urban transit needs.
|Transit Bus Market Size in 2022:||USD 431.3 Billion|
|Forecast Period:||2023 to 2032|
|Forecast Period 2023 to 2032 CAGR:||8.1%|
|2032 Value Projection:||USD 936.9 Billion|
|Historical Data for:||2018 to 2022|
|No. of Pages:||200|
|Tables, Charts & Figures:||273|
|Segments covered:||Fuel type, application, and seating capacity|
|Pitfalls & Challenges:|
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High initial costs pose significant obstacles to the transit bus market demand. Purchasing modern buses, especially the eco-friendly electric or hybrid models, demands substantial investments, straining the budgets of transit agencies. Limited funding reduces their ability to expand or upgrade the fleets, hindering the adoption of advanced transit solutions. The high costs discourage potential buyers, leading to a slower replacement rate of older, less efficient buses, thus limiting the overall growth and modernization of the market.
The transit bus industry suffered a severe setback owing to the COVID-19 pandemic. Lockdowns, social distancing measures, and public apprehension about using public transport significantly reduced commute. Transit agencies faced revenue losses, service reductions, and increased operational costs for implementing safety protocols. Manufacturers experienced reduced demand, disrupted supply chains, and delayed orders. These challenges, coupled with economic uncertainties, hampered investments in transit infrastructure and fleet upgrades, negatively impacting industry growth.
The extensive adoption of electric buses is fostering lucrative growth of the transit bus industry. The increasing environmental awareness and government initiatives promoting eco-friendly transport are driving the demand for electric buses. For instance, in September 2023, the U.S. and India joined forces to increase the presence of electric buses in India. Approximately 10,000 electric buses are set to be introduced on Indian roads through this collaboration. This trend will encourage technological advancements and innovations among manufacturers, creating a competitive market. As more cities are transitioning to electric buses, the market will expand, generating substantial revenue.
Government initiatives aimed at enhancing public transportation are instrumental in augmenting the transit bus market revenue. Government subsidies, incentives, and policy frameworks promoting the expansion of public transportation networks will encourage the adoption of transit buses. Investments in infrastructure, coupled with initiatives promoting eco-friendly transportation including electric buses. Such initiatives increase the demand by fostering a conducive environment for public transport development, encouraging manufacturers to innovate, expand offerings, and ultimately drive market value.
Based on fuel type, the diesel segment held over 65% of the market share in 2022. The extensive adoption of diesel-powered buses is driving the growth of the diesel fuel segment within the market. Due to their established infrastructure, affordability, and operational efficiency, diesel-fueled buses are extensively utilized by transit agencies globally. The vast existing fleet and industry familiarity with diesel technology make it a preferred choice.
Based on seating capacity, the 40-70 seats segment accounted for 55% of the transit bus market share in 2022, owing to the increasing introduction of 40-seater transit buses. 40-70-seater buses meet the demand for medium-capacity transport, offering a balance between passenger capacity and maneuverability. For instance, in October 2023, the Transport Minister of Karnataka, India, inaugurated 40 non-AC sleeper buses, hundred Karnataka non-AC buses, and new point-to-point buses. This initiative is a key component of the Karnataka State Road Transport Corporation’s strategy to introduce more 798 new buses in 2023.
Asia Pacific transit bus market recorded more than 65% of the revenue share in 2022, attributed to the increasing environmental consciousness and efforts to reduce pollution. With a focus on sustainable transportation, the demand for electric & hybrid buses has surged. Government incentives and policies supporting eco-friendly public transportation have encouraged the adoption of cleaner technologies. As a result, transit agencies and operators are investing in environment-friendly buses, leading to market expansion and a greener future for public transportation in China.
The major companies operating in the transit bus industry are:
AB Volvo, and NFI Group are the major companies operating in the market. These major companies are engaged in various inorganic growth strategies such as merger, acquisitions, partnerships and collaborate closely with governments to secure contracts and navigate regulations. They also invest in electric bus infrastructure, forging partnerships to develop charging stations, ensuring seamless adoption of eco-friendly technologies, and strengthening their market position.
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Market, By Fuel Type
Market, By Application
Market, By Seating Capacity
The above information has been provided for the following regions and countries: