Demand for buses worldwide will expand 4.2 percent annually to 496,000 units in 2014, reflecting rebounding demand in North America following the 2009 recession as well as sustained sales in many other markets. Beyond North America and Japan, both of which experienced significant declines in demand in 2009, the global economic crisis has not had as negative an impact in many markets. The new sense of frugality taking hold among consumers in many developed markets, coupled with volatile fuel prices, have made bus travel a more attractive option for its cost effectiveness and fuel efficiency. These and other trends are presented in World Buses, a new study from The Freedonia Group, Inc., a Cleveland-based industry market research firm.
Demand for buses tends to be cyclical within markets and depends on region- or country-specific trends, such as demographics, income levels, relative spending on mass transit systems and per capita passenger vehicle density. In North America, efforts by the US government to stimulate the economy are already translating into a rebound from 2009 levels. Canada is likewise focusing billions of dollars on transit infrastructure, with up to one-quarter of this spending historically focused on buses.
Other forces expected to support bus demand include increasing congestion levels in major metropolitan centers worldwide and the establishment of dedicated and sometimes guided “busways” in key cities across Central and South America, Australia, France and the UK.
The bus market in North America is unique in several ways, notably for its use of specially designed school buses. The US also lacks the dynamic passenger train, tram and subway systems so common in Europe and Japan, making bus travel the primary mass transit option in most US cities. New investments in light rail projects in many US states as a result of government stimulus funding could pose competition for bus sales. However, such spending could also stimulate transit bus sales in multi-mode passenger transportation systems. Western Europe and Japan will experience slower growth in bus demand compared to the United States due to stagnant population increases and aging populations, as well as the prevalence of other mass transit options such as rail.
China remains both the largest market for buses and the largest producer, and will be one of the fastest growing bus markets going forward. The country could become a regional hub for bus production, although virtually all of its bus output so far has been focused on satisfying local demand.
World Buses (published 10/2010, 294 pages) is available for $5,900 from The Freedonia Group, Inc., 767 Beta Drive, Cleveland, OH 44143-2326. For further details, e-mail [email protected]. Information may also be obtained through www.freedoniagroup.com.