New Flyer Industries Inc., through one of its U.S. subsidiaries, has acquired 100% of the equity interests in Middlebury, IN-based ARBOC Specialty Vehicles LLC for a cash price of $95 million. NFI Group, the largest transit bus and motor coach manufacturer and parts distributor in North America, said the acquisition represents a continuation of the group's growth strategy.
Established in 2008, ARBOC is a North American pioneer in low-floor body-on-chassis, or “cutaway,” bus technology. These buses range between 21 and 35 feet in length, and operate in transit, paratransit and shuttle applications.
“The acquisition of ARBOC provides us with complementary product lines and a unique opportunity to continue with growth and diversification, as NFI Group now has a full suite of transit buses and motor coaches to offer to North American public transit agencies and private operators,” said Paul Soubry, NFI Group’s President and CEO. “ARBOC is a proven low-floor cutaway builder and provides us with an entry point into both the cutaway and medium-duty transit bus markets, with high quality, proven and competitively priced products.”
The North American cutaway bus market has an estimated annual volume of between 16,000 to 18,000 units, which is more than three times the current estimated size of the heavy-duty transit bus market, and more than six times the current estimated motor coach market, based on annual units produced, according to NFI Group. Today, the installed base of cutaway buses is predominantly high-floor in configuration, with low-floor buses comprising less than 5% of the total cutaway market.
ARBOC is the leader in the low-floor cutaway bus market having delivered more than 2,500 buses, or more than 70% of the estimated total low-floor cutaways sold in Canada and the U.S. over the past five years. As the U.S. population ages and ease of access becomes more of a focus, NFI Group management believes ARBOC is ideally positioned to grow with the demand for low-floor cutaway and medium buses with greater accessibility, following the migration that occurred in heavy-duty transit space.
In addition to its cutaway bus product portfolio, ARBOC has introduced a medium-duty low-floor transit and shuttle bus based on ARBOC’s own chassis design. The bus has received favorable market response and ARBOC has already received initial firm orders for deliveries in 2018, the company noted.
Management expects ARBOC will deliver approximately 500 buses in 2018, representing significant growth over 2017. ARBOC’s current firm backlog for 2018 includes over 320 orders.
ARBOC employs approximately 100 people from a 112,000 square foot facility. The company has expertise with diesel and natural gas propulsion based on General Motors, Chrysler, Ford and Freightliner chassis, and will benefit from NFI Group’s expertise in battery electric propulsion and its beginning development of autonomous drive features from its Vehicle Innovation Center (VIC) in Anniston, AL.
ARBOC management team will remain in place, NFI Group reports. “We are excited to continue ARBOC’s growth trajectory under the New Flyer umbrella,” President and CEO Don Roberts said. “We believe that this transaction is the right step for ARBOC to continue offering our customers innovative and superior quality products.”