Electric Bus Market: Analysis, Growth & Trends

Electric Bus Market

The global Electric Bus Market size is expected to grow from approximately 112,041 units in 2022 to reach 671,285 units by 2027, at a CAGR of 43.1%.

Factors such as a rise in pollution and environmental hazards, stringent government regulations, and stiff competition have compelled automotive OEMs to make fuel-efficient and environment-friendly vehicles. Continuous depletion of fossil fuels across the globe and rising concerns over global warming have compelled OEMs to design and develop electric public transport solutions.

The global electric bus market is dominated by major players such as BYD (China), Yutong (China), Proterra (US), VDL Groep (Netherlands), CAF (Solaris) (Spain), and AB Volvo (Sweden). 

The electric bus market in the Asia Pacific is driven by the need to reduce urban pollution and dependency on fossil fuels coupled with growing initiatives by national governments toward clean public transportation. Chinese companies such as BYD, Yutong, Ankai, and Zhongtong are dominating the Chinese as well as global electric bus markets. These players have managed to develop and provide a wide range of electric bus models at lower prices due to the availability of parts and components at cheaper rates. In November 2021, BYD received its first order from TMB (Transportes Metropolitanos de Barcelona) for 25 new-generation 40-foot BYD electric buses, which are expected between 2022 and 2024. This order is part of the initiative to eliminate pollution-causing diesel buses in Barcelona by 2025. The Chinese government has invested heavily in changing the conventional public transport fleet to electric. As a result, the country is dominating the market, ahead of European and American countries. The Asia Pacific leads the electric bus market due to the high adoption rate of electric buses in China. Other Asian countries have also started introducing electric buses in their public transportation fleets.

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Europe is home to many globally renowned electric bus OEMs such as VDL Groep, AB Volvo, Daimler AG, and Solaris. The automotive industry is one of the key contributors to Europe’s economy. The European region has been segmented into Germany, France, Spain, Austria, the Netherlands, Norway, Belgium, Sweden, the UK, Turkey, and Switzerland. Europe presents a big growth opportunity for the electric bus market as the regulations related to environmental issues have become stringent. These changes are propelling the market to test and develop advanced buses and coaches, which will further boost the electric bus market. Government initiatives for the electrification of the public transport fleet and well-established charging infrastructure are driving the electric bus market in these countries. France and Germany, too, are promising markets for electric buses as the governments in both countries are focusing on adopting electric buses for public transport fleets.

The North American automotive industry is one of the most advanced automotive industries in the world. North America is home to major bus and coach manufacturers and a key region for innovations, cutting-edge R&D, and technological advancements in electric buses. The US, which has traditionally been a global technological leader, is the largest electric bus market in North America, followed by Canada. The US has been a pioneer in the development of electric passenger cars, and OEMs are now looking to offer electric buses for different applications such as public transport, airports, schools, corporate, and tours & travel. Government support through incentives and tax benefits, the presence of individual investors, and technological edge are driving the North American electric bus market.

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Latin American public transport is evolving with increasing urbanization. Latin America has one of the highest ratios of people opting for buses as public transport. The region has been segmented into Argentina, Brazil, Chile, and Mexico. Across Latin America, city officials and transit agencies are increasingly adopting electric buses to help improve air quality, reduce fuel costs, and curtail rising greenhouse gas emissions. As the battery prices decline globally and as cities and national governments adopt climate change policies, the roll-out of electric buses is witnessing an increase in Argentina, Brazil, Chile, and Mexico. The Chilean government is planning to fully electrify the nationwide transportation system by 2040. For instance, the Chilean public transport system added 150 new electric buses built by BYD into the RED system in 2020. As of October 2021, with 386 pure electric buses in Chile, BYD accounts for an approximately 74% share of Chile’s electric bus market.

The Middle East & Africa is one of the important regions in the electric bus market. The region has some key economies, such as Egypt, South Africa, and the UAE. The electric bus market in the Middle East & Africa is not as evolved as in other regions. However, with Chinese OEMs expanding across the world, the Middle East & Africa is also expected to have a considerable market share in the future. World Bank data shows that the Middle East & Africa is struggling with the high air pollution that is hindering their sustainable growth potential. To make changes for cleaner environmental conditions, the adoption of an electric bus transportation system is imperative.

Recent Developments:

  1. In April 2021, VDL has announced a supply contract of 32 electric buses to public transport company Hermes in Eindhoven. These buses will be operational from January 2022 in the Eindhoven cityscape.
  2. In February 2021, The Montgomery County Public Schools (MCPS) Board of Education approved a contract with Highland Electric Transportation. Highland Electric Transportation to deploy 326 Thomas Built electric school buses powered by Proterra.
  3. In February 2021, Nova Bus, a subsidiary of Volvo Buses have announced a supply order from Chicago Transit Authority. The order is for 600 new 40-foot electric buses from Nova Bus.
  4. In January 2021, BYD won a supply contract by the Bogota City Public Transport Authority in Columbia to deliver 1,002 electric buses in 2021. This is the largest pure-electric bus contract for BYD outside China. BYD has collaborated with local bus manufacturers namely Superpolo and BUSSCAR for the bus body parts.
  5.  In January 2021, Switzerland approved a project planning for the electrification of two lines in Switzerland. Such continuous emphasis on the electrification of fleets is expected to boost the electric bus market in the country
  6. In September 2020, Yutong presented to global travellers its 5G-enabled Intelligent mobility solution in a live show in China. Autonomous driving buses, intelligent bus stops, and unmanned intelligent bus terminals were showcased.

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