U.S. Electric Bus Market

The U.S. electric bus market is expected to see substantial growth in the coming years as electric vehicles gain more traction in the transportation industry. Electric buses have numerous benefits, including lower operating costs, reduced emissions, and improved rider experience. In this article, we will analyze the current state of the U.S. electric bus market, identify the major trends and drivers, highlight the key players, and explore the opportunities and threats in the industry.

Market Size and Market Share:

The U.S. electric bus market size was valued at $1.6 billion in 2020 and is expected to grow at a compound annual growth rate (CAGR) of +8% from 2021 to 2028.

The market growth is driven by the increasing demand for clean energy and the growing focus on reducing carbon emissions in the transportation industry.

Key Players in the Industry:

• Proterra Inc.
• BYD Motors Inc.
• NFI Group Inc.
• GreenPower Motor Company Inc.
• Blue Bird Corporation
• GILLIG LLC
• Daimler AG
• REV Group Inc.
• The Lion Electric Co.
• and AB Volvo.

Segmentation:

By Vehicle Outlook

• Battery Electric Vehicle

• Plug-in Hybrid Electric Vehicle

• Fuel Cell Electric Vehicle

By Battery Outlook

• Lithium Nickel Manganese Cobalt Oxide

• Lithium Iron Phosphate

By Application Outlook 

• Intercity

• Intracity

By End-use Outlook

• Public

• Private

The U.S. electric bus market is highly competitive and fragmented, with numerous players operating in the market. The major players in the industry are BYD Company Ltd., Proterra Inc., New Flyer of America Inc., and Alexander Dennis Limited. These companies are investing heavily in research and development to introduce new electric bus models that meet the needs of the market.

Major Trends and Drivers Affecting the Industry:

The U.S. electric bus market is driven by several major trends and drivers, including:

1. Government Initiatives: The U.S. government is taking various initiatives to increase the adoption of electric vehicles, including electric buses. For example, the Federal Transit Administration's Low or No-Emission (Low-No) Grant Program provides funding to state and local governments for the purchase of low- or zero-emission buses.

2. Reduced Operating Costs: Electric buses have lower operating costs than traditional diesel buses, as they require less maintenance and fuel costs are lower.

3. Increased Range and Battery Technology: As battery technology improves, the range of electric buses is increasing, making them a more viable option for longer routes.

4. Environmental Concerns: The growing concern for the environment and the need to reduce carbon emissions is driving the adoption of electric buses.

Opportunities and Threats in the Industry:

The U.S. electric bus market presents several opportunities and threats to the players in the industry. The major opportunities in the industry include:

1. Increasing Demand for Electric Buses: As more cities and states focus on reducing carbon emissions, the demand for electric buses is expected to increase.

2. Technological Advancements: The continued advancements in battery technology and charging infrastructure will provide opportunities for the development of new electric bus models.

3. Government Support: Government initiatives such as grants and incentives are providing opportunities for the industry to grow.

The major threats in the industry include:

1. High Costs: The initial cost of purchasing electric buses is higher than that of traditional diesel buses, which may deter some buyers.

2. Infrastructure Challenges: There is a need for adequate charging infrastructure to support the widespread adoption of electric buses.

3. Competition: The U.S. electric bus market is highly competitive, with numerous players vying for market share.

Regulatory and Legal Issues-

The electric bus market in the United States is heavily influenced by federal, state, and local regulations. The Federal Transit Administration (FTA) has established several regulations to promote the use of electric buses. One such regulation is the Low or No Emission Vehicle Program (Low-No Program), which provides funding to transit agencies for the purchase of low or no emission buses. The FTA has also established a rule requiring transit agencies to purchase zero-emission buses by 2029.

On the state level, California has been a leader in promoting the use of electric buses. In 2018, the California Air Resources Board (CARB) adopted a regulation requiring all transit agencies in the state to transition to zero-emission buses by 2040. Other states such as New York, Massachusetts, and Oregon have also adopted similar regulations.

The electric bus market is also affected by legal issues related to intellectual property, safety standards, and labor laws. For instance, electric bus manufacturers need to ensure that their vehicles meet safety standards established by the National Highway Traffic Safety Administration (NHTSA) and the Federal Motor Carrier Safety Administration (FMCSA). Additionally, manufacturers need to comply with labor laws related to working conditions, wages, and benefits.

Target Demographics-

The target demographics of the electric bus market in the United States include transit agencies, schools, universities, and private companies. Transit agencies are the largest consumers of electric buses in the United States, as they are the main providers of public transportation. According to a report by the American Public Transportation Association (APTA), there were approximately 1,000 electric buses in the United States in 2020, and transit agencies accounted for more than 90% of these vehicles.

Schools and universities are also potential customers for electric buses. School districts and universities have been increasingly interested in electric buses due to their low noise levels and zero-emission capabilities. Private companies, particularly those in the tourism industry, are also potential customers for electric buses.

Preferences and Behaviors-

The preferences and behaviors of the target demographics of the electric bus market vary depending on the segment. Transit agencies, for instance, prioritize reliability, performance, and cost when choosing electric buses. According to a report by the International Council on Clean Transportation (ICCT), transit agencies in the United States prefer electric buses with a range of 200 miles or more, as this ensures that the vehicles can complete a full day of service without requiring a recharge.

School districts and universities prioritize safety, comfort, and sustainability when choosing electric buses. Schools and universities prefer buses that are equipped with air conditioning, heating, and other amenities to ensure that students have a comfortable ride. Additionally, schools and universities are interested in electric buses because they can help reduce greenhouse gas emissions and improve air quality around schools.

Private companies prioritize aesthetics, comfort, and entertainment when choosing electric buses. Tour operators, for instance, are interested in electric buses that are equipped with features such as Wi-Fi, USB ports, and audiovisual systems to provide passengers with an enjoyable experience.

Pricing Trends-

The price of electric buses is influenced by several factors, including battery technology, range, size, and capacity. Generally, electric buses are more expensive than traditional diesel buses due to the higher cost of batteries and other components. However, the total cost of ownership of electric buses is typically lower over the long term due to lower fuel and maintenance costs.

According to a report by the International Council on Clean Transportation (ICCT), the average price of a battery electric bus in the United States in 2020 was $849,000. This is higher than the average price of a diesel bus, which is around $500,000. The report also notes that the cost of battery electric buses has been declining in recent years due to improvements in battery technology and increased production volumes.

Pricing Trends Across Different Segments

The pricing of electric buses varies across different segments, including transit agencies, schools, universities, and private companies.

Transit Agencies

Transit agencies are the largest consumers of electric buses in the United States, accounting for more than 90% of all electric buses in the country. The pricing of electric buses for transit agencies depends on several factors, including the size and capacity of the bus, the range of the battery, and the manufacturer.

According to a report by BloombergNEF, the cost of electric buses for transit agencies in the United States ranges from $750,000 to $1.5 million. The report notes that the price of electric buses is expected to continue to decline in the coming years, driven by improvements in battery technology and increased production volumes.

Schools and Universities

Schools and universities are also potential customers for electric buses. The pricing of electric buses for schools and universities depends on factors such as the size and capacity of the bus, the range of the battery, and the amenities included.

According to a report by the National Renewable Energy Laboratory (NREL), the cost of electric school buses in the United States ranges from $300,000 to $400,000. The report notes that the total cost of ownership of electric school buses is typically lower than diesel buses due to lower fuel and maintenance costs.

Private Companies

Private companies, particularly those in the tourism industry, are also potential customers for electric buses. The pricing of electric buses for private companies depends on factors such as the size and capacity of the bus, the range of the battery, and the amenities included.

According to a report by the American Bus Association, the cost of electric buses for private companies in the United States ranges from $500,000 to $1.5 million. The report notes that the total cost of ownership of electric buses is typically lower than diesel buses due to lower fuel and maintenance costs.

Conclusion-

In conclusion, the electric bus market in the United States has been growing in recent years, driven by increasing demand from transit agencies, schools, universities, and private companies. The pricing of electric buses in the United States varies across different segments, with transit agencies being the largest consumers of electric buses. The cost of electric buses is influenced by several factors, including battery technology, range, size, and capacity. However, the total cost of ownership of electric buses is typically lower than diesel buses over the long term. As battery technology continues to improve and production volumes increase, the cost of electric buses is expected to continue to decline in the coming years.