North America Bus Market Size, Share & Trends Analysis Report By Type (Single Deck, Double Deck), By Fuel Type, By Seat Capacity, By Application and Segment Forecasts, 2024 - 2030

North America Bus Market Size & Trends

The North America bus market size was estimated at USD 6.64 billion in 2023 and is expected to grow at a CAGR of 10.8% from 2024 to 2030. Factors such as advancement in the public transportation industry and the expansion & revamping of American and Canadian road networks are driving the market growth. The use of electric buses for long-distance intercity travel and school commuting is expected to increase the use of buses, which results in fueling the demand for electric and non-electric buses in North America. To address the problem of rising environmental pollution brought on by travel and transportation, the federal government is offering funding & incentives for electric vehicles to replace fossil fuel-based buses. The support from the government in the form of incentives is also encouraging OEMs to manufacture and launch electric buses in the market.

Growing concerns regarding the increased concentration of greenhouse gases and pollution levels are encouraging American and Canadian government organizations to undertake several initiatives to reduce carbon emission levels. One such initiative includes electrifying the public transport fleet by procuring electric buses through bus manufacturers. For instance, in May 2023, the Canadian government announced the procurement of 1,299 electric buses to enhance the public transportation network in the eastern province of Quebec, Canada. Additionally, Canada's Federal, and provincial government is said to invest USD 585 million and USD 823.2 million, respectively, to purchase 1,229 electric buses for Quebec.

Moreover, the ongoing transition from conventional buses to battery-powered and hydrogen-fuel-powered buses are driving the demand for the North America bus market. The U.S. Federal government, schools, automobile manufacturers & suppliers, and regional public transport providers to install efficient charging infrastructure are partnering to reduce the challenge faced by the fleet operators in the electric bus market. They are working on the development of battery charging infrastructure and hydrogen fuel stations in the region. For instance, in April 2023, BorgWarner Inc., an automotive supplier, announced its partnership with Pontiac City School District, Michigan, for providing proprietary charging with direct current fast chargers, enabling vehicle-to-grid charging for 25 IC electric buses.

Companies in the market are enhancing their offerings with features such as Wi-Fi, communication systems, and Advanced Driver Assistance Systems (ADAS) to elevate the travel experience and ensure passenger safety. For instance, in April 2023, Scania AB introduced an electric bus in Mexico equipped with ten batteries totaling 330 kWh, providing a range of 300 km. It also features a 2-speed transmission for efficient battery management, regenerative braking, a power output of 230 kW, and 1,800 Nm of torque. Furthermore, the bus incorporates an ADAS system for alerting the driver to nearby people and objects, along with an Acoustic Vehicle Alerting System (AVAS) to further enhance safety and comfort for passengers.

Moreover, prominent players in the North America Bus Market investing in developing low-emission diesel engines. These engines are integrated with clean diesel technology, require less fuel, and have lower operating costs, thereby buses integrated with clean diesel engine technology are widely used for transit buses. For instance, in April 2023, New Flyer, a subsidiary of NFI Group Inc., announced that they had received the order for an additional 116 Xcelsior heavy-duty transit buses on behalf of the New York City Transit Authority. The Xcelsior buses are equipped with a diesel engine that complies with the Heavy-Duty National Program standards set by the United States Environmental Protection Agency (EPA) and the National Highway Traffic Safety Administration (NHTSA). This engine features ultra-low-sulfur diesel fuel and emits 95% fewer nitrogen oxides compared than regular engine emissions.

Market Concentration & Characteristics

The market growth stage is high, and the pace of market growth is accelerating. This growth is primarily attributed to the growing emphasis on safe and comfortable travel, which is expected to encourage further technological developments. Furthermore, the North American bus market is driven by modern technologies and concepts such as IoT connectivity, real-time tracking, and advanced braking systems, which would expect that automobile manufactures would achieve de-carbonization targets in the future.

Continuous advances in technology, such as advanced braking systems, Automatic Vehicle Location and Control (AVLC), big data, electromagnetism, and low-pollution engines, have made buses safer and more environmentally friendly. Prominent players in the market are focusing on replacing the existing diesel fleet with technologically advanced electric fleets.

Customers prefer purchasing buses or vehicles from manufacturers who provide additional services such as vehicle financing, maintenance, leasing, and rental. End-users are investing aggressively in bus electrification due to the strong emphasis on obtaining actionable insights to increase market revenue.

Governments in the North American region are making huge investments to bolster the electrification and green bus goals of public transportation and school bus operators. For instance, in October 2022, the Canadian government invested USD 14.9 billion in green public transportation. This funding includes USD 3 billion in annual federal public transit funding, which is reliable, permanent, and accessible to support transit solutions from 2026 to 2027.

There are no direct substitutes present in the market. In addition, customers are still inclined toward conventional vehicles due to significantly lower purchase prices and better-established vehicle infrastructure. However, with government policies for adopting green vehicles and increasing investments in the development of EV infrastructure, the threat of substitutes is expected to reduce significantly from 2023 to 2030.

Type Insights

The single deck segment accounted for the largest market share of over 92% in 2023and is expected to exhibit the fastest growth rate over the forecast. The aggressive investments being made across the U.S. and Canada to enhance the road transportation network have increased the accessibility of single-deck buses for interstate travel for passengers. Several city administrations are pursuing plans to convert their entire bus fleets to all-electric vehicles. For instance, the Metropolitan Transportation Authority (MTA) is contemplating replacing its entire bus fleet with zero-emission vehicles by 2040.

Many cities are pursuing plans to convert their public transport fleets to electric bus fleets. For instance, the Metropolitan Transportation Authority is planning to convert its ICE buses to a zero- emission buses by 2040. Similarly, in January 2023, Federal Transit Administration (FTA) U.S. announced funding worth approximately USD 1.7 Million for state authorities to upgrade or purchase buses and improve bus facilities. Such initiatives encourage manufacturers to produce single-deck electric buses, thereby opening new opportunities for market growth.

Fuel Type Insights

The diesel segment accounted for the largest market share of more than 74% in 2023. Diesel tends to be cheaper as compared to other vehicle fuels. Hence, diesel-fired buses are preferred due to their lower operating costs. Diesel engines are also considered rigid and safe. Hence, diesel engine power accounts for 95% of all school buses in North America. Among these, the cleanest, emission-free diesel engine technology is used by 58% of consumers.

While most schools are being encouraged to utilize blends of high-quality biodiesel and renewable fuel to power their school buses, and several schemes are also being launched to encourage the electrification of buses, the high initial costs and investments are compelling local agencies to continue using diesel buses.

The electric and hybrid segment is anticipated to register the highest growth over the forecast period. The growth of the segment can be attributed to the continued electrification of public fleets and the aggressive adoption of hybrid buses by public fleet operators in the U.S. A myriad of incentives, subsidiaries, and rebates are being offered to electrify the existing bus fleet. For instance, the City of Jonesboro in the U.S. state of Arkansas received funding worth USD 878,584 to buy hybrid buses. These buses would replace older diesel buses and subsequently help in improving air quality throughout the city.

Seat Capacity Insights

The 31 - 50 seats segment accounted for the largest market share of more than 50% in 2023 and is expected to exhibit the fastest growth rate from 2024 to 2030. Buses with a capacity of 30-50 seats are utilized for scheduled travel, tourism, and student transportation. Traffic congestion particularly makes these buses an ideal alternative for public transport. Electrification is also emerging as a popular trend, particularly when it comes to buses with a capacity of 30-50 seats. Several initiatives are being pursued to curb pollution and protect school-going children from vehicular pollution. For instance, the U.S. government’s Clean School Bus program envisages the U.S. Environmental Protection Agency (EPA) covering up to 100% of the cost of replacing incumbent school buses with zero-emission school buses, including the cost of vehicles and the charging infrastructure. OEMs are particularly focusing on the 30-50-seater variants, typically by integrating low emission technologies or improving the range of electric buses by adding extra battery packs.

The more than 50-seat segment is anticipated to register considerable growth over the forecast period. The growing preference for bus rapid transit systems, in line with the unabated increase in urban population, which is expected to drive the growth of the segment. Bus rapid transit systems combine the speed and capacity of metro services to offer affordable and flexible commutes. Buses with more than 50 seats are used for tourism purposes, especially for long travels, sightseeing, and pick-and-drop schedules during long-distance travel.

Application Insights

The school segment accounted for the largest market share of over 79% of the overall market in 2023. Factors such as refurbishment and replacing existing fossil fuel-powered bus fleets with electric ones are expected to support the segment growth over the forecast period. Schools in various U.S. states, including Illinois, New York, Virginia, Florida, and California, are committed to increasing the use of electric school buses. California is already leading the way in the adoption of electric school buses by deploying over 1,000 electric school buses across the state. Similarly, in April 2022, New York Governor Kathy Hochul reached an agreement on a USD 220 billion state budget with legislators, which includes the goal of having around 50,000 of the state's school buses run on electricity by 2035.

Transit buses are emerging as the preferred choice for long-distance commuters, who are increasingly relying on these buses to meet their transportation needs. The bus ridership is typically growing in the U.S., especially in the federal district of Washington DC and the state of New York, among other areas. For instance, bus ridership in New York City increased by 9.9% over the year to USD 312 million in 2021. Washington DC has enacted the zero-fare bus bill into law and eliminated the USD 2 fare for all the city buses. Such initiatives are propelling the growth of the transit buses segment.

Country Insights

U.S. Bus Market Trends

Bus market in the U.S. accounted for the largest market share of over 88% in 2023. The growing traction of buses in the U.S. is attributed to the revamping of highway infrastructure throughout the country, the electrification of public transit bus fleets by the different state governments, growing investment towards bus charging infrastructure, the development of electric bus fleets by private transit service operators and aggressive investment by the school and federal government to electrify school buses fleet with the country. The electrification efforts, coupled with technological development in diesel engines, electric motors, and hydrogen fuel cell technology, are expected to augment the market growth.

Canada Bus Market Trends

Canada bus market is expected to grow at the fastest CAGR over the forecast period.Canada is also undertaking initiatives for the deployment of electric buses in the country. For instance, in January 2023, the mayor of Ottawa announced USD 350 million in federal funding to purchase 350 electric buses and install the charging infrastructure for the bus fleet in Ottawa. The region is also witnessing a trend of private transit entities in Canada electrifying their vehicle fleets in association with major bus manufacturers present in Canada, which is further driving the market growth.

Key North America Bus Company Insights

Some of the key companies operating in the North America bus market include Blue Bird Corporation, NFI Group, Daimler AG, Navistar Inc., and AB Volvo.

• NFI Group operates through its subsidiaries, which have an exhaustive line of electric and ICE fuel-based buses. In North America, the company operates in the U.S. and Canada, supplying buses to transit authorities across the region. Like other manufacturers, it follows an electrification trend; therefore, it collaborates with prominent bus manufacturers, such as BYD, to leverage their expertise and technologies. The company is actively undertaking product enhancements and conducting trials for autonomous buses.

• Navistar Inc. has a strong presence in North America and Canada and has established a strong distribution and services network in the region. To maintain a strong presence in the local community, the manufacturer actively organizes training programs for its dealers and provides scholarships for education. IC Bus, the company’s subsidiary, launched electric buses and collaborated with charging service and infrastructure providers.

Man Se, BYD Company Limited, Iveco SpA, and Anhui Ankai Automobile Co., Ltd. are some of the emerging companies in the market.

• Iveco SpA is engaged in producing, financing, selling, and marketing commercial vehicles, buses, trucks, and specialty vehicles for defense and firefighting, among other applications. The company markets its products under IVECO, IVECO Bus, Nikola, Astra, and Magirus brands. Under IVECO Bus brand, the company manufactures commuter and city buses. The buses manufactured by the company are used for intercity, intracity, and tourism purposes. In North America, the company has marked its presence in the U.S., Canada, and Mexico.

• Anhui Ankai Automobile Co., Ltd. manufactures large and medium-sized lights, high-end buses, and auto parts. The company exports its products to more than eighty countries and regions, including Italy, Saudi Arabia, the U.K., Mexico, France, the U.S., and Australia.

Recent Developments

• In January 2024, BLUE BIRD CORPORATION delivered twenty-three electric school buses to Carter County Schools (CCS) in Kentucky. This marks a new era for the school district, replacing traditional diesel buses with zero-emission alternatives. These buses produce zero tailpipe emissions, significantly contributing to cleaner air for students, communities, and the environment.

• In January 2024, Group Keolis S.A.S. announced two major contracts to operate and maintain bus networks in Phoenix, Arizona, and Austin, Texas. These contracts solidify Keolis's position as a major player in the U.S. public transportation market. They will expand access to reliable and efficient public transportation in both Phoenix and Austin. The use of natural gas and electric buses in these networks demonstrates Keolis's commitment to sustainability.

• In December 2023, BLUE BIRD CORPORATION and Generate Capital, a sustainable investment firm, announced partnership to create Clean Bus Solutions - a joint venture focused on accelerating the adoption of electric school buses in North America. Clean Bus Solutions offers a "fleet electrification-as-a-service" model, making it easier and more affordable for school districts to transition to electric buses.

• In October 2023, NFI Group announced a multi-year agreement with American Battery Solutions (ABS) for the supply of custom battery packs for their electric buses and coaches. The ABS partnership expands NFI's battery supply chain, adding resilience and ensuring they have enough batteries to meet their production targets.

• In July 2023, IC Bus, a subsidiary of NAVISTAR, launched the next generation of its flagship CE Series school bus, 20 years after its initial debut. This new iteration prioritizes efficient operations, improved driver comfort, lower total cost of ownership (TCO), and enhanced safety features.

North America Bus Market Report Scope

North America Bus Market Report Segmentation

This report forecasts revenue growth at region & country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2018 to 2030. For this study, Grand View Research has segmented the North America bus market report based on type, fuel type, seat capacity, application, and country:

• Type Outlook (Revenue, USD Million; Volume, Units, 2018 - 2030)

  • Single Deck

  • Double Deck

• Fuel Type Outlook (Revenue, USD Million; Volume, Units, 2018 - 2030)

  • Diesel

  • Electric and Hybrid

  • Other Fuel Type

• Seat Capacity Outlook (Revenue, USD Million; Volume, Units, 2018 - 2030)

  • 15-30 Seats

  • 31-50 Seats

  • More Than 50 Seats

• Application Outlook (Revenue, USD Million; Volume, Units, 2018 - 2030)

  • Transit

  • School

  • Coach

  • Others

• Country Outlook (Revenue, USD Million; Volume, Units, 2018 - 2030)

  • U.S.

  • Canada

  • Mexico