Electric Bus Market Size
Global Electric Bus Market reached USD 53 billion in 2022 and is expected to reach USD 920 billion by 2031, growing with a CAGR of 42.8% during the forecast period 2024-2031. The Global Electric Bus Market has witnessed exponential growth in recent years, driven by a surge in environmental awareness and a growing emphasis on sustainable transportation solutions.
As the world embraces cleaner and greener modes of transport, the electric bus market has emerged as a promising sector with immense potential. One prominent trend in the electric bus market is the increasing adoption of electric buses by public transportation authorities and companies worldwide.
Governments across the globe are prioritizing the reduction of carbon emissions and promoting the use of electric vehicles (EVs) in their public transport fleets. This proactive approach has significantly contributed to the expansion of the electric bus market, as governments incentivize the purchase and deployment of electric buses through grants, subsidies, and favorable regulations.
In Europe, electric buses accounted for approximately 10% of total bus sales in 2022, indicating a significant growth rate. Meanwhile, Asia-Pacific dominates the Global Electric Bus Market, with China leading the way. Chinese cities have made substantial progress in adopting electric buses, driven by ambitious government targets and substantial investments in charging infrastructure. Additionally, in North America, the electric bus market is gaining momentum, with government initiatives aimed at replacing diesel-powered buses with electric alternatives.
Market Summary
| Metrics | Details |
| CAGR | 42.8% |
| Size Available for Years | 2022-2031 |
| Forecast Period | 2024-2031 |
| Data Availability | Value (US$) |
| Segments Covered | Propulsion, Bus Length, Vehicle Range, Battery Capacity, Power Output, Battery, Application, End-User and Region |
| Regions Covered | North America, Europe, Asia-Pacific, South America and Middle East & Africa |
| Fastest Growing Region | Asia-Pacific |
| Largest Region | Asia-Pacific |
| Report Insights Covered | Competitive Landscape Analysis, Company Profile Analysis, Market Size, Share, Growth, Demand, Recent Developments, Mergers and Acquisitions, New Product Launches, Growth Strategies, Revenue Analysis, Porter’s Analysis, Pricing Analysis, Regulatory Analysis, Supply-Chain Analysis and Other key Insights. |
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Market Dynamics
Environmental Concerns, Government Initiatives and Advancements in Battery Innovations
One of the primary drivers in the global electric bus market is the increasing concern for environmental sustainability. Governments around the world have recognized the urgent need to reduce greenhouse gas emissions and combat air pollution. As a result, many countries have implemented stringent emission norms and introduced various incentives to promote electric vehicle adoption, including electric buses.
For instance, according to data released by the Chinese government, as of 2020, more than 420,000 electric buses were in operation in the country, accounting for nearly 99% of the global electric bus fleet. The Chinese government's strong push towards electrification through subsidies, favorable policies, and infrastructure development has significantly contributed to the growth of the electric bus market.
Similalry, the rapid advancement of battery technology has been a key driver in the growth of the electric bus market. The increasing energy density and declining costs of lithium-ion batteries have made electric buses more viable and attractive to both manufacturers and consumers. Governments are actively investing in research and development to enhance battery technology, improve charging infrastructure, and extend the range of electric buses.
For instance, the European Union announced a major funding initiative to develop and produce advanced lithium-ion batteries, including those used in electric buses. The aforementioned investment aims to strengthen the European battery industry and accelerate the adoption of electric mobility across the continent.
Public Transport Modernization and Urbanization coupled with Cost Efficiency and Operational Savings
Urbanization and the need for modernization of public transportation systems have played a significant role in driving the demand for electric buses. Growing urban populations and increasing traffic congestion have created a pressing need for sustainable and efficient public transportation solutions. Electric buses offer a clean and reliable alternative to traditional buses, making them an attractive option for cities seeking to improve their transportation networks.
Cities like London, Paris, and New York have launched initiatives to replace their existing diesel-powered bus fleets with electric buses. The aforementioned initiatives are driven by environmental concerns and the need to enhance the quality of public transportation services, reduce noise pollution, and create a more sustainable urban environment.
Further, despite electric buses having a higher upfront cost compared to their conventional counterparts, they offer significant savings in operational expenses over their lifetime. Electric buses have lower maintenance and fuel costs, as they rely on electricity instead of fossil fuels. Governments and fleet operators are recognizing these long-term cost benefits, leading to increased adoption of electric buses.
For example, the government of India launched the "Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles" (FAME) program, providing financial incentives to promote electric mobility, including electric buses. Therefore, public transport modernization and urbanization, coupled with cost efficiency and operational savings could be recognized a major market driver offering electric bus market opportunities and demand growth.
Range Anxiety and Problems Associated with Relibility and Maintenance
Range anxiety refers to the fear of running out of battery power before reaching the destination. Despite improvements in battery technology, electric buses still have a limited range compared to their conventional counterparts. The respective limitation restricts their operational capabilities, especially for long-distance routes or routes with limited charging infrastructure.
Data indicates that electric buses generally have a shorter range compared to diesel or natural gas buses, which poses a challenge for transit authorities in planning their routes. Further, electric buses require complex electrical systems and battery management, which can be prone to technical glitches and failures.
The lack of trained technicians and specialized maintenance facilities for electric buses further adds to the challenge. Moreover, the high costs associated with battery replacement and maintenance contribute to apprehension among fleet operators. Thus, range anxiety and problems associated with reliability and maintenance hamper the electric bus market’s growth.
Market Segmentation Analysis
The Global Electric Bus Market is segmented based on propulsion, bus length, vehicle range, battery capacity, power output, battery, application, end-user and region.
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In recent years, the Global Electric Bus market has witnessed a significant shift toward Battery Electric Vehicles (BEVs) dominance. With governments actively supporting the transition to electric transportation and the growing focus on sustainability, the dominance of BEVs in the global electric bus market is evident occupying almost 2/3rd of the market shares.
For instance, in China, the largest electric bus market globally, the government has actively supported the deployment of electric buses to combat air pollution and reduce dependency on fossil fuels. According to the latest data from the Ministry of Transport, in 2022, the number of electric buses in China exceeded 600,000, with over 80% being BEVs.
Similarly, several European countries have implemented ambitious plans to transition their public transportation systems to electric buses. The Netherlands, for instance, aims to have a fully electric bus fleet by 2025. According to data provided by the Dutch government's National Emission Register, as of 2022, BEVs accounted for over 90% of the electric buses in operation.
In short, as the world continues to prioritize environmental consciousness and reducing carbon emissions, the dominance of BEVs in the electric bus segment is expected to persist and drive the future of sustainable public transportation.
Market Geographical Share
Transition toward sustainable transportation, continuous stream of new product launches and Technological advancements
The Asia-Pacific has emerged as a dominant force in the Global Electric Bus Market, spearheading the transition toward sustainable transportation. According to Asia-Pacific Economic Cooperation (APEC) Energy Working Group, the region accounted for approximately 75% of the global electric bus fleet in 2022.
China, in particular, has played a pivotal role, with its government actively promoting electric mobility. As of 2021, China boasted the largest electric bus fleet in the world, surpassing 420,000 vehicles, as the Ministry of Transport of the People's Republic of China reported. South Korea, India, and Singapore have likewise experienced notable expansion, propelled by supportive government policies and investment in electric infrastructure.
Asia-Pacific's dominance in the Global Electric Bus Market is further exemplified by the continuous stream of new product launches and advancements in the region. Governments across the region have encouraged local manufacturers to develop cutting-edge electric bus technologies, contributing to their leadership position. In China, for instance, leading electric bus manufacturers such as BYD, Yutong, and Zhongtong have introduced a range of innovative models.
For example, BYD launched its K12A electric bus, featuring industry-leading battery technology and extended range capabilities. In short, from China's massive electric bus fleet to Japan's technological advancements and India's ambitious plans, the region showcases a strong commitment to sustainable transportation thus indicating extensive electric bus market opportunities and share growth.
Electric Bus Companies
The major global players include BYD, YUTONG, PROTERRA, VDL GROEP, AB VOLVO, DAIMLER AG, NFI GROUP, CAF, EBUSCO BV, KING LONG and KARSAN.
COVID-19 Impact on Market
The COVID-19 pandemic has caused significant disruptions across various industries. As countries globally grappled with the challenges brought forth by the virus, the transportation sector experienced a profound impact. While the initial stages of the pandemic led to disruptions in manufacturing and supply chains, governments globally responded with supportive policies, subsidies, and investments in research and development.
Statistics reveal that the electric bus manufacturing sector witnessed a sharp decline in production during the initial stages of the pandemic. Lockdown measures, labor shortages, and restrictions on international trade disrupted supply chains, leading to a decrease in bus production and delayed deliveries.
However, many governments recognized the need to stimulate economic recovery and promote sustainable transportation post-COVID-19. As a result, several countries introduced or expanded existing policies and subsidies to incentivize the adoption of electric buses. Governments allocated funds towards the procurement of electric buses, offering financial support to transit agencies and operators. Thus, as the world strives for a sustainable future, the electric bus market is poised for continued growth in the post-pandemic era.
AI Impact
Artificial Intelligence (AI) has emerged as a game-changer across various industries, and the global electric bus market is no exception. AI technology is revolutionizing the way electric buses are designed, manufactured, and operated, leading to significant advancements in efficiency, safety, and sustainability.
According to the International Energy Agency (IEA), the number of electric buses globally reached approximately 460,000 units in 2020, representing a remarkable increase of 32% compared to the previous year. The surge can be attributed, in part, to the integration of AI technology into electric bus systems, resulting in improved performance and increased adoption.
Moreover, several manufacturers have integrated AI technology into their electric bus designs to optimize performance. For instance, Proterra, a leading electric bus manufacturer based in the United States, introduced its Catalyst E2 electric bus, equipped with an AI-powered battery management system.
The system leverages machine learning algorithms to monitor and analyze battery performance, resulting in extended range, enhanced battery life, and improved overall efficiency. Thus, as AI continues to advance, its integration into the electric bus market is expected to drive further innovation. By leveraging AI technology, electric buses can become even more intelligent, efficient, and environmentally friendly.
Russia-Ukraine War Impact
The Russia-Ukraine war has had a profound impact on the global electric bus market. The war has led to significant disruptions in the supply chain, particularly in the sourcing of critical components used in electric buses. Ukraine has been a major supplier of key materials such as lithium, cobalt, and rare earth elements, which are vital for the production of lithium-ion batteries.
With the conflict disrupting trade routes and creating uncertainties, the availability and pricing of these materials have been severely impacted, leading to challenges for electric bus manufacturers globally. Further, the conflict has also resulted in strained diplomatic relations and economic sanctions between Russia and several countries, affecting international trade. As a result, the global electric bus market has experienced a slowdown in exports and imports.
In addition to international ramifications, the Russia-Ukraine war has also influenced the electric bus markets within both countries. With resources and attention diverted to the conflict, domestic electric bus deployment initiatives have faced delays or even cancellations. Further, the increased costs associated with the Russia-Ukraine conflict have put upward pressure on electric bus prices. Manufacturers, facing higher material costs and limited supply, have had to pass these expenses on to customers, making electric buses less affordable and potentially slowing down their market penetration.
Key Developments
- Chinese electric vehicle manufacturer BYD launched its latest electric bus model, the K12A, in 2022. The K12A boasts an impressive range of 300 miles on a single charge and is equipped with advanced safety features and passenger amenities. The respective product launch further strengthened BYD's position as a leading player in the electric bus market.
- American electric bus manufacturer Proterra introduced its next-generation electric bus, the ZX5, in 2022. The ZX5 offers an extended range of up to 330 miles and features high-performance drivetrain technology. The product above launch showcases Proterra's commitment to pushing the boundaries of electric bus innovation.
- Swedish manufacturer Volvo unveiled its new electric bus, the Volvo 7900 Electric Articulated, in 2022. The aforementioned electric articulated bus is designed to meet high capacity demands.
Why Purchase the Report?
- To visualize the global electric bus market segmentation based on propulsion, bus length, vehicle range, battery capacity, power output, battery, application, end-user and region, as well as understand key commercial assets and players.
- Identify commercial opportunities by analyzing trends and co-development.
- Excel data sheet with numerous electric bus market-level data points with all segments.
- PDF report consists of a comprehensive analysis after exhaustive qualitative interviews and an in-depth study.
- Product mapping available as Excel consisting of key products of all the major players.
The Global Electric Bus Market Report Would Provide Approximately 103 Tables, 103 Figures And 226 Pages.
Target Audience 2024
- Manufacturers/ Buyers
- Industry Investors/Investment Bankers
- Research Professionals
- Emerging Companies
