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School Bus Market is Poised to Reach 109,000 Units Globally by 2025, Driven by the Demand for Safe Transport of Children; Supporting Telematics Services will also see a Surge in Adoption
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The demand for school buses globally is expected to grow steadily despite rising oil and commodity prices. Total school bus shipments, estimated at about 92,561 units in 2017, are expected to increase to 109,575 units in 2025, reflecting a compound annual growth rate (CAGR) of 2.1%. North America is the largest contributor to the global school bus market, accounting for a ~48% share in 2017. China and the Middle East are expected to be the fastest growing markets.New environmental and safety regulations expected in the near term will drive market growth in China and the Middle East. Diesel engines will propel a greater number of school buses. Given growing environmental concerns triggered by increasing vehicle emissions, eBus sales will gain momentum by 2020. Battery electric vehicles (BEVs) will have a major share by then, followed by fuel cell electric vehicles (FCEVs) and plug-in hybrid vehicles (PHEVs). However, FCEVs are foreseen as the preferred powertrain in the long term due to their light weight and almost twice the efficiency of traditional internal combustion engines (ICEs). Electrification of school buses will be more prominent in North America and China when compared to other regions of the world and will contribute a sizable portion of the overall school bus sales by 2025. Medium Duty (MD) buses account for about 56% of the total school bus industry volume, followed by Light Duty (LD) buses (~37%) and Heavy Duty (HD) (~7%) buses. Most MD buses are 9 m and 10 m in length, and are preferred owing to their larger seating capacities and operational efficiency. Rising safety standards and increasing vehicular traffic will lead to higher occupancy rates in school buses. School bus safety standards in North America are more advanced than those for any passenger carriers worldwide. Enabling real-time tracking and advanced connected technologies will ensure that school buses are a preferred mode of transport over economical public transport systems.The key feature differentiating a school bus from other vehicles is the importance given to safety and security of children. North America has comprehensive safety guidelines and regulations, which include school bus design parameters, driver training and monitoring programmes and laws on student protection, all of which have made school buses the safest vehicles on road. Other regions however have a reactive approach to safety and are trying to emulate the North American model. This will be aided by the growth in telematics solutions as well. Strong push by the governments in China, India and the Middle East towards regularising and standardising the school bus will be key to the market growth and to challenge the dominance of North America.Author: Vineeth Purushotham
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