LATAM Bus Industry, Forecast to 2030

Sustainability Targets in Municipalities and Electromobility Laws Fuel the Shift Toward Alternative Powertrain Buses

The overall commercial vehicle volume in LATAM, including 6 countries Brazil, Mexico, Argentina, Chile, Colombia, and Peru, is expected to reach 50,540 units by 2030, growing at a CAGR of 7.7% between 2021 and 2030. Fleet renewal and electromobility laws will drive growth in the coming decade.

There has been a revival in passenger transportation following the lifting of COVID-19-induced movement restrictions. Implementing stricter emission regulations across countries in the region in the next few years will enable fleet operators to replace older fleets with clean buses, including NG and battery electric vehicles. The choice of alternative powertrains varies across countries, depending on their oil imports, natural gas reserves, established funding and bus operation models, electromobility laws, and focus on hydrogen.

Brazil and Mexico contribute to 71.1% of the region’s CV volumes. Most countries in the region focus on renewable energy sources for an energy transition from fossil fuels and an electromobility strategy in place to drive the growth of alternative powertrain vehicles. Chinese companies have an early-mover advantage in the electrification of public transportation in Latin America.

The top 3 OEMs in the medium and heavy-duty bus segments-Daimler, Traton (MAN & Scania), and Scania-take the contribution of European OEMs to more than three-fourths of the bus market in the region.

Chinese OEMs, such as Foton, Zhongtong, Yutong, Kinglong, and BYD, establishing their presence in the region, are expected to compete aggressively with European OEMs in the medium term.

Major cities in Latin America aim to replace public passenger transport fleets with EVs. The separation of asset ownership and operation (e.g., battery, bodywork, electric bus, maintenance) and other financing models (e.g., leasing) will be necessary to renew urban transportation buses. The growing ecosystem of truck OEMs, bodybuilders, and fleets that cater to this demand will positively impact allied sectors.