Europe, North America, and India Will Experience a Resurgence of the Industry
Emission regulations, battery price drop, the emergence of low emission zones, purchase subsidy, and tax exemptions will drive electric bus growth across the world. The growing adoption of electric transit buses has opened the path for global sourcing and supply of alternate powertrain buses. The industry is fertile ground for strong collaborations among incumbent automakers, suppliers, and new players striving to enter the market. By 2023, battery-electric (BEV) buses will attain a larger market share followed by fuel-cell electric buses. The lower total cost of ownership of electric buses in comparison to diesel buses and the push for developing charging infrastructure will make electric buses a profitable option from 2024 to 2026.
The global electric bus market size will reach more than 160,000 units by 2030 at a compound annual growth rate (CAGR) of 12.6%.
EU Clean Vehicle directive targets for EU countries will boost electric bus adoption, particularly as part of national public transport procurement. BEV buses will experience strong growth from 2022 to 2025. Joint Initiative for Hydrogen Vehicles across Europe (JIVE) projects will encourage fuel cell bus adoption across EU countries. The entry of utility and energy major companies into electric charging infrastructure will boost the growth of fueling infrastructure for electric vehicles.
In China, BEV buses will see moderate growth from 2022 to 2025 due to the elimination of subsidies and purchase incentives. The revised subsidy program in China incorporates stricter thresholds for electric range and energy efficiencies as the minimum requirement for qualification. However, lower battery prices and charging infrastructure will drive higher electric bus adoption toward 2030. In addition, Chinese electric bus OEMs are rapidly expanding globally, with the establishment of manufacturing and assembly plants, in addition to exports.
Zero-emission Bus Rapid-Deployment Accelerator (ZEBRA) will drive electric bus adoption in Latin America with initial kickstarts in Medellin, São Paulo, and Mexico City. Major LATAM countries are developing an electromobility strategy promoting zero-emission buses in public transportation, and Chinese OEMs have established regional production bases to tap into LATAM.
The increasing need to reduce emissions, especially in highly populated cities, will require a greater adoption of electric buses in the intra-city passenger transport segment. Growing battery capacities and aggressive development in charging infrastructure technologies will help in that sense, increasing the adoption rate of electric powertrains in the coaches segment, albeit with stiff competition from diesel and natural gas buses.
