The global bus market is on a robust growth trajectory, projected to increase by USD 19.07 billion between 2023 and 2028, expanding at a Compound Annual Growth Rate (CAGR) of 6.73%. This growth is largely driven by factors such as accelerated urbanization, heightened government regulations, increasing environmental concerns, and the continuous push for innovative transportation solutions. As the demand for sustainable and efficient urban mobility solutions escalates, the bus industry is poised to meet the needs of an expanding global population, particularly in urban areas.
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One of the primary factors propelling the global bus market is rapid urbanization. Cities are growing at an unprecedented rate, with more than 68% of the world’s population expected to live in urban areas by 2050, according to the United Nations Department of Economic and Social Affairs. This migration to cities creates an increasing need for efficient, accessible, and sustainable transportation systems. In markets like China, India, and the U.S., the demand for buses to meet the transportation needs of densely populated urban areas is surging.
Governments around the world are also playing a pivotal role in shaping the bus market through strategic regulations, policies, and incentives. For example, countries are focusing on adopting electric buses to reduce emissions, promote sustainable public transportation, and alleviate traffic congestion. The introduction of Bus Rapid Transit (BRT) systems, particularly in large cities in Asia and Latin America, further underscores the shift toward more efficient public transportation solutions.
Electric buses are at the forefront of the latest technological advancements in the global bus market. As cities continue to prioritize sustainability, electric buses offer a solution to the increasing demand for clean, eco-friendly transportation. Major players like Volvo, BYD, and Proterra are leading the charge in developing and manufacturing electric buses that cater to both urban transit and long-distance travel. Furthermore, innovations such as the use of solar power to charge lithium-ion batteries, as demonstrated by Uganda’s Kiira Motors with its Kayoola bus, are creating new opportunities for electric bus adoption.
The integration of autonomous driving technology is another game-changer. Volvo, in collaboration with Nanyang Technological University in Singapore, is working on autonomous electric buses as part of a broader initiative to revolutionize public transportation systems worldwide. Such advancements are expected to drive significant market growth during the forecast period, as they promise to reduce operational costs, enhance passenger experience, and contribute to the global sustainability agenda.
While the prospects for the bus market are bright, challenges remain—chief among them is the inadequate bus infrastructure in several regions. In urban areas experiencing rapid growth, the lack of essential infrastructure such as dedicated bus lanes, bus terminals, and sufficient bus stops hinders the operational efficiency of public transportation services.
For instance, in many cities in India, over half of the required bus stops are still missing, creating inefficiencies and delays. This deficiency not only impacts the convenience of passengers but also exacerbates traffic congestion, further complicating the task of improving urban mobility. To overcome these challenges, governments and private sector stakeholders will need to invest in comprehensive urban planning that integrates modern bus infrastructure with existing transportation networks.
The market is segmented into various types of buses, with single-deck buses taking a significant share of the market. These buses are preferred for urban and suburban transport due to their smaller size and maneuverability, making them ideal for navigating crowded city streets and narrow lanes. The rising demand for public transport, government programs to alleviate traffic congestion, and a growing preference for environmentally friendly mobility options are all driving the adoption of single-deck buses.
Electric and hybrid buses are gaining traction, with manufacturers focusing on innovations that enhance energy efficiency and reduce carbon emissions. For example, electric buses powered by advanced lithium-ion batteries are now common in many regions, particularly in North America and Europe, where there is a concerted push for greener transportation solutions.
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The Asia-Pacific (APAC) region is expected to contribute significantly to the growth of the global bus market during the forecast period, accounting for approximately 50% of the market share. China, in particular, is leading the way in adopting electric buses, with more than 40 BRT lines in operation by 2020. These BRT systems have become a vital part of China's strategy to improve public transport while reducing traffic congestion and emissions.
In addition to China, countries like India and Japan are also experiencing significant shifts toward electric buses, with growing investments in green public transportation infrastructure. Meanwhile, Europe and North America are following suit, with governments and private companies in the U.S. and European Union pushing for the widespread adoption of electric and hybrid buses to achieve their sustainability goals.
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Several major players dominate the bus market, ranging from manufacturers of traditional diesel buses to leaders in the electric bus space. Some of the key companies in the global bus market include:
These companies are engaged in various strategies, including partnerships, mergers and acquisitions, and geographical expansion, to bolster their presence in the competitive bus market.
As the global bus market continues to evolve, technological innovation and sustainability will remain central to its future growth. The rise of electric and autonomous buses, coupled with the increasing demand for public transportation due to urbanization, will fuel the expansion of the industry. However, addressing infrastructure challenges and ensuring the seamless integration of new technologies into existing urban landscapes will be essential for sustaining growth in the years to come.
With strategic investments in research and development, coupled with supportive government policies, the bus market is on track to meet the diverse transportation needs of a rapidly urbanizing world.
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