Electric Bus Market size is poised to reach USD 5 Billion by the end of 2033, growing at a CAGR of 17% during the forecast period, i.e., 2023-2033. In the year 2022, the industry size of electric bus was USD 800 Million. The growth of the market is primarily attributed to the dynamically growing demand for zero-emission buses (ZEBs) in the transport sector, owing to the rising emission of greenhouse gases worldwide, followed by the surging demand for fuel-efficient buses, is also propelling the growth of the market. For instance, as per 2020 data, it was found that transportation is responsible for almost 28% of greenhouse gas emissions globally. The zero-emission buses utilize electricity to power the battery, and they do not use any fossil fuels that release harmful gases. Also, the use of electric vehicles will reduce greenhouse gas emissions. Oil, petrol, or diesel consumption will produce combustion of these fuels that increase the percentage of greenhouse gases in the environment.
The cost of maintenance and electricity price of these vehicles is lower than any conventional fuel vehicle. With the increasing demand for transportation automobiles, electric buses are one of the best and most efficient vehicles for passengers. With the rising demand for fuel-efficient transport systems along with lower maintenance costs, the demand for the electric bus is on the rise amongst the mobility service providers, which in turn, is expected to generate huge revenue opportunities for the prominent market players in the global electric bus market in the coming years. As per research conducted in 2020 in the United States, switching from a diesel to an electric bus is forecasted to save ~USD 150,000 in fuel and over USD 180,000 in maintenance over the bus’s lifetime. Besides this, increasing initiatives and support from the governments of nations for achieving zero emissions is another major factor that is also boosting the growth of the market during the projected timeframe.
Growth Drivers
Challenges
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Base Year |
2022 |
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Forecast Year |
2023-2033 |
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CAGR |
17% |
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Base Year Market Size (2022) |
USD 800 Million |
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Forecast Year Market Size (2033) |
USD 5 Billion |
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Regional Scope |
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Autonomy (Semi-Autonomous, Autonomous)
The global electric bus market is segmented and analyzed for demand and supply by autonomy segment into semi-autonomous and autonomous. Amongst these segments, the autonomous segment is anticipated to garner the largest revenue by the end of 2033, backed by the increasing use of self-driving vehicles across many cities along with the rising number of new purchases to avoid road accidents. Further, it is estimated that autonomous vehicles attribute to approximately 10% of total car registrations occurring by the end of the year 2030 across the globe. The increasing number of road accidents owing to manual errors and high speed is estimated to project the growth of the market’s segment as per the market analysis. The rising penetration of the internet and growing digitalization across the world is increasing the demand for self-driven vehicles or intelligent vehicles. The increasing concern for safety among people, and the convenience offered by autonomous cars are expected to rise the segment’s growth in the coming years.
Propulsion Type {Battery Electric Vehicle (BEV), Hybrid Electric Vehicle (HEV), Plug-in Hybrid Electric Vehicle (PHEV), Fuel Cell Electric Vehicle (FCEV)}
The global electric bus market is also segmented and analyzed for demand and supply by the propulsion type into battery electric vehicle (BEV), hybrid electric vehicle (HEV), plug-in hybrid electric vehicle (PHEV), and fuel cell electric vehicle (FCEV). Among these, the battery electric vehicle (BEV) segment is estimated to garner significant growth. The rising number of government initiatives to reduce fuel emissions into the environment, public concern to purchase eco-friendly products, and increasing investment in the research and advancement of battery electric vehicles are projected to propel the market’s segment growth. The growth of battery vehicles in turn increases the growth of the global electric bus market. The battery can be rechargeable at power stations, which improves the efficiency of the vehicles. The battery powered vehicles decrease the cost of maintenance and increase profit for the manufacturer and consumer. The number of battery electric vehicles used across the world in the year 2021 as per the statistical estimations was more than 11 million.
Our in-depth analysis of the global market includes the following segments:
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By Power Output |
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By Autonomy |
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By Propulsion Type |
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Asia Pacific Market Forecast
The Asia Pacific electric bus market, amongst the market in all the other regions, is projected to hold the largest market share by the end of 2033. The growth of the market can be attributed majorly to the presence of giant manufacturers in the region, along with the growing penetration of electric buses, as well as the increasing awareness among governments about encouraging the adoption of battery vehicles to reduce environmental pollution. Moreover, it was reported that ~100% of battery-electric buses around the globe were deployed in China, which is about 18% of China's total bus count in 2019. With the rising population across the region, the traffic on the roads rises day by day, which releases greenhouse gases into the environment. Electric vehicles help to eliminate this problem by increasing their efficiency of the vehicles. Furthermore, there has been a growing adoption of people for public transportation, as it is cheap to travel daily for work, school, or college compared to other conventional methods. Electric vehicles also reduce the discomfort caused by the smoke released during fuel combustion on the roads. Lastly, electric buses are the new way of transport to serve the purpose of transport by eliminating air pollution, that is further expected to boost the market’s growth in the region.
BYD Motors Inc. partnered with the Napa Valley Transportation Authority, a countrywide transport planning agency, to reveal the “butterfly bus” of the community in St. Helena, that helps passengers in wine country.
Volvo Group launched a new fuel-saving platform for its premium coach range of Volvo Buses and for chassis customers. This will save fuel up to 9% and have power ratings of up to 500 hp which reduced the operation cost of charter, tour, and line haul.
Author Credits: Harshita Srivastava, Saima Khursheed
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