GLOBAL BUS MARKET (2025 - 2030)

The Bus Market was valued at USD 55.75 Billion in 2024 and is projected to reach a market size of USD 94.16 Billion by the end of 2030. Over the forecast period of 2025-2030, the market is projected to grow at a CAGR of 9.13%.

Buses are generally sizable vehicles intended to carry numerous passengers within urban areas over short to medium distances. Conversely, coaches resemble buses but offer enhanced comfort, greater space, and facilities suitable for long-distance journeys. They are commonly utilized for intercity travel, tourism, or private hire services.

Key Market Insights:

In Europe, most e-bus sales are expected to be bundled as part of broader transit investments, combining e-buses with infrastructure and supplementary services. By adopting this integrated approach, municipalities—particularly small and medium-sized cities—can effectively mitigate many of the uncertainties associated with e-bus deployment. In contrast, larger cities, which generally possess more developed infrastructure capabilities, may opt to procure individual components separately, especially once they have completed the initial learning phase.

Market Drivers:

The expansion of travel and tourism activities is expected to significantly propel the growth of the bus and coach market.

The post-pandemic surge in travel and tourism has notably accelerated the expansion of the bus and coach market. Buses are widely favored in the travel and tourism sector due to their convenience, cost-effectiveness, and ability to transport large groups of passengers. With the continued growth of global travel and tourism, demand for buses is expected to increase substantially.

Additionally, the rising need for efficient and environmentally sustainable public transportation systems has further propelled the bus and coach market. Numerous countries are channeling investments into transportation infrastructure, including bus rapid transit networks and upgraded road systems.

Increasing emphasis on enhancing passenger comfort within public transportation is contributing to the growth of the market.

The growing focus on passenger comfort in public transportation is driving the demand for improved seating and amenities in buses. In addition, passengers increasingly prioritize convenience and comfort during their journeys. As a result, bus manufacturers and operators are investing heavily in enhancing the overall passenger experience. These initiatives include redesigning seating layouts with ergonomic features and upgrading interior facilities such as air conditioning, Wi-Fi connectivity, and onboard entertainment systems. Such ongoing improvements are boosting customer satisfaction and further increasing the appeal of bus travel.

Market Restraints and Challenges:

Significant capital requirements for the production of buses and coaches may act as a constraint on market growth.

The substantial initial investment required for buses and coaches can limit market growth. Compared to light commercial vehicles, these vehicles involve higher purchase and maintenance costs. Ongoing operational expenses, including fuel, maintenance, and driver wages, can also be considerable.

Additionally, the availability and quality of supporting infrastructure can act as a constraint. Buses and coaches rely on well-maintained roads, dedicated bus lanes, sufficient terminals, and parking facilities. Inadequate infrastructure can adversely affect the efficiency and effectiveness of bus and coach services.

Market Opportunities:

The increasing availability of electric autonomous buses is creating new growth opportunities in the market.

The expanding availability of electric autonomous buses is positively influencing the growth of the bus market. Furthermore, integrating these buses into urban transportation systems is contributing to a significant reduction in greenhouse gas emissions. Operating on electricity, they produce minimal to no emissions, thereby mitigating the environmental impact associated with traditional diesel or gasoline-powered buses. This transition also aligns with the global emphasis on environmental sustainability, making electric autonomous buses an attractive option for cities and transit authorities.

GLOBAL BUS MARKET

Market Segmentation:

Segmentation By Vehicle Type:

• Diesel Bus
• Electric Bus
• CNG/LPG Bus
• Hybrid Bus
• Others

Diesel buses have long held a dominant position in the market due to their cost efficiency and well-established refueling infrastructure, making them a preferred option for many public and private operators. However, the market landscape is shifting rapidly as environmental concerns and regulatory pressures encourage the adoption of cleaner alternatives. Diesel buses are gradually losing market share, particularly in developed regions, as fleets transition to more sustainable propulsion technologies.

Within this segment, electric buses are registering the fastest growth. Governments and municipalities are increasingly prioritizing the electrification of public transport fleets to achieve climate objectives. The rise in electric bus adoption is supported by advancements in battery technology, reductions in total cost of ownership, and the expansion of charging infrastructure.

By Application:

• School Bus
• Transit Bus
• Shuttle Bus
• Coach
• Others

Transit buses account for the largest segment of the market, supported by the continued expansion of urban public transportation networks and the demand for high-capacity, reliable vehicles in densely populated areas. Municipal authorities are investing in modern, low-floor transit buses featuring advanced safety and accessibility enhancements to improve passenger comfort and operational efficiency. The incorporation of real-time passenger information systems and contactless payment solutions is further increasing the attractiveness of transit buses for both operators and commuters.

School buses represent a substantial and stable segment, particularly in North America, where dedicated school transportation is legally mandated in many regions. A strong focus on student safety, combined with growing concerns over emissions in school zones, is driving the demand for electric and low-emission school buses. Manufacturers are introducing purpose-built models that emphasize safety, comfort, and environmental performance. In emerging markets, the adoption of school buses is also rising as governments work to enhance access to education and reduce traffic congestion around schools.

By Seating Capacity:

• Up to 30 Seats
• 31–50 Seats
• Above 50 Seats

Buses with up to 30 seats are primarily deployed for shuttle services, school transportation, and private charters, where flexibility, maneuverability, and lower operating costs are essential. These smaller buses are especially suitable for urban areas with narrow streets or limited parking, as well as rural regions with lower passenger demand. Manufacturers are focusing on optimizing interior layouts and integrating advanced safety features to enhance the appeal of this segment.

The 31–50 seat category represents the largest share of the bus market, offering a balance between passenger capacity and operational efficiency. These medium-sized buses are commonly utilized in city transit systems, intercity travel, and school transportation, providing adequate seating for high-demand routes without compromising fuel efficiency or maneuverability. Transit authorities and private operators favor this segment for its versatility, cost-effectiveness, and adaptability across various applications. Adoption of electric and hybrid models within this category is increasing as operators pursue sustainability objectives.

By Propulsion:

• Electric
• ICE
• Hybrid
• Fuel Cell

Internal combustion engine (ICE) buses, powered by diesel or gasoline, have traditionally dominated the market due to their reliability, well-established infrastructure, and lower initial costs. However, increasing concerns about air pollution, greenhouse gas emissions, and fuel expenses are driving a transition toward cleaner propulsion systems, particularly in urban areas subject to strict environmental regulations.

Electric buses are leading this shift, providing zero tailpipe emissions, reduced operating costs, and a quieter, more comfortable experience for passengers. Advances in battery technology, combined with government incentives and investments in charging infrastructure, are making electric buses viable for a broad range of applications. In 2024, electric buses represented a significant portion of new bus sales in China, Europe, and select North American cities, with adoption expected to accelerate further as technological improvements and economies of scale reduce costs.

Hybrid buses, which integrate ICE and electric propulsion, offer a practical alternative for operators aiming to lower emissions and fuel consumption without fully transitioning to electric fleets. These vehicles are particularly effective on routes with variable speeds and frequent stops, where regenerative braking and electric assist can enhance efficiency. Hybrid technology serves as a transitional solution toward full electrification, allowing operators to modernize their fleets gradually while minimizing operational disruptions.

By End-User:

• Private Fleet
• Public Transport
• Tourism
• Educational Institutions
• Others

Public transportation continues to be the largest end-user segment, representing a significant portion of global bus sales. Governments and municipal authorities are making substantial investments in fleet expansion and modernization to meet the increasing demand for affordable, reliable, and sustainable urban mobility. The adoption of electric and hybrid buses is especially prominent in this segment, driven by regulatory mandates, funding initiatives, and public expectations to reduce emissions.

Private fleets, encompassing corporate shuttles, airport transfers, and charter services, are emerging as a rapidly growing market segment. Organizations are increasingly recognizing the advantages of providing dedicated transportation for employees, clients, and guests, both as a value-added service and as a strategy to reduce parking requirements and traffic congestion. Private operators are also leading in the integration of premium amenities such as Wi-Fi, entertainment systems, and luxury seating to differentiate their services and enhance passenger satisfaction.

Educational institutions, particularly in North America and select regions of Asia, represent a significant segment of school bus purchasers, with a strong focus on safety, reliability, and environmental performance. The adoption of electric school buses is accelerating, supported by government grants, rebates, and heightened awareness of the health impacts of diesel emissions on children. Manufacturers are responding with purpose-built models that emphasize safety, incorporating reinforced structures, advanced braking systems, and real-time tracking technologies

Market Segmentation: Regional Analysis:

• North America
• Europe
• Asia-Pacific
• South America
• Middle East & Africa

The Asia Pacific region dominates the global bus market, accounting for the largest share in both production and sales. China leads the region, driven by proactive government policies promoting electric buses, rapid urbanization, and a well-established manufacturing ecosystem. India is also a key contributor, with increasing investments in public transportation and the growing adoption of CNG and electric buses in major cities.

The United States is the primary market, supported by the extensive use of school buses, fleet modernization initiatives, and rising interest in electric and hybrid models. Federal and state-level funding programs are accelerating the deployment of zero-emission buses, particularly in urban transit networks. Canada is also investing in sustainable public transportation, with a focus on reducing emissions and improving accessibility. The region is expected to maintain steady growth, driven by regulatory mandates, technological advancements, and heightened public awareness of environmental issues.

Europe represents a key market for sustainable mobility and is at the forefront of adopting electric and hydrogen fuel cell buses. This is supported by strict emission regulations, ambitious climate targets, and substantial government funding. Cities such as London, Paris, and Berlin are leading the transition to zero-emission fleets, setting benchmarks for other regions. Increased investments in public transportation infrastructure are being driven by urbanization, population growth, and the need for cost-effective mobility solutions. Adoption of alternative propulsion technologies is gaining momentum, although from a smaller base, as governments prioritize sustainable development and air quality improvements.

COVID-19 Impact Analysis:

The COVID-19 pandemic had a significant negative impact on the automotive industry. Global lockdown measures severely affected the bus and coach market, leading many operators to suspend services entirely or operate at reduced capacity to mitigate the spread of the virus.

During the pandemic, physical distancing measures, social bubbling, and other mitigation protocols limited buses and coaches to 35–50% occupancy. As lockdown restrictions were gradually lifted and destinations began to reopen, bus and coach operators resumed services; however, passenger numbers remained restricted, and demand was dampened since not all sectors and travel activities had fully reopened.

Latest Market News:

October 2025: Starting in 2026, Daimler Buses plans to roll out its own network of public charging stations for electric buses and coaches, focusing on high-traffic tourist destinations in Europe, such as bus parking areas at amusement parks and urban centers. The initiative aims to expand high-performance charging infrastructure beyond highways, enabling electric buses and coaches to access more remote travel locations—currently feasible only in limited instances. The project will begin with a pilot program launched by the regional energy and climate protection agency NRW.Energy4Climate in partnership with the City of Cologne, with four public fast-charging stations for electric buses and coaches planned near the city center next year.

October 2025: VinFast unveiled two new electric bus models at Busworld Europe 2025, marking the company’s entry into the European public transport market. The EB 12, a 12-meter model, has obtained UNECE and CE certification and is now available for order in Europe, while the smaller 8-meter EB 8 is expected to follow. Both models feature an unlimited mileage warranty, covering five years for the vehicle and extending up to eight years for the high-voltage battery and corrosion protection.

Latest Trends and Developments:

The integration of advanced technologies is set to transform the transportation industry, ushering in a new era of efficiency and enhanced passenger experience through real-time data and analytics. Leveraging innovations such as Artificial Intelligence (AI) and Machine Learning (ML), manufacturers are working to elevate overall travel quality and operational performance.

Smart buses are equipped with a range of features designed to improve the passenger experience, including optimized route planning, vehicle health monitoring, fuel consumption tracking, and enhanced fleet management. In addition, these buses incorporate advanced safety systems to protect both passengers and drivers, such as driver monitoring, onboard surveillance, collision avoidance mechanisms, and emergency communication capabilities.

Key Players in the Market:

AB Volvo

Ashok Leyland (Hinduja Group)

Anhui Ankai Automobile Co. Ltd.

IVECO S.p.A

BYD Company Ltd.

NFI Group

Mercedes-Benz Group AG

Tata Motors Limited

Solaris Bus & Coach sp. z o.o. (Construcciones y Auxiliar de Ferrocarriles S.A.)

Xiamen King Long United Automotive Industry Co. Ltd.

Suzhou Eagle Electric Vehicle Manufacturing Co. Ltd