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The global electric bus market size was 170 thousand units in 2020. The global impact of COVID-19 has been unprecedented and staggering, with electric buses witnessing a negative impact on demand across all regions amid the pandemic. Based on our analysis, the global market exhibited a lower growth in 2020 than the average year-on-year growth during 2017-2019. The market is projected to grow from 192 thousand units in 2021 to 544 thousand units in 2028 at a CAGR of 16.0% in the 2021-2028 period. The rise in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.
According to the United Nations Environment Programme (UNEP), urban buses are responsible for a large number of black carbon emissions in the transportation segment. Therefore, UNEP provides policy and technical support to 20 cities in Asia, Africa, and Latin America to map and develop low-emission transportation roads for the public by including e-buses. Also, UNEP has worked with the International Council for Clean Transport (ICCT) and regional partners to offer technical support to remove and identify obstacles and encourage the adoption and design of clean buses to accomplish public commitments. These government initiatives are expected to promote the electric bus market growth during the forecast period.
Dropping Demand for Public Transport amid COVID-19 to Hinder Market Growth
The COVID-19 pandemic triggered an unprecedented decline in sales of vehicles at the beginning of 2020, which affected the automotive industry and severely affected ebus demand. In order to curtail the spread of the coronavirus, several transportation and manufacturing operations have been halted along with public transport. Due to citywide lockdowns, limited employees, and social distancing using all safety measures to run production lines, the global automobile industry has slowed down, and public commuting has also been disturbed. As the coronavirus has an increasing impact on the e-bus sector, sales and demand in the market may drop considerably. People are anxious about the spread of the coronavirus, and they are frightened of using public transportation. It is expected that this will also slow down the growth of the electric passenger car market.
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Environmental Benefits of Electric Buses is a Prominent Trend
Vehicle emissions are specifically responsible for the emission of 29% of ozone-depleting substances, which can cause harm to the atmosphere by air pollution. The consumption of unrefined petroleum and rising fuel costs have augmented the reputation and the demand for vehicles that are less harmful to nature and use electricity has also increased. Also, this has stimulated the expansion of the implementation of e-buses to lessen the dependence on petroleum fuels as they are used in high emission vehicles or buses including diesel buses. Also, because there are smaller moving parts, e-buses are lighter and more productive than traditional transportation methods. As a result, the requirement for vehicle maintenance is reduced, and as a whole, these vehicles are good for the environment. Therefore, owing to these factors, the market is expected to grow significantly during the forecast period.
Rising Adoption of Hydrogen Fuel Cell Buses to Boost the Market
Hydrogen fuel cell buses are powered by combining the powertrain with a fuel cell system, batteries, and controlled technology. These buses are considered the next generation of green vehicles since they have an extended life span than e-buses. Hydrogen fuel cell buses have route flexibility and a fast refueling speed. Through such benefits, the demand for these buses is exponentially increasing for public transport systems. For example, in Europe, about 1,000 hydrogen-powered buses will be introduced over the next few years. China has continuously been a leader in this technology and is driving the market.
Stringent Emission Regulations by Government Are Anticipated to Drive Market Growth
As the World Health Organization (WHO) pointed out, death's most vital cause is air pollution. Subsequently, the discharge of vehicles will affect the overall health, thereby affecting the environment as it might cause harm to the environment. Administrations worldwide are capitalizing heavily on infrastructure construction to reduce ozone-depleting substances and lower air pollution levels. This is accomplished by instituting strict emission standards by the government transportation authority. These guidelines are driving the expansion of this market. These buses do not discharge any harmful substances, and so they are environmentally friendly. Also, e-buses are proficient and provide clean urban transportation, offering urban communities an alternative to clean air maintainability. In response, many urban areas are increasingly accepting electronic transportation systems in certain countries, such as the United States and China.
Exorbitant Costs of E-buses May Restrain Market Growth
E-buses not only have low maintenance costs but are also environmentally friendly. However, compared with conventional buses, these buses have a higher initial cost. This is a key obstacle for some administrative departments, large fleet operators, transit agencies, and governments to implement e-buses in the public transportation segment. Additionally, the government’s support in the form of subsidies for the purchase of private e-buses might positively impact the market for those willing to buy commercial bus fleets. Moreover, the price of these buses is ten times that of the conventional buses, which may hinder the growth of the market.
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Battery Bus Segment to Dominate the Market in the Upcoming Years
Based on the type, the market is segmented into battery, plug-in hybrid, and fuel cell electric bus. The battery-electric bus segment holds a major electric bus market share in the global market. Battery-powered buses store electricity in large battery capacity packs. These buses use the strength of these batteries to run electric motors and operate on all electronic devices. The fuel cell segment is likewise estimated to grow exponentially in the forecast period because hydrogen fuel cell buses have a longer service life than conventional e-buses, and they can quickly refuel. The plug-in hybrid segment is also expected to show good growth in the market. These buses can charge the battery by plugging in an external power supply and have regenerative braking systems.
Asia-Pacific Electric Bus Market Volume, 2020 (Thousand Units)
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The market size in Asia Pacific stood at 167 thousand units in 2020. The region is expected to dominate the market in terms of share. Due to the largest market in terms of quantity, China is in a leading position in regional and global markets. The Chinese government has developed public transportation zones for e-buses. The government's mission has promoted the widespread use of battery-powered buses in the region. Also, the presence of market leader BYD has further boosted the market's growth in this region. Also, the fast-growing charging stations in the region would bode well for the regional market. Japan and South Korea have also contributed to the successful development of e-buses in the region.
Europe is the second-largest market and is expected to show significant growth during the forecast period. The government's strict vehicle emission policy is the main factor driving the market growth in this region. Many governments have begun projects to make urban public transportation sustainable by deploying clean and green transportation technologies in the area. The demand for fuel cell buses in the region is also growing.
North America is also anticipated to show good growth in the global market. The United States is expected to show steady growth in regional revenue. The country's strict emission standards are likely to drive the market in the next few years.
The rest of the world market is growing slowly as the adoption of electric vehicles is slower in its countries due to lack of required infrastructure such as charging stations. Moreover, lack of awareness among government authorities and high vehicle costs are few factors restraining the market growth in this region.
BYD is a Global Leader in the Electric Bus Market
BYD is a global leader in this market as it provides services and manufactures e-buses. It is a high-tech company dedicated to the technological revolution to improve lives. It has played an important role in industries allied to electronics, new energy, automobiles, and railway transportation. BYD is dedicated to supplying zero-emission energy resolutions. The company mainly focuses on targeting developed countries as the adoption of these vehicles is primarily driven in those countries due to the availability of necessary infrastructure. Moreover, the company also targets government and private organizations for delivering their ebus range.
An Infographic Representation of Electric Bus Market
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The global electric bus industry report provides a detailed analysis of the market and focuses on key aspects such as leading companies, product types, and leading applications of the product. Besides this, it offers insights into the market forecast and trends and highlights key industry developments. In addition to the factors above, the report encompasses several factors that have contributed to the growth of the market over recent years.
Volume (thousand units)
Fortune Business Insights says that the global market volume was 170 thousand units in 2020 and is projected to reach 544 thousand units by 2028.
In 2020, the Asia-Pacific market volume stood at 167 thousand units.
The market is projected to grow at a CAGR of 16.0% in the forecast period (2021-2028).
The battery segment is expected to lead this market during the forecast period.
Stringent government norms for vehicle emission are propelling the market growth.
BYD is the major player in the global market.
Asia-Pacific dominated the market in terms of share in 2020.
The increasing usage of hydrogen fuel cell buses is expected to drive the adoption.
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