What is the Current State of the Bus Manufacturing Industry in the US?

The US transit bus manufacturing industry has changed considerably over the past two decades. Bus quality has improved and new technologies have resulted in increased reliability and a wider range of alternative fuel strategies, including battery-electric transit buses. Yet, this is a fragile industry due to low volume, changing regulations, and unstable federal funding. Researchers at the Mineta Transportation Institute conducted a comprehensive state of the industry analysis to better understand the challenges and opportunities facing bus manufacturers and to provide policy makers with recommendations to help move the industry forward while best serving the transit-riding public.

As noted in the report, The US Transit Bus Manufacturing Industry, manufacturing buses for the US transit market is a small market with volatile demand. Over the past two decades, annual spending on buses by US transit agencies has fluctuated between extremes of $1.4 billion and $3.1 billion (in 2014 dollars). According to Dr. David Czerwinski, principal investigator for this research, “Many manufacturers have gone bankrupt, left the market, or been acquired by competitors.”

Interviews conducted with industry stakeholders identified a number of challenges facing the industry. Notably, and despite increases for annual public transit funding under the new FAST Act, interviewees still felt that there was not enough funding to allow transit agencies to retire and upgrade their bus fleet in a timely fashion.

To ensure a thriving transit bus manufacturing industry that continues to improve the quality of buses, invests in R&D, and best serves the riding public, the authors policy makers should:

• Work to ensure long-term, stable funding that builds on the FAST Act to allow transit agencies to make long-term purchasing plans for buses.
• Continue to support research & development related to alternative fuels.
• Facilitate an industry-wide conversation around standardization of battery-electric charging infrastructure and implement policies so that transit agencies aren’t penalized financially for adopting battery-electric technology.
• Think carefully about whether this industry, due to its small size, is well positioned to take the lead on clean-air regulations that advance the nation’s environmental quality.

The report is available for free download from http://transweb.sjsu.edu/project/1234.html