Global Transit and Coach Bus Growth Outlook, 2025
Description
Global transit and coach bus sales are forecast to reach 266,700 units in 2025, with substantial growth attributed to the fast-growing markets in China and India. Increased demand for transit buses is fueled by fleet modernization and government subsidies for alternative powertrains, while the robust tourism growth drives the coach bus segment.
The electric bus (eBus) market is poised for rapid expansion due to factors such as emission regulations, declining battery prices, the emergence of low-emission zones, purchase subsidies, and tax exemptions. The growing adoption of transit eBuses opens up opportunities for the global sourcing and supply of alternative powertrain buses, fostering collaboration among incumbent automakers, suppliers, and new market entrants.
Targeted regulations, including the EU Clean Vehicle directive, are expected to boost eBus adoption, particularly in national public transport procurement. The revised CO2 emissions, approved by the European Parliament in April 2024 and ratified by the Council of the European Union in May 2024, will also encourage growth. BEV buses are expected to experience strong growth from 2024 to 2027, supported by the entry of major utility and energy companies into the electric charging infrastructure space.
In China, BEV buses are forecast to see considerable growth with the introduction of the 2025 New Energy City Bus and Power Battery Renewal Subsidy Implementation Rules. These rules, which empower local governments to update their fleets of new energy city buses based on actual demand and quantity ratios, will drive the growth of new energy buses. The government's policy to integrate rural passenger, freight, and postal services will alleviate public transportation's overcapacity and establish a new rural transportation service model that emphasizes convenience and efficiency. Chinese coach buses registered strong growth in 2024. Additionally, Chinese eBus OEMs are rapidly expanding globally, driven by the establishment of manufacturing and assembly plants, as well as growing exports.
In India, the bus market's growth in 2024 was mainly driven by the revival of public transport demand across intercity and intracity routes, large-scale procurement of buses by state transport undertakings to replace aging fleets, and fleet modernization initiatives by private transport operators due to the increased movement of people for work, education, and leisure. The 2024 rollout of the PM-eBus Sewa-Payment Security Mechanism scheme aimed to mitigate the risk of payment delays and enhance the bankability of OEMs and operators engaged in concession agreements with public transport authorities.
Brazil’s federal government’s Programa de Aceleração do Crescimento (Novo PAC) has allocated substantial funding for the renewal of public transport fleets and infrastructure projects in public transport and active mobility in large and medium-sized cities with more than 150,000 inhabitants. Electric powertrains are increasingly popular in the region, driven by electromobility and energy efficiency regulations, as well as cities’ sustainable development goals. In 2025, Santiago de Chile plans to deploy 1800 electric buses, improving urban air quality, reducing noise pollution, and aligning with Chile’s long-term environmental goals. Major Latin American countries are developing electromobility strategies to promote zero-emission buses in their public transportation systems. ZEV bus tenders focus on performance-based contracts where manufacturers meet requirements for strong post-sales support, including preventive maintenance and guaranteed spare parts.
The study also explores the following areas across various global markets, including North America, Europe, Latin America, China, and India:
• Notable regulations and mandates
• Top industry trends and impact by region
• Powertrain technology share by region, including electric and natural gas vehicles
• Powertrain technology product portfolios of OEMs
• Growth opportunities
The electric bus (eBus) market is poised for rapid expansion due to factors such as emission regulations, declining battery prices, the emergence of low-emission zones, purchase subsidies, and tax exemptions. The growing adoption of transit eBuses opens up opportunities for the global sourcing and supply of alternative powertrain buses, fostering collaboration among incumbent automakers, suppliers, and new market entrants.
Targeted regulations, including the EU Clean Vehicle directive, are expected to boost eBus adoption, particularly in national public transport procurement. The revised CO2 emissions, approved by the European Parliament in April 2024 and ratified by the Council of the European Union in May 2024, will also encourage growth. BEV buses are expected to experience strong growth from 2024 to 2027, supported by the entry of major utility and energy companies into the electric charging infrastructure space.
In China, BEV buses are forecast to see considerable growth with the introduction of the 2025 New Energy City Bus and Power Battery Renewal Subsidy Implementation Rules. These rules, which empower local governments to update their fleets of new energy city buses based on actual demand and quantity ratios, will drive the growth of new energy buses. The government's policy to integrate rural passenger, freight, and postal services will alleviate public transportation's overcapacity and establish a new rural transportation service model that emphasizes convenience and efficiency. Chinese coach buses registered strong growth in 2024. Additionally, Chinese eBus OEMs are rapidly expanding globally, driven by the establishment of manufacturing and assembly plants, as well as growing exports.
In India, the bus market's growth in 2024 was mainly driven by the revival of public transport demand across intercity and intracity routes, large-scale procurement of buses by state transport undertakings to replace aging fleets, and fleet modernization initiatives by private transport operators due to the increased movement of people for work, education, and leisure. The 2024 rollout of the PM-eBus Sewa-Payment Security Mechanism scheme aimed to mitigate the risk of payment delays and enhance the bankability of OEMs and operators engaged in concession agreements with public transport authorities.
Brazil’s federal government’s Programa de Aceleração do Crescimento (Novo PAC) has allocated substantial funding for the renewal of public transport fleets and infrastructure projects in public transport and active mobility in large and medium-sized cities with more than 150,000 inhabitants. Electric powertrains are increasingly popular in the region, driven by electromobility and energy efficiency regulations, as well as cities’ sustainable development goals. In 2025, Santiago de Chile plans to deploy 1800 electric buses, improving urban air quality, reducing noise pollution, and aligning with Chile’s long-term environmental goals. Major Latin American countries are developing electromobility strategies to promote zero-emission buses in their public transportation systems. ZEV bus tenders focus on performance-based contracts where manufacturers meet requirements for strong post-sales support, including preventive maintenance and guaranteed spare parts.
The study also explores the following areas across various global markets, including North America, Europe, Latin America, China, and India:
• Notable regulations and mandates
• Top industry trends and impact by region
• Powertrain technology share by region, including electric and natural gas vehicles
• Powertrain technology product portfolios of OEMs
• Growth opportunities
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