SOURCE: Freedonia Group, Inc.

September 21, 2006 09:09 ET

World Bus Demand to Exceed 350,000 Vehicles in 2010

CLEVELAND, OH -- (MARKET WIRE) -- September 21, 2006 -- Worldwide demand for buses is forecast to advance 4.2 percent annually to over 350,000 vehicles in 2010. Demand for buses tends to follow a cycle that depends on region-specific trends, such as demographics, income levels, per-capita passenger vehicle density, and others. Rising fuel prices worldwide should boost demand for buses. Other forces expected to support bus demand include increasing congestion levels in major metropolitan centers worldwide, the establishment of dedicated bus rapid transit systems and "bus ways" in key cities in Latin America and Asia. These and other trends including market share, market leaders, market size and company profiles are presented in "World Buses," a new study from The Freedonia Group, Inc., a Cleveland-based industry research firm.

The bus market in North America tends to be atypical among developed nations in a number of ways. The United States and Canada have thriving markets for specially designed school buses, which are not common in Europe or Japan. The US also lacks the dynamic passenger train, tram and subway (metro) systems so common in Europe and Japan, making bus travel the primary mass transit option in many US cities. Furthermore, the large distances between cities and states provide a strong stimulus for sales of motor coaches. Western Europe and Japan will experience slower growth in bus demand than the United States due to stagnant, aging populations and the prevalence of other mass transit options such as light rail.

Worldwide, China is both the largest market for and producer of buses, as well as the nation most responsible for supporting the forward momentum expected for bus demand. The country could become a regional hub for bus production although most of its bus output so far has been focused on satisfying local demand. Currently, Chinese bus manufacturers lack the global brand strength of leading producers in western countries, but the cost advantages of Chinese buses would appear to point toward an increased emphasis on exports. Other key bus-producing nations include Brazil, India, Japan, Russia and Turkey, which supply products to meet both regional and global demand. In addition, there exists a robust global market for used buses, with many of these shipped from developed to emerging markets.

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