US Electric Bus Market Is Set to Grow Over 470% by 2024

By Jemima McEvoy Wednesday, April 7, 2021

The market for electric buses in the United States (US) is expected to see massive growth over the next few years, according to a new report from Research and Markets. This boost is expected to drive the market’s value to $2,675.1 million by 2024, providing new opportunities for both the big companies dominating the market and emerging entrepreneurs.

A rendering of an electric bus.

Market Profile

Electric buses — buses powered by electricity — have been on the rise over the past few years. This more sustainable transportation option has gained prominence as many countries put a greater emphasis on combating climate change. However, it’s only recently that electric buses have started expanding beyond the Asia-Pacific region. As of 2019, 99% of the world’s electric battery buses were deployed in China — and electric buses made up more than 17% of China’s total bus fleet.

This transportation option has become more mainstream in other parts of the world, including Europe and the US. After years of quick growth, the market was valued at $469.3 million in 2019, the report states.

Dominating Companies

The market is dominated by a number of companies, including Proterra, BYD Motors, NFI Group, GreenPower Motor Company, GILLIG, Blue Bird Corporation, Nova Bus Corporation, and the Lion Electric Company.

Electric vehicle startups as a whole have been experiencing record-setting growth, as shown by Tesla, Uber, and Alphabet Inc.’s Google, which have all surpassed $10 billion in revenue.

Within the electric bus market specifically, the growth is also explosive. Proterra, a California-based automotive and energy storage company, generated $193 million in expected revenue last year, reporting $750 million in existing orders and 26% gross margin expansion over the last three years. BYD Motors, a Chinese company that supplies electric vehicles in the US, saw its revenue increase by a whopping 41% year-over-year to $6.65 billion in the third quarter of 2020.

Growth Projections

This strong growth is not expected to slow any time soon, according to the report. The analysts predict the US’s electric bus market will grow by a compound annual growth rate (CAGR) of 58.4% between 2020 and 2024. This significant market expansion will bring the market value to $2.67 billion by 2024 — a more than 470% increase from the value of the market in 2019.

This projected growth will be driven by the increased availability of government funding to transit agencies for procuring zero- and low-emission vehicles (including electric buses). An example of this is the Federal Transportation Administration’s (FTA) injection of $85 million into state and local governments to support the incorporation of electric vehicles into their transportation fleets.

Final Takeaways

Due to these subsidies and investments, demand for electric vehicles — including electric buses — is expected to “amplify significantly in the foreseeable future,” the report says. Furthermore, because the market is currently consolidated among a handful of companies, this expansion offers ample opportunities for entrepreneurs exploring the electric vehicle industry.

About the Author

Headshot of Jemima McEvoy

Jemima is a journalist who enjoys reporting on business, particularly small business and entrepreneurship.

Related Articles