Electric Bus Market Trends

Growth Drivers

• Fleet modernization plans: Globally, transit organizations are developing advanced electric vehicles, with an effort to reduce carbon emissions. In October 2024, Ashok Leyland announced that its subsidiary OHM Global Mobility received an order of 500 12-meter ultra-low-floor e-buses from the Metropolitan Transport Corporation (MTC), Chennai. In addition, Switch Mobility, the EV arm of Ashok Leyland, is expected to supply Switch EiV12 models to OHM and is likely to manage and operate them for around 12 years. The vehicles are likely to cover distances of more than 200 kilometers per charge, and are ideal for long city routes. This highlights a significant shift toward sustainable public transportation, therefore accelerating the market growth.

• Private sector investment and innovation: Various key players are increasingly investing in research and development to launch more cost-effective, efficient, and reliable electric bus models. For instance, in February 2024, BYD Company Limited expanded its R&D wing to over 90,000 engineers and filed more than 48,000 patents around the globe.  On the other hand, Volvo, in March 2024, introduced the BZR electric bus chassis, catering to city and intercity services, featuring a modular design and advanced battery technology. These advancements are portraying the role of the private sector in supporting the global transition to sustainable public transportation.

Challenges

• Battery performance limitations: The overall performance of the battery is posing a major challenge to the growth of the e-bus market. In extreme temperatures, battery efficiency can drop, causing range anxiety. This results in shorter ranges of driving and replacement requirements due to the degradation of batteries. Such factors are reducing the practicality of the electric buses, hindering the market growth.