The growing concerns pertaining to the environment among the global populace is the key reason behind the flourishing global market for electric buses. The only barrier to the growth of the global electric bus market is the high cost of these buses. However, the volatility in crude oil prices and the increasing efforts of transit agencies towards minimizing functional costs are likely to reduce the long-term impact of the cost factor.
Of late, various product launches by major enterprises signify the rising level of competition in the global electric bus industry. Several venture capitalists and governments are supporting the companies and transit agencies operating in the global electric bus market by funding them, which in turn is adding to the growth of this industry.
On a whole, the global electric bus market is likely to develop at a CAGR of 28.0% during the period of 2014-2020, in order to attain the anticipated volume of 33,854 units by the end of 2020.
Hybrid Electric Bus Market Dominates Global Industry
The global electric bus market is classified into three main categories, namely the pure electric bus market, the hybrid electric bus market, and the plug-in hybrid electric bus market. The pure electric bus market comprises buses that use batteries to function, whereas the market for hybrid electric buses includes ones that utilize traditional fuel coupled with an electric propulsion system. Plug-in hybrid buses function on similar lines as a hybrid electric bus. The only difference between the two is that the hybrid electric bus generates excess energy while decelerating and other engine processes, while the plug-in hybrid bus needs an external plug-in power source to charge itself and lacks energy regeneration capacities.
The hybrid bus market dominates the global electric bus industry. However, the market for pure electric buses is developing at the fastest rate on account of the increase in consumer interest and the favorable environment created by emission regulations from governments.
Asia Pacific to Register Highest Growth in Global Electric Bus Market between 2014 and 2020
The global market for electric buses is distributed among North America, Europe, Asia Pacific, and the Rest of the World. The U.S. and Canada are the key regional markets in North America, whereas the U.K., Germany, France, and Spain are the main domestic markets for electric buses in Europe. Asia Pacific includes the electric bus markets in China, India, South Korea, and Japan, while the markets in Brazil, Russia, and the Middle East make up the electric bus market in the Rest of the World.
Among all the regional markets, Asia Pacific is poised to experience the highest growth rate during the period from 2014 to 2020. Within the electric bus market in Asia Pacific, China leads the market owing to its large population base and government-initiated clean transportation drives.
The production of electric buses requires intensive capital investment. As the global electric bus market is still in a nascent stage, most large-scale automotive manufacturers have not yet entered this market. The key players operating in this market are Shenzhen Wuzhoulong Motors Co., Ltd., EBUSCO, Alexander Dennis Ltd., Ashok Leyland, Ltd., Solaris Bus & Coach S.A., Zhongtong Bus & Holding Co., Ltd., Daimler AG, Proterra, Inc., AB Volvo (publ), and BYD Company Ltd.
Supported by venture capitalists such as General Motors and Kleiner Perkins Caufield & Byers, which invested US$30 million in Proterra in June 2014, the latter is focused towards advancement and innovation in the conservative transit sector. Apart from this, since 2011, the company has generated more than US$120 million from private equity funding.
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