Electric Bus Market Size, Share, Growth Analysis, By Propulsion Type (Battery Electric Bus (BEB), Plug-In Hybrid Electric Bus (PHEB)), By Length, By Battery Capacity, By Power Output, By Application, By Region - Industry Forecast 2024-2031

Global Electric Bus Market size was valued at USD 29.50 billion in 2022 and is poised to grow from USD 34.16 billion in 2023 to USD 110.46 billion by 2031, growing at a CAGR of 15.8% during the forecast period (2024-2031).

The global electric bus market is experiencing significant growth driven by the increasing demand for eco-friendly, cost-efficient, and low-maintenance transportation solutions. Electric buses are gaining traction due to their environmental benefits, including zero emissions and quieter operation compared to traditional buses. Additionally, the lower operational costs-thanks to the elimination of fuel and reduced maintenance needs-make them an attractive option for businesses and governments. This surge in demand is fueled by factors such as fluctuating crude oil prices, growing environmental concerns, government initiatives to combat pollution, stringent regulations on internal combustion engine buses, and the decreasing cost of lithium-ion batteries. These drivers are also attracting new players to the market, eager to capitalize on the opportunities in the rapidly evolving electric vehicle sector.

Top-down and bottom-up approaches were used to estimate and validate the size of the Global Electric Bus market and to estimate the size of various other dependent submarkets. The research methodology used to estimate the market size includes the following details: The key players in the market were identified through secondary research, and their market shares in the respective regions were determined through primary and secondary research. This entire procedure includes the study of the annual and financial reports of the top market players and extensive interviews for key insights from industry leaders such as CEOs, VPs, directors, and marketing executives. All percentage shares split, and breakdowns were determined using secondary sources and verified through Primary sources. All possible parameters that affect the markets covered in this research study have been accounted for, viewed in extensive detail, verified through primary research, and analyzed to get the final quantitative and qualitative data.

Global Electric Bus Market Segmental Analysis

Global Electric Bus Market is segmented by propulsion type, length, battery capacity, power output, application and region. Based on propulsion type, the market is segmented into battery electric bus (BEB), plug-in hybrid electric bus (PHEB) and fuel cell electric bus (FCEB). Based on length, the market is segmented into Less than 9 meters, 9-14 meters and above 14 meters. Based on battery capacity, the market is segmented into up to 400 kWh and above 400 kWh. Based on power output, the market is segmented into up to 250 kW and above 250 kW. Based on application, the market is segmented into intercity, intracity and airport shuttle. Based on region, the market is segmented into North America, Europe, Asia Pacific, Latin America and Middle East & and Africa.

Drivers of the Global Electric Bus Market

Governments worldwide are heavily investing in infrastructure development to reduce greenhouse gas emissions and combat air pollution by implementing stricter vehicle emission regulations. These policies are driving the growth of the electric bus market, as electric buses offer an environmentally friendly solution with zero emissions. Furthermore, electric buses are efficient and provide clean urban transportation, offering cities a sustainable alternative for improving air quality. As a result, numerous cities, particularly in nations like China and the U.S., are increasingly adopting electric bus systems to promote eco-friendly public transit and contribute to the broader goal of sustainability in urban mobility.

Restraints in the Global Electric Bus Market

A significant restraint for the global Electric Bus Market is the high initial cost of e-buses compared to conventional buses. Despite their eco-friendly and low-maintenance advantages, the substantial upfront investment required for electric buses hinders their widespread adoption in the public transportation sector. This financial barrier is a key challenge for many governments and public transport authorities, who are reluctant to make the transition without greater financial support. While governments are offering subsidies for private electric vehicles, these incentives may not have the same impact on commercial fleet purchases, further delaying the adoption of electric buses in public transit systems.

Market Trends of the Global Electric Bus Market

A significant market trend in the global Electric Bus Market is the push towards electrification of public transportation, particularly in India. The Indian government has set a goal to electrify 30% of all vehicle sales by 2030, a move that is expected to boost the electric bus sector. To support this initiative, the government allocated over USD 1.4 billion in phase two of the FAME (Faster Adoption and Manufacturing of Hybrid and Electric Vehicles) program, which concluded in 2022. This phase focused on accelerating the adoption of electric buses for public and shared transportation, offering subsidies for more than 7,090 electric buses, thereby driving substantial growth in the market.