Indian bus market poised at the edge of high growth
By J Deepthi Nandan Reddy | Express News Service | Published: 16th July 2017 09:05 AM |
HYDERABAD: With an increasing population, worsening traffic congestion and shifting focus on public transportation, the bus segment in India is poised for substantial growth. According to industry representatives and analysts, the sector is yet to reach its full potential and the current scenario in India’s automobile market offers it the chance to do so.
According to industry estimates, with 15 lakh buses in private sector and 1.5 lakh buses in public sector, India has about 16.5 lakh buses. But most of these are old and outdated vehicles, with those aged less than ten years comprising lesser than one-third of the total number (4-4.5 lakh units). This, when compared to nations like China, is a lot lower. India, analysts say, needs many more buses for a population of its size.
“For a population of 1.37 billion, China has about 6,80,000 buses. For a population of 1.3 billion India has only about 4,10,000 buses. Every year 50,000 new buses are being sold but soon, this figure will double as the industry is yet to achieve its full potential and even electric buses are expected to make an entry into market in the near future,” said T Venkataraman, senior vice president - Global Buses, Ashok Leyland, which accounts for about 40 percent bus business in the country.
The bus industry is currently growing at the rate of 6 to 8 per cent every year, adding 50,000 buses per annum. “Buses are going to be the future of public transportation in India, being cheaper and more convenient than both rail and air travel. While South Korea, Japan, China have 70, 30 and 6 buses respectively per 1,000 persons, we have just 1.5 buses per 1,000 persons. Also, the share of state road transport undertakings (SRTUs) in buses is very low as of now. Buses being the vehicle for the common man, many STRUs are planning to increase the number of buses, which will ultimately lead to growth in the number and the size of bus industry,” said PS Ananda Rao, Association of State Road Transport Undertakings.
Several private bus operators have been successfully operating in the industry by catering to public, corporate, government, tourism and other segments, while states have their own road transport undertakings. Both sectors are now expected to drive up demand for buses every year. Ashok Leyland, Tata Motors, Volvo and Scania are some of the major players in the Indian bus market.
For a population of 1.37 billion, China has about 6,80,000 buses. For a population of 1.3 billion India has only about 4,10,000...T Venkataraman, senior vice president - Global Buses, Ashok Leyland